The copper price is expected to explode. Is this the best way to take advantage of it?

The world is facing a massive copper shortage that is rapidly increasing, driven by rising demand from AI data centers amid shrinking supply. Projections show that global copper demand could rise 50% to 42 million tonnes in 2040, with production peaking at 33 million tonnes in 2030, leaving a shortage of 10 million tonnes. AI facilities alone consume 40,000 to 50,000 tons each, while the need for copper in data centers increases from 1.1 million tons in 2025 to 2.5 million in 2040.

Yet new mines are not opening fast enough to bridge the gap, which is exacerbated by underinvestment, while investing in copper mines comes with inherent risks. However, there is one stock that is potentially a superior vehicle to benefit from the impending copper price explosion.

Direct exposure without the risks of mining

United States Copper Index Fund (CPER) is an ETF designed to track the performance of copper prices through futures contracts. Managed by United States Commodity Fundsit is intended to reflect the daily percentage changes of the Total Return SummerHaven Copper Indexwhich consists of one to three eligible copper futures contracts traded on the COMEX.

Unlike traditional stocks, CPER offers investors a simple way to gain exposure to the spot price movements of copper, without having to use physical metal or navigate directly through complex derivatives.
In many ways, CPER is similar to precious metals ETFs SPDR Gold Shares (GLD) and iShares Silver Trust (SLV). All three are commodity-focused funds that allow retail and institutional investors to bet on metal prices through exchange-traded products. GLD and SLV hold physical bullion in vaults, allowing their values ​​to closely track gold and silver spot prices, but CPER uses futures contracts to achieve similar tracking, which can introduce elements such as roll yields due to contract expirations, but still provide an effective price correlation.

This structure makes CPER a ‘copper equivalent’ in the ETF space, often bundled with GLD and SLV for diversified metals portfolios. With an expense ratio of 1.06% and assets under management of approximately $934 million, CPER is accessible and liquid.

The superior choice for copper exposure

What sets CPER apart as potentially the better way to invest in copper is its unique focus on the metal’s price dynamics, which sidesteps the operational and geopolitical risks facing mining companies. Miners love Freeport-McMoRan (FCX) face disruptions due to natural disasters, labor issues or regulatory hurdles, which can decouple their stock performance from copper prices. For example, the Grasberg mudslide last September not only slowed production, but also tightened global supply, ironically pushing up copper prices while hurting miners’ production. CPER avoids such company-specific volatility by linking directly to futures, thus capturing pure price increases due to supply crunches and rising demand.
Although CPER does not own physical copper, as GLD does own gold or SLV silver, this futures-based approach is well suited to the copper market. Physical storage of industrial metals such as copper is logistically challenging and expensive due to their large volume and industrial use. Futures provide a “clean” proxy, especially as copper prices are under immense pressure from AI-powered electrification and chronic underinvestment in mines.

In short

If silver is the “poor man’s gold,” then a recent article calling copper the “poor man’s silver” is apt. CPER, trading below $37 per share, is up 27% over the past year but remains undervalued amid the brewing supply crisis.

This presents an attractive opportunity to invest in this crucial commodity before prices soar, driven by continued demand and limited supply.