What are rare earth elements and why are they important?

Rare earth elements (REEs) are a set of 17 metallic elements that, despite their name, are relatively abundant in the Earth's crust but rarely found in concentrated, economically viable deposits. They're crucial ingredients in modern technology - powering everything from smartphone screens and computer hard drives to electric vehicle motors and wind turbines. Their unique magnetic, luminescent, and electrochemical properties make them irreplaceable in many high-tech applications, which is why they're often called the "vitamins" of the technology industry.

Why is there growing interest in rare earth element investments?

Interest is surging because of several factors: increasing demand from green technology and electronics, geopolitical tensions over supply chains, and the fact that production has historically been concentrated in just a few countries. As nations push for supply chain security and self-sufficiency in these critical materials, companies with mining and processing capabilities outside traditional sources are attracting attention. This creates potential investment opportunities as the world competes for these limited, essential resources.

Are rare earth element stocks risky investments?

Yes, they typically carry higher risk than more established sectors. These stocks can be volatile due to fluctuating commodity prices, geopolitical factors affecting supply chains, and the technical challenges of mining and processing these elements. Many companies in this space are still developing their projects rather than generating significant revenue. However, this higher risk comes with potential for substantial returns as global demand increases and supply diversification becomes a priority for many nations and industries.

What's the difference between miners, processors, and royalty companies in this portfolio?

Miners extract the raw materials from the ground, often focusing on exploration and development of rare earth deposits. Processors take those raw materials and refine them into usable forms for manufacturers - often a more complex and valuable part of the supply chain. Royalty companies don't operate mines themselves but provide financing to mining operations in exchange for a percentage of future revenue, offering investors exposure to the sector with potentially lower operational risks. This portfolio includes a mix of all three types to provide balanced exposure across the rare earth value chain.

How do ETFs like REMX fit into a rare earth elements investment strategy?

ETFs (Exchange Traded Funds) like REMX offer a way to invest in a basket of rare earth and strategic metals companies with a single purchase, providing instant diversification across the sector. This can help reduce the risk of investing in individual mining or processing companies, which may face project-specific challenges. Including an ETF alongside individual company stocks gives you both broad sector exposure and the potential for higher returns from promising individual projects - essentially balancing your risk and reward potential within this specialized sector.

13 handpicked stocks

King's Ransom

Own the building blocks of our technological future. This collection features carefully selected companies mining and processing rare earth elements - the irreplaceable ingredients powering everything from smartphones to electric vehicles. Handpicked by our expert analysts to capitalize on growing global demand.

Han Tan | Market Analyst

Published on June 17

Top Picks from This Group

Here are a few of the assets in this group. Create an account to unlock the full list.

MP Materials Corp.

Current price

$70.96

As the owner and operator of the Mountain Pass facility in California, it is the largest and most crucial rare earth mining and processing site in the...

As the owner and operator of the Mountain Pass facility in California, it is the largest and most crucial rare earth mining and processing site in the Western Hemisphere.

Energy Fuels Inc/Canada

UUUU

Current price

$16.87

This company is leveraging its White Mesa Mill to process and separate rare earth elements, in addition to its primary uranium business.

RAMACO RESOURCES INC

METC

Current price

$35.05

It is actively developing methods to extract rare earth elements and critical minerals from its existing coal mining operations and waste products.

Rio Tinto plc

RIO

Current price

$66.06

Teck Resources Limited

TECK

Current price

$43.38

Sizzle Acquisition Corp

CRML

Current price

$8.05

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About This Group of Stocks

Our Expert Thinking

Rare earth elements are the unsung heroes behind modern technology. As demand for electric vehicles, renewable energy, and advanced electronics grows, these limited materials become increasingly valuable. We've identified companies positioned to benefit from this accelerating global competition for tech's essential ingredients.

What You Need to Know

This portfolio focuses on miners and processors with direct operational control of rare earth elements and strategic metals. These stocks can be volatile but offer significant growth potential as nations worldwide seek to secure supply chains independent from dominant producers, creating a powerful catalyst for sector growth.

Why These Stocks

We've selected companies with established production facilities or near-term development projects across the rare earth supply chain. This mix provides exposure to different stages of extraction, processing, and commercialization, prioritizing those with significant projects in regions seeking supply chain independence.

Group Performance Snapshot

12 of 13

Stocks Rated Buy by Analysts

12 of 13 assets in this group are rated Buy by professional analysts.

7% vs 4%

Group Growth vs Bank interest

This group averaged a 7% return last month, beating the typical 4% bank rate.

Source: Analyst sentiment is provided by Refinitiv Ltd, a global leader in financial market data with over 40k business clients. Refinitiv Ltd is an independent third party to Nemo. This is not advice.

Why You'll Want to Watch These Stocks

🌐

Supply Chain Revolution

Nations are racing to secure their own rare earth supplies, reducing dependence on single sources. This geopolitical shift creates massive opportunities for companies developing new production outside traditional markets.

⚡

Hidden Tech Essentials

These aren't household names, but they produce the irreplaceable ingredients in nearly every device you own. As tech demand grows, so does the need for the rare minerals these companies control.

🚀

Green Energy's Secret Ingredient

Want to invest in clean energy's future? These companies provide the critical materials needed for EVs, wind turbines, and energy storage - positioning them at the foundation of the green revolution.

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