On February 1, 2023, Sprott Asset Management announced the launch of four Exchange Traded Funds (ETFs): Sprott Energy Transition Materials ETF (Nasdaq: SETM), Sprott Lithium Miners ETF (Nasdaq: LITP), Sprott Junior Uranium Miners ETF (Nasdaq: URNJ) and Sprott Junior Copper Miners ETF (Nasdaq: COPJ).
Please Note: This FAQ is not wholly inclusive of all relevant information. Investors should consult the prospectus for more information, or please reach out to your Sprott representative at 888.622.1813 or firstname.lastname@example.org for additional questions.
The Sprott Lithium Miners ETF is listed on Nasdaq® under the symbol “LITP.” Investors can purchase LITP in a brokerage account or by contacting their financial advisor.
The Sprott Lithium Miners ETF (LITP) seeks to provide investment results that, before fees and expenses, correspond generally to the total return performance of the Nasdaq Sprott Lithium Miners™ Index.
The Nasdaq Sprott Lithium Miners™ Index is designed to track the performance of a selection of global securities in the lithium industry. The Fund will, under normal circumstances, invest at least 80% of its total assets in securities of this Index.
The energy transition is a significant global structural change intended to decrease our dependence on fossil fuels in favor of low-carbon and renewable energy. While we believe fossil fuels will likely continue to play a role in our future, substantial global investment and government mandates in favor of low-carbon and renewable energy are driving opportunities in the energy transition industry.
The index combines Sprott’s decades of experience in the mining sector with Nasdaq’s renowned index expertise. To be eligible for inclusion in the Nasdaq Sprott Lithium Miners™ Index (NSLITP™), a company must meet the requirements that follow.
Constituent Weighting Process
Investors that seek pure-play2 access to lithium through companies that are upstream in the supply chain. Lithium miners may be well positioned to benefit from increased investment in the low-carbon and renewable energy sector.
Sprott Asset Management USA, Inc. is the investment adviser to the Sprott Lithium Miners ETF. ALPS Advisors, Inc. is the sub-adviser, and ALPS Fund Services, Inc. serves as the administrator. ALPS Distributors, Inc. is the Distributor for the Sprott Lithium Miners ETF and is a registered broker-dealer and FINRA Member. Additionally, State Street Bank and Trust Company serves as the custodian and transfer agent.
Increased investment is driving growth in the critical minerals necessary for the energy transition
Lithium is a vital component in the batteries used in the growing hybrid and electric vehicle (EV) markets
Electric vehicles are the largest consumers of lithium, and demand for this critical mineral is expected to increase significantly
The Sprott Lithium Miners ETF is the only* ETF to provide pure-play exposure to lithium mining equities essential to the electric vehicle revolution
Clean energy is energy that has zero carbon emissions and comes from renewable and nuclear energy sources. Currently, nations around the world have committed to the Paris Agreement, which is a legally binding international treaty on climate change. It was adopted by 196 Parties at COP 21 in Paris in December 2015. Its goal is to limit global warming to well below 2, preferably to 1.5 degrees Celsius, compared to pre-industrial levels. To meet this goal, emissions need to be reduced by 45% by 2030 to reach net-zero by 2050.11
Critical minerals are natural materials that are essential to the generation, transmission and storage of clean energy. Sprott focuses on lithium as a major battery metal that is crucial to energy storage and the batteries powering the electric vehicle revolution.
We believe the Sprott Lithium Miners ETF has broad appeal to many investors. The following general themes are driving investor interest.
The Sprott Lithium Miners ETF expects to declare and distribute all its net investment income, if any, to shareholders as dividends at least annually and on a pro-rata basis. The Fund may distribute such income dividends and capital gains more frequently, if necessary, to reduce or eliminate federal excise or income taxes on the Fund.
Please reach out to your Sprott representative at 888.622.1813 or email@example.com for additional questions.
* Based on Morningstar’s universe of Natural Resources Sector Equity ETFs as of 6/30/2023.
1 The intensity score for stocks with revenue and for which revenue is deemed to be an appropriate characteristic is the percentage of their revenue attributable to the aforementioned strategy of the index.
2 The term “pure-play” relates directly to the exposure that the Fund has to the total universe of investable, publicly listed securities in the investment strategy.
3 Source: Energy Transition Investment Trends 2024, BloombergNEF.
4 Source: “U.S. Crosses the Electric-Car Tipping Point for Mass Adoption,” Bloomberg, July 9, 2022.
5 Source: Electrified Transport Market Outlook 4Q 2023, BloombergNEF, January 29, 2024.
6 Source: Reuters, December 8, 2021.
7 Source: “Which brands are going fully electric and by when?” CarExpert, August 14, 2021.
8 Source: “Critical Minerals Market Review”, International Energy Agency (IEA), July 2023. Data shown for Net Zero Emissions Scenario.
9 Source: “Lithium Mining: How new production technologies could fuel the global EV revolution,” McKinsey & Company, April 12, 2022.
10 Source: The Associated Press, via ABC News, November 16, 2022.
11 United Nations Framework Convention on Climate Change (UNFCC).
12 Incentive price is the price at which new mining production is reasonably profitable.
An investor should consider the investment objectives, risks, charges, and expenses carefully before investing. To obtain a Sprott Lithium Miners ETF Statutory Prospectus, which contains this and other information, visit https://sprottetfs.com/litp/prospectus, contact your financial professional or call 888.622.1813. Read the Prospectus carefully before investing.
The Fund is not suitable for all investors. Investors in the Fund should be willing to accept a high degree of volatility in the price of the Fund's shares and the possibility of significant losses. An investment in the Fund involves a substantial degree of risk. The Fund is considered non-diversified and can invest a greater portion of assets in securities of individual issuers than a diversified fund. As a result, changes in the market value of a single investment could cause greater fluctuations in share price than would occur in a diversified fund.
Shares are not individually redeemable. Investors buy and sell shares of the Sprott Lithium Miners ETF on a secondary market. Only market makers or "authorized participants" may trade directly with the Fund, typically in blocks of 10,000 shares.
Funds that emphasize investments in small/mid-cap companies will generally experience greater price volatility. Diversification does not eliminate the risk of investment losses. ETFs are considered to have continuous liquidity because they allow an individual to trade throughout the day. A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses, affect the Fund’s performance.
The Sprott Lithium Miners ETF seeks to provide investment results that, before fees and expenses, generally correspond to the total return performance of the Nasdaq Sprott Lithium Miners™ Index (NSLITP™).
Nasdaq®, Nasdaq Sprott Lithium Miners™ Index, and NSLITP™ are registered trademarks of Nasdaq, Inc. (which with its affiliates is referred to as the “Corporations”) and are licensed for use by Sprott Asset Management LP. The Product(s) have not been passed on by the Corporations as to their legality or suitability. The Product(s) are not issued, endorsed, sold, or promoted by the Corporations. THE CORPORATIONS MAKE NO WARRANTIES AND BEAR NO LIABILITY WITH RESPECT TO THE PRODUCT(S).
Sprott Asset Management USA, Inc. is the investment advisor to the Sprott Lithium Miners ETF. Sprott Asset Management LP is the Sponsor of the Fund. ALPS Distributors, Inc. is the Distributor for the Sprott Lithium Miners ETF and is a registered broker-dealer and FINRA Member.
ALPS Distributors, Inc. is not affiliated with Sprott Asset Management LP.
You can purchase and trade shares of Sprott ETFs directly through your online brokerage firm; these firms may include:
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