Uranium ETF Surges on Supply Squeeze and Policy Support

Global X Uranium ETF US37954Y8710

The Global X Uranium ETF (URA) is trading near $54.25, capitalizing on a pronounced supply-demand imbalance and fresh governmental backing. With assets under management of approximately $6.52 billion as of mid-January, this fund stands as the premier vehicle for gaining exposure to the uranium sector. A recent catalyst was the U.S. Department of Energy's announcement of $2.7 billion in funding to support domestic uranium enrichment, providing a clear boost to constituent holdings. Investors are now questioning whether this powerful rally has staying power.

URA has delivered impressive returns, though some technical indicators suggest the advance may be extended.

• Price and Returns: The current price is $54.25. Over the past year, the ETF has generated a return of +105.8%, accompanied by a trailing twelve-month dividend yield of 3.85% ($2.08).
• Technical Analysis: The price sits above its 20-day ($47.60) and 50-day ($46.03) moving averages. The Relative Strength Index (RSI) reading of 69.9 is approaching overbought territory. Immediate support is found at $51.53, with stronger support at $50.02. Resistance awaits at $57.26. A decisive break above $57.26 would support a continuation of the bullish trend, while a sustained drop below $50.00 could signal a potential reversal.
• Liquidity and Short Interest: Average daily trading volume is roughly 6.1 million shares. As of December 31, 2025, short interest stood at 4.98 million shares, representing 3.92% of the free float and marking a 6.38% decrease from the prior month. The days-to-cover ratio is 1.4.

A Concentrated Portfolio: Risks and Rewards

The ETF's strategy involves heavy weighting toward a select few industry leaders, amplifying both potential gains and single-stock risks.

• Top Holdings (Mid-January): Cameco Corp. (23.59%), Oklo Inc. (10.73%), Uranium Energy Corp. (UEC) (6.46%), Centrus Energy (LEU) (4.35%), and Energy Fuels Inc. (UUUU) (3.77%).
• The three largest positions alone account for nearly 41% of the fund, tethering its performance closely to Cameco and to regulatory or operational news concerning UEC and Oklo.
• Recent Movers: Uranium Energy Corp. (UEC) jumped 10.8% on January 14 following reports highlighting a U.S. uranium deficit exceeding 50 million pounds against domestic production of only about 1 million pounds. Energy Fuels (UUUU) rose 5.5% in the same period, though it trades at a price-to-book ratio of 6.6x, significantly above the sector average of 1.4x.

Market Drivers and Peer Comparison

Fundamental and policy factors are converging to support the sector, while URA leads its niche in scale.

• Key Catalysts: The DOE funding specifically benefits North American enrichers like Centrus. Analysts at Bank of America forecast the uranium spot price could rise to $130 per pound by the fourth quarter of 2026 (current price: $83.25/lb), which would support valuation multiples for miners. Geopolitical measures, including a proposed "price floor" concept for critical raw materials announced on January 14, offer additional protection for domestic producers.
• Upcoming Event: A significant shareholder vote at Uranium Energy Corp. scheduled for February 27, 2026, could clarify control and the operational outlook for UEC.
• ETF Comparison (AUM / 1-Year Return):
  • Global X Uranium ETF (URA): $6.52 billion / +105.8%
  • VanEck Uranium & Nuclear Energy ETF (NLR): $4.33 billion / +73.0%
  • Sprott Uranium Miners ETF (URNM): $2.15 billion / +61.3%
  • URA's expense ratio is 0.69%.

Conclusion: The current rally is underpinned by tangible factors—government support, supply deficits, and technical strength. However, vulnerability persists due to high portfolio concentration and valuation concerns surrounding specific holdings. A sustained upward trajectory will depend on the implementation of policy measures, the direction of spot prices, and upcoming corporate decisions, notably the February 27 vote. A clear breakout above $57.26 would bolster the momentum thesis, while a decline below $50.00 would significantly darken the outlook.