Artificial intelligence stands as a towering force in the technological landscape, with a promise of unprecedented influence and prosperity. Analysts at Bank of America project a staggering addition of $15.7 trillion to the global economy by 2030.
While much spotlight has rightfully shone on the impact of AI on daily life, a crucial but often overlooked element is emerging – the indispensable role of copper in this digital revolution.
Hardware Evolution
One of the prime examples lies with Nvidia, a titan in producing cutting-edge chips that power AI servers. Over the past year, the company’s stock, like a rocket, has soared over 260%, establishing itself as a frontrunner in the AI race.
Nvidia, along with key allies such as Taiwan Semiconductor and competitors like Advanced Micro Devices, are akin to merchants in a gold rush, supplying the essential tools for the AI pioneers.
The Underappreciated Copper
Venturing even further upstream, the critical role of copper in the AI and tech ecosystem becomes apparent. While silicon hogs the limelight, copper quietly but indispensably connects the vital components within integrated circuits – akin to synapses firing in the brain. Moreover, it serves as the lifeblood, transporting power to these circuits.
Beyond the realm of chips, copper is the backbone of our electrical grid. From turbines generating energy to batteries storing it, and wires transmitting it across the grid, our modern world’s functioning hinges heavily on the conductive embrace of copper.
Rising Demand, Diminishing Supply
Macro trends like AI, electric vehicles, and decarbonization are propelling the need for copper into the stratosphere. According to McKinsey & Company, global demand is set to swell to 36.6 million metric tons by 2031 from the current 25 million metric tons, while the supply is projected to fall short by a significant 6.5 million metric tons.
Alarming signs of this imbalance are already surfacing, with leading Chinese copper smelters recently agreeing to production cuts due to raw material shortages.
This surging demand and shrinking supply paint a rosy picture for copper investments, beckoning keen-eyed investors to the arena.
A Comprehensive Approach
Ivana Delevska and the forward-thinking team at Spear Invest discern these trends as concrete realities. Spear Invest’s flagship fund, Spear Alpha ETF, casts its net encompassing the AI value chain from top to bottom.
The fund’s diverse portfolio spans companies utilizing AI directly like ZScaler, hardware producers like Nvidia, all the way back upstream to stalwarts like Freeport-McMoRan and Teck Resources heavily involved in the copper mining and processing sector.
This strategic foresight into the broader landscape, reaching far beyond the confines of mere technological advancements, has borne fruit. SPRX has yielded gains of approximately 70% over the past year, a testament to the wisdom of intertwining copper investments with the burgeoning AI sector.