Should you invest in copper?

With all the emphasis on investing in gold given the yellow metal’s surge in recent months, it can be tempting to overlook its more industrial cousins.

Gold investing is all the rage, with the yellow metal surging as investors look to hedge themselves against disruption in the equity markets or inflation that could result from Trump’s tariff regime.

But ignoring copper could be a mistake. Prices of the conductive metal hit an all-time high on 6 January, rising to above $6 per pound amid expectations that supply would fall in 2026.

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While prices have since fallen to around $5.8 on 8 January, investors taking a longer-term perspective might want to consider investing in copper, alongside gold or other commodities. Between 2 January 2025 and 8 January 2026, the price of a pound of copper rose around 43%.

Copper’s main industrial usage is in the energy sector as it is a good electrical and thermal conductor, and with demand for energy projected to keep getting higher, the demand for good conductive materials is also expected to increase.

Its range of industrial use cases also means that the copper market is often viewed as a bellwether for the global economy.

So is it worth investing in copper? And how can you gain exposure if so?

Why are copper prices rising?

Copper prices reached an all time high of $6.13 per pound on 6 January after traders expected supply disruptions to push up prices in 2026.

Global copper supply is still recovering from several disruptions at major copper mines last year, including one tragic accident in September 2025 at the Grasberg copper mine in Papua, Indonesia, the world’s second-largest copper mine, which led to decreased output.

Workers at Capstone Copper’s Mantoverde copper mine in Chile have also gone on strike, leading to a further constriction in supply.

The tariff threat also looms large over the copper market. Worries that Trump will impose tariffs on the metal have led traders to ship large quantities into the USA to pre-empt any potential new taxes.

The supply disruptions come at a time when demand remains high for copper, and is expected to grow.

Tom Bailey, Head of Research at HANetf, said: “Copper’s rally to record highs is being driven by a combination of supply tightness and policy-driven market distortion, rather than any single geopolitical flashpoint.

“A series of disruptions at major mines, including Grasberg in Indonesia and Kamoa-Kakula in the DRC, alongside labour action in Chile, has pushed the market into deficit at a time when ageing assets, declining ore grades, and long development timelines are already constraining supply.”

As the metal is the go-to common electrical and thermal conductor for industrial usages, lots of it is typically needed when building electrical infrastructure. This includes infrastructure that generates electricity, but also infrastructure that uses electricity – especially power-hungry buildings like artificial intelligence data centres.

As demand for electricity is expected to increase in the long-term, more copper will be needed to build infrastructure for the green energy transition.

Copper is also a key commodity for modern defence technology. “Copper is embedded across modern military supply chains, from ammunition and artillery to advanced electronics and communications systems,” Bailey added. “As geopolitical uncertainty rises and the US places greater strategic emphasis on the Western Hemisphere, European policymakers are being forced to confront a future in which defence spending is structurally higher and industrial capacity must be rebuilt domestically.”

Which factors impact copper prices?

Duncan Hobbs, research director at Concord Resources, told MoneyWeek there are three main influences on copper prices.

The first is the “fundamental status”: the balance between physical copper supply and demand. Naturally, if demand outstrips supply, this acts to increase copper prices, and vice versa.

The second factor is influenced by this and pertains to broader macroeconomic environments – major disruptions to trade, like those coming from Trump’s mercurial tariff policy.

Hobbs said: “You can sometimes get a situation where the fundamental assessment of the supply and demand balance would lead you to expect prices to trade in one direction, but broader macroeconomic and political considerations push prices in another direction.”

For that reason, he says, the fundamental balance has to be layered with the macroeconomic outlook.

The third factor influences short-term copper prices, over weeks and months rather than years and decades. That is financial positioning: effectively, a consideration of how copper market participants have deployed money.

If investors generally expect copper prices to rise in future, they will build long positions, often in futures markets. If the hypothesis is correct and copper prices rise, they will naturally want to take some profit. That can lead to short-term periods where the price of copper falls, even against a longer-term trend of rising prices.

Similar dynamics to this third effect also play out in equities markets.

How to invest in copper

There are several ways to invest in copper. Many professional copper traders will buy and sell futures contracts; however, that’s not generally recommended for retail investors as it is risky and involves a degree of speculation.

You can easily gain exposure to copper spot price movements with an exchange-traded commodity (ETC), though. An ETC is like an ETF, but rather than an index it tracks the price of one particular commodity.

“These are ideal for investors seeking pure-play exposure to the metal itself, without the added exposure of mining company performance,” says Lale Akoner, Global Market Analyst at eToro.

One example is WisdomTree Copper (LON:COPA). This London-listed ETC tracks the dollar price of copper.

You can also invest in copper mining ETFs. Like most ETFs these are bundles of stocks: the stocks will be those of copper mining companies.

The Sprott Copper Miners UCITS ETF (LON:COPP), for example, provides exposure to small-, mid- and large-cap copper miners.

“These funds tend to amplify movements in copper prices through equity exposure, potentially delivering higher returns (and risks) than the metal alone,” says Akoner.

Investors could also buy the shares of copper miners directly. Some major FTSE 100 companies like Antofagasta, Glencore (LON:GLEN) or Rio Tinto (LON:RIO) have large exposure to copper mining. Like copper mining ETFs buying these shares could amplify risks and returns compared to investing in copper ETCs (with less diversification to mitigate this risk and reward compared to buying a copper mining ETF).

“Finally, diversified commodity funds and investment trusts, such as BlackRock World Mining Trust (LON:BRWM) or JPM Natural Resources Fund can provide broader exposure,” says Akoner. “These vehicles typically hold positions across multiple metals and mining companies, including those focused on copper, making them a useful option for investors seeking a more balanced approach.”