Recent geopolitical tensions have heightened focus on the rare earths and permanent magnet sector. While避险情绪 from the Iran-Israel conflict has caused short-term fluctuations in industrial metal prices, the fundamental price support relies on supply-demand dynamics. As a typical strategic minor metal, rare earths benefit from both resource scarcity and robust downstream demand, amplified by global supply chain restructuring and policies emphasizing self-sufficiency in critical minerals. These factors are expected to underpin the sector's medium to long-term performance.
On the news front, the U.S. is set to host a significant minerals event with Brazil next month, aiming to promote a so-called "de-risked" supply chain for critical minerals. This move indirectly underscores the strategic value of rare earths as a key asset in major power competition. Rare earth permanent magnets are indispensable common key materials in advanced manufacturing sectors such as satellites, robotics, and the low-altitude economy, with their strategic importance being globally repriced.
Driven by tightening supply-demand conditions and a reassessment of strategic value, the rare earth sector continues to attract capital. As of the latest data, ETFs tracking the CSI Rare Earth Industry Index have seen a net inflow of 1.487 billion yuan over the past month. Among them, Rare Earth ETF (516780), the market's first rare earth industry-themed ETF, recorded a net inflow of 628 million yuan during the period, making it the only product tracking the index with inflows exceeding 500 million yuan and a primary vehicle for capital allocation in the rare earth sector. Sustained inflows have pushed its fund units and net asset value to 1.713 billion units and 3.801 billion yuan respectively, both reaching new highs since November 2025.
It is reported that Rare Earth ETF (516780) and its feeder funds (Class A 014331, Class C 014332) closely track the CSI Rare Earth Industry Index, whose constituents cover various segments of the industry chain including mining, processing, trading, and application of rare earths, potentially serving as an effective tool for investors to capture opportunities in the rare earth industry. As of the latest data, the index's top five constituents are Northern Rare Earth, Goldwind Science & Technology, Xiamen Tungsten, Aluminum Corporation of China, and GEM Co., Ltd., all of which are competitive leading enterprises in the industry.
The mid-2025 product report shows that as of June 30, 2025, Rare Earth ETF (516780) had 32,100 holders, making it the only rare earth-themed ETF in the market with over 20,000 holders during the same period.
The fund manager of Rare Earth ETF (516780) and its feeder funds (Class A 014331, Class C 014332), Huatai-PineBridge Fund, is one of China's first ETF managers. For years, it has been committed to providing investors with index tools characterized by transparency, convenient trading, and low fees. Two of its flagship ETF products—Huatai-PineBridge CSI 300 ETF (510300) and Huatai-PineBridge CSI 500 ETF (563360)—are highly popular in the market, currently ranking first in scale among similar ETFs. Their management fee of 0.15% per annum and custody fee of 0.05% per annum are among the lowest tiers for equity index funds in the market.
Risk Warning: Funds carry risks, investment requires caution.
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