There is now sufficient volume to introduce these two materials into WisdomTree Energy Transition Metals (WENT) and WisdomTree Battery Metals (WATT) due their fit with the respective strategies, the fund manager said.
However, lithium and cobalt trade volumes remain low in comparison to other metals, WisdomTree said.
Therefore, the indices’ methodologies constrain the weights assigned to these two materials, which currently have target weights at rebalances for lithium and cobalt of 2.5% and 0.5%, respectively.
WisdomTree said inclusion of the metals in the two strategies, which were both launched last year, will lead to enhanced liquidity and price discovery in the wider market.
WENT offers investors access to key metals involved in the energy transition megatrend, such as copper, nickel, aluminium, silver, zinc tin, platinum, and now also lithium and cobalt.
Meanwhile, WATT allows investors to access the key metals involved in the battery theme, a sub-set of the energy transition megatrend. The index was comprised of nickel, aluminium, copper, and zinc and now lithium and cobalt.
WENT seeks to track the performance of the WisdomTree Energy Transition Metals Commodity Index TR, while WATT seeks to track the performance of the WisdomTree Battery Metals Commodity Index TR.
Explaining the move, WisdomTree said the ETFs, and indices they track, have been designed to be adaptive to market conditions.
This allows the fund manager to introduce materials important to the theme when a liquid futures market develops, and change weights according to the fundamental outlooks for these metals.
