Stockchase Insights VanEck Vectors Rare Earth/Strategic Metals ETF REMX-N DON'T BUY Jun 11, 2025

Trevor Rose’s Insights - Trevor’s most-liked answers from 5i Research

REMX has a 5-year annualized return of +3.59%. But its three-year is -23.57%. This shows the high volatility of the sector. The sector largely trades on sentiment towards EVs, electronics and China. Fees are 0.58%. Its weak performance has largely stemmed from its high exposure to China, when there was an 'avoid China' mentality in the market, and of course the country did experience an economic slowdown. It still has 31% exposure to China. A shift in sentiment would help here, but that is hard to time, of course. We might prefer a more-generalized metals ETF such as PICK (5-year +12.85%). It would not have the same upside in a rare earth rally, but doesn't have the same degree of performance pain, either.
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COMMENT

China controls about 90% plus of the rare earths market. It looks like there is a bottom developing. You need to see a breakout above $17.

COMMENT

ZMT has been a holding since mid last year. It has steel, aluminum, copper and other base metal mining holdings. The infrastructure re-building will see steel playing a big part. REMX focuses in rare earths. Would go with the larger base metal play than just base metals.

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