Cobalt is one of the most rare, expensive and sought-after metals on the market. But an investment in cobalt is far from foolproof. Investors should be wary of the dangerous and violent conditions that contribute to instability in cobalt acquisition before investing.
What is cobalt and how is it used?
Cobalt is a hard, metallic element used to manufacture batteries, magnets, paints and chemical catalysts. It’s rare, valuable and in increasingly high demand thanks to the rise of electric vehicles.
Over two-thirds of the world’s cobalt is mined in the Democratic Republic of Congo. Other major cobalt producers include Cuba, Russia, Australia and the Philippines.
Why invest in cobalt stocks?
It’s no secret that the tide of vehicle manufacturing is shifting. Thanks to environmental movements worldwide, electric vehicles have become less of a novelty and more commonplace than ever before.
And what do electric vehicles need to function? Batteries.
Cobalt is an essential part of the electric vehicle manufacturing process, as it’s a key component of lithium-ion batteries. Many industry experts expect the demand for cobalt to rise in the coming years with the projected impact of electric vehicles on the automotive market.
Risks of investing in cobalt
A major risk facing cobalt investors is the location of the majority of the world’s cobalt supply: the Democratic Republic of Congo (DRC). Historically, the DRC has been marked by political instability and civil unrest. Volatile political shifts have the potential to impact supply chains and security for cobalt operators in the DRC is far from guaranteed. The process of cobalt mining is also fraught with conditions that violate human rights.
As a result of the unstable and violent conditions that surround cobalt acquisition, a number of companies that rely on it, including Tesla, are actively seeking a workaround to avoid overreliance on the difficult-to-procure metal. As electric vehicles become more popular, some manufacturers are working to develop methods of electric power that reduce or eliminate the need for cobalt.
That said, such a solution is still many years from mass production. Industry experts suggest electric vehicles will continue to rely on cobalt.
Most of the companies on this list don’t deal exclusively in cobalt — the mining and refining of cobalt is typically conducted in conjunction with another metal. Most cobalt stocks require an international brokerage account to trade, as few of these multinational companies trade on US exchanges.
Of the following list, only Vale and Wheaton Precious Metals Corporation trade on the New York Stock Exchange. All others must be purchased over-the-counter or from international exchanges.Select a company to learn more about what they do and how their stock performs, including market capitalization, the price-to-earnings (P/E) ratio, price/earnings-to-growth (PEG) ratio and dividend yield. While this list includes a selection of the most well-known and popular stocks, it doesn't include every stock available.
Compare domestic trading platforms
Some cobalt stocks, like Vale and Wheaton Precious Metals, are available on the NYSE. That means you can easily purchase them with any brokerage account. The table below compares some of the most popular US brokers.
But if you plan to heavily trade cobalt, you’ll want to compare international brokerage accounts that offer access to foreign exchanges.
*Signup bonus information updated weekly.
Cobalt plays an important role in our modern society, contributing to the production of batteries, magnets and chemical catalysts. While its primary production lines in the DRC are far from stable, experts believe we will continue to need cobalt to produce electric vehicles in the coming years.
To invest in cobalt, you’ll likely need an international brokerage account. Compare your platform options to find the brokerage that best fits your needs.
Frequently asked questions
More guides on Finder
SoFi Invest alternatives
Check out apps like SoFi invest offering many of the same benefits and then some.
Investing strategy: How growth stocks can make you money
Learn how to strategically find and invest in booming companies.
Investing in your 30s: 8 wealth-building tips
Prepare to revamp your asset allocation and explore new investment classes.
How to start investing in your 20s: 7 tips for beginners
7 tips for starting a portfolio if you’re new to investing.
How can you use your health savings account (HSA) as a retirement investment?
A health savings account (HSA) can help you get prepared for your retirement. Learn more.
Biden plans another boost for electric car stocks
Biden’s plan to replace the federal fleet with American-made electric vehicles gives another boost to a red-hot sector led by Tesla.
Titan Invest review
Invest like a hedge fund with Titan Invest. Learn more.
How to invest during a stock market bubble
If we’re heading into a stock market bubble, you can take some steps to protect your investments.
Investing in pet stocks
Here’s what investors need to know about the rising pet market and how to capitalize on its potentially high growth potential.
The new Ark Space Exploration ETF prepares for takeoff — but is it worth the hype?
Ark Investment Management is launching a space exploration ETF. Here’s what we know about the fund and its potential competitors.
Ask an Expert