The uranium spot price is getting close to US$60 per pound, but many experts believe it’s still early days.
Speaking to the Investing News Network, Ben Finegold of Ocean Wall said that while positive catalysts for the market continue to build, investors still have time to get positioned ahead of what’s set to be a long-term secular growth trend.
He noted that sector major Cameco (TSX:CCO,NYSE:CCJ) is up about 30 percent year-to-date, but said that in the context of the entire bull market, that increase will ultimately pale in comparison to future moves in uranium equities.
“Our belief is that when you look at the 30 percent move in Cameco, in the exact same way that stocks were down 30 percent this year or last year … we think it will be insignificant. We think that the move in uranium stocks and the uranium price is going to be so highly convex that these (smaller) moves are not going to have a significant effect necessarily on your portfolio,” he said.
When asked what category of uranium equities he sees as most interesting, Finegold said they all have merits.
“The answer is all of them because it’s such a small universe,” he explained during the conversation. “I know I’ve maybe got my blinkers on here in terms of being a uranium bull, but again, a rising tide will lift all ships.”
Finegold reminded investors that the universe of uranium stocks is small, and said maintaining a diverse portfolio is important. In his view, a high weighting to producers Cameco and Kazatomprom (LSE:KAP) makes sense, as does a large allocation to sequesterers like the Sprott Physical Uranium Trust (TSX:U.U). Explorers and developers would round out the list.
Watch the interview above for more of his thoughts on uranium, including supply, demand and pricing.
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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.
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