This ETF is LIT. Is Global Tech Lithium & Battery a EV portfolio must have?

Author: Kevin Stillerman

Electric Vehicle Content Writer

Tesla (TSLA) is not the only way to capitalize on the EV revolution. The Global X Lithium & Battery Tech ETF (LIT) invests in the full lithium cycle, from mining & refining the metal, through battery production.

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Disclaimer: The following article is for your information only. It does not constitute investment advice.

Building an EV Investment Portfolio

The EV revolution is upon us, and investors are eager to capitalize on this electric vehicle movement. Tesla Inc currently dominates the EV market, and as an outcome its stock (TSLA) is nearly 10X in value from just 1 year ago.

While TSLA is without a doubt the number one stock that should be in your EV portfolio, there are other EV options that can help you diversify and potentially further increase your gains.

As we all know, electric vehicle are powered by lithium ion batteries. So where do lithium ion batteries come from? There are countless supporting industries and businesses that are required to feed EV companies such as Tesla with massive amount of battery cells.

Supporting industries include the mining and refining of the lithium and raw materials all the way through the final battery production process.

What is LIT?

Are you ready to get LIT!? The Global X Lithium & Battery Tech ETF (LIT) invests in the full lithium cycle, from mining and refining the metal, through battery production.

Purchasing a share of LIT allows an investor to buy into the EV battery cell production market segment (rather than investing in an individual EV stock). For this reason it is a more diversified option.

Here is a current list of LIT’s top 10 holdings:

Company

ALBEMARLE CORP

LG CHEM LTD

SAMSUNG SDI CO LTD

TESLA INC

GANFENG LITHIUM CO LTD-A

Ticker

ALB

051910KS

006400KS

TSLA

002460C2

Asset %

11.88%

5.30%

5.27%

5.17%

5.14%

BYD CO LTD-H

PANASONIC CORP

QUIMICA Y-SP ADR

EVE ENERGY CO LTD-A

CONTEMPORARY A-A

1211HK

6752JP

SQM

300014C2

300750C2

5.11%

5.09%

4.58%

4.46%

4.23%

LIT has holdings in global companies spanning 11 countries. The countries with the highest % of net assets are China (43.3%), United States (22.0%), and South Korea (11.7%). This is an additional benefit of LIT, the ability to buy into companies which trade in foreign markets that are not readily accessible in the US markets. 

For example, if you are an investor who would like to add LG Chem, Samsung, or Panasonic (all of which help support Tesla’s battery production) to your portfolio, but do not feel comfortable or have access to trading in the Korean Exchange (KRX) or or Tokyo Japan exchange (JP) then purchasing LIT provides an option to buy into these stocks. 

More About LIT

Unlike some other EV investment options which have only been around a few years (or even a few months), LIT is a well established ETF that originated back in 2010. 

Over the past 52 weeks, LIT has more than doubled in value from ~$25/share to over ~$50/share.

Source: Seeking Alpha

This increase is heavily tied to all of the positive recent news regarding Tesla including the announcement of their new 4680 battery cells, production ramp up and sale of vehicles in the China market via Giga Shanghai, progress on their new manufacturing facilities Giga Berlin & Giga Texas, and most recently their inclusion into the S&P500. 

LIT has holdings in 4 key market sectors: Materials, Industrials, Information Technology, and Consumer Discretionary.

While LIT typically trends with Tesla, if offers investors additional gain potential as automotive companies begin to offer more and more electric vehicle options requiring lithium ion battery cells.

The electric vehicle industry has shown that it is here to stay as demand in EVs continues to increase with a rising wave of green technology. And as the saying goes, a rising tide lifts all boats….or in this case cars!

Summary

There are other great EV investment options out there other than just TSLA! The LIT ETF offers a great way to diversify your EV portfolio by investing in companies that support the production of lithium ion battery cells that power the growing number of electric vehicles offered by automotive companies. 

 Are you ready to get LIT? Leave a comment below and join the conversation!

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Sources

Tesla

Global X ETFs

Seeking Alpha