Markets

Copper Miners ETF (COPX) Hits New 52-Week Low

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For investors interested in finding out the painful areas of investing, Global X Copper Miners ETF ( COPX ) is probably on radar now. The fund just hit a 52-week low, and shares of COPX are down roughly 55% from their 52-week high price of $24.78/share.

Are more pains in store for this ETF? Let's take a quick look at the fund and its near-term outlook to get a better idea of where it might be headed:

COPX in Focus

COPX looks to track the performance of the copper mining market. The fund focuses on small caps followed by mid caps. COPX charges investors 65 basis points a year in fees and has top holdings in CST Mining Group, OZ Minerals and Copper Mountain Mining Co (see all Materials ETFs here).

Why the Move?

Copper prices slipped to a six-year low on growth concerns. A weak Chinese economy has been a concern for the fund for long. China matters the most for this metal as the country is the world's biggest consumer of this industrial metal, making up roughly 40% of global copper demand. This along with the looming Fed lift-off bet which strengthened the greenback wrecked havoc on the overall commodity investing, including copper. Notably, mining ETFs generally trade as a leveraged play on the underlying metal and thus see higher changes in prices, either way.

More Pains Ahead?

The fund has a negative weighted alpha of 56.62 . A negative weighted alpha hints at more pain.

So, it is wise to flee the space at the current level as a broad-based commodity market sell-off may be seen in the coming days after the Fed implements a short-term rate hike. Things will likely take some more time to stabilize.

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GLBL-X COPPER (COPX): ETF Research Reports

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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