Bruno del Ama: Powered by Lithium

The Energy Report: Bruno, your firm recently launched the Global X Lithium ETF (NYSE:LIT). Why lithium? Why now?

Bruno del Ama: Lithium is of huge interest today for a number of reasons. The primary reason is that demand for lithium is growing by about 10% a year. Most of that growth is fueled by lithium-based batteries used in small consumer appliances, cell phones and laptops, as well as other portable electronic devices.

What really hasn't been factored into that growth is lithium-ion batteries used in electric vehicles. Lithium-ion batteries are the best technology and all new hybrid and electric vehicles are adopting it. The amount of lithium that's required for electric vehicles is much, much larger than what is needed for a laptop, for example.

That growth hasn't been factored into a market that's already growing very quickly. We expect the electric vehicle and hybrid market to grow very significantly from where it is today, which is basically non-existent. That should have a tremendous impact on the demand for lithium.

TER: But why form an ETF for lithium?

BDA: It's basically impossible to invest in lithium today. There's no futures market for lithium. There are no other investable products for lithium. The only way to invest in lithium today, or until these products are available, is to buy individual stocks in lithium mining or processing companies. What this ETF does is provide an easy package for investors to get access to the full lithium market.

TER: What type of investor is investing in the Lithium ETF? (more)