Disconnect between rare earth stock and commodity prices is a …

Despite the sell-off in rare earth stocks as investors duck for cover ahead of a possible recession, the flow of capital continues to flood the rare earth sector to fund strong and growing demand for the material. This the second clue for a potential strong recovery. Recent examples of rare earth investments and … See more

FAQs about Disconnect between rare earth stock and commodity prices is a … Coupon?

Is there a disconnection between share prices and commodity prices?

The first clue lies in a disconnection between share prices and underlying commodity values with prices for leading players in the rare earth business falling even as prices for what they sell continue rising. Lynas Rare Earths (ASX: LYC) is the best example of the divergence between the stock and commodity markets. ...

Is rare earth a strategic value?

The strategic value of rare earth is highlighted during turmoil periods. Rare earth price rises when economic activity is high and vice versa. Broad application prospects of rare earth are in the energy transition. This paper investigates the correlation between rare earth prices, geopolitical risk and global economic activity. ...

Does China's Rare earth policy affect market power and price sensitivity?

Zhang et al. (2015) indicate that China's rare earth policies have exerted significant effects on market power and price sensitivity in the international market. There have been three significant increases in the historical trend of REP. ...

Why is rare earth a good investment?

Furthermore, the stable price of rare earth can be conducive to fewer trade frictions and geopolitical tensions. For investors, rare earth can provide a good hedge against geopolitical risks, which can be regarded as a good choice in investment portfolios. ...

What is the relationship between rare earth Price and global economic activity?

Regarding the relationship between rare earth price and global economic activity, the result shows that the price rises when economic activity is high and decreases when the economy is gloomy, supporting Hypothesis 3. ...

How does rare earth differ from other commodities and resources?

Hence, rare earth differs from other traditional commodities and resources because its wide applications and scarce supply intensify its geopolitical property, which means that rare earth is treated as a bargaining counter in political deals. ...