Nornickel palladium fund launches world’s first ETC on a basket of metals for electric vehicles

A palladium fund established by Nornickel has launched ETC backed by metals needed for electric-vehicle production. ForkLog was told by company representatives.

The initial issue amounted to $10 million. The listing took place on Milan’s Borsa Italiana. In the coming weeks, listings on Deutsche Börse, the London Stock Exchange, and the Swiss Exchange are expected.

Global Palladium Fund (GPF) said that the creation of the financial instrument followed a rise in demand for electric vehicles.

“Through it, investors will gain access to the raw materials used in the production of batteries for electric vehicles. They are essential for the global decarbonisation of the economy,” said Anton Berlin, vice president and head of sales and commercial operations at Nornickel.

The ETC is backed by metals stored physically and will track the performance of the GPF Electric Vehicle Index. The weightings of the metals in the index basket are distributed as follows:

• copper (40%);
• palladium (28.13%);
• nickel (18.65%);
• cobalt (11.45%);
• platinum (1.77%).

All metals are stored in warehouses certified by the London Metal Exchange in Rotterdam, and in the storage facilities of the London Platinum and Palladium Market in London and Switzerland.

The index will be rebalanced annually in July to reflect changes in the usage of metals across various segments. It contemplates the possibility of including other metals depending on demand and availability.

In January 2021, GPF issued digital exchange-traded instruments linked to palladium, platinum, gold and silver on Deutsche Börse.

In June, the ETC backed by nickel and copper was added to the listings of the London Stock Exchange and Borsa Italiana.

In September, GPF listed on the Vienna Stock Exchange an ETC backed by nickel with a neutral carbon balance.

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