Steve Schoffstall — Sprott's Rare Earth ex-China ETF (REXC)
"This is the only ETF anywhere that is solely focused on providing rare earth exposure."
One-line take: A product sponsor pitching his own fund, so read the stance as Sprott's. Rare earths are 17 chemically similar elements — not actually rare, just rarely found in concentrations worth mining — used in defense (missile guidance, radar), AI data-center cooling motors, screens, phone vibration magnets, robotics, wind turbines and EV motors. China took the industry from the US over ~30 years and now controls ~69% of mining and over 90% of refining and magnet production; its export controls are pushing Western governments to fund reshoring (the host notes dysprosium going from $100 to $900/kg). Sprott's answer is REXC, the Rare Earths ex-China ETF: a pure-play screen of ~1,000 miners twice a year, keeping only companies with ≥50% of revenue from rare earths, giving ~96% rare-earth exposure against single digits to high-20s for "rare earth" ETFs that are really diversified. 34 holdings; ~48% Australia / 40% US / 8% Canada; ~38% large, ~16% mid, rest small cap. Timestamps link into the video.
1. Stocks & names mentioned
| Ticker | Name | Research | View | What he said | At |
|---|
| REXC | Sprott Rare Earths ex-China ETF | QT · SA · STK · FA | Positive | His own firm's fund, so a sponsor's pitch: "the only ETF anywhere that is solely focused on providing rare earth exposure." A pure-play screen of ~1,000 miners twice a year keeps only companies with at least 50% of revenue from rare-earth mining, smelting or production, for ~96% rare-earth exposure versus single digits to high-20s in rivals that are "very diversified" or "concentrated in other metals." Ex-China by design, to catch Western reshoring incentives. 34 holdings: ~48% Australia, ~40% US, ~8% Canada; ~38% large cap, ~16% mid, the rest small. | 4:05 |
"View" is Steve Schoffstall's stance in this conversation (Positive / Neutral / Negative), not a price rating — and as a member of Sprott's ETF team talking about Sprott's own fund, it is a sponsor's view, not an independent one. At 6:26 he says viewers can "view everything about REMX" on sprottetfs.com — almost certainly a slip for REXC (REMX is VanEck's Rare Earth/Strategic Metals ETF, the kind of diversified competitor he contrasts REXC against), so REMX is not tabled. No individual holdings are named. Research: QT Qualtrim · SA Seeking Alpha · STK Stock Analysis.
2. Talking points
0:19 What rare earths are — and why they aren't rare
- 17 chemically similar elements, a subset of the broader "critical materials" umbrella. They are found throughout the earth's crust; what makes them "rare" is that they are seldom concentrated enough to mine economically.
0:57 Where they are used
- Defense (missile guidance, radar); AI data centers (the motors that keep them cool) and optics; display colours on TVs and phones; the magnet that makes a phone vibrate; robotics; wind turbines; and the magnets in EV motors — uses people "just take for granted."
2:21 China took the industry over three decades
- The US was the leading producer in the early-to-mid 1990s. Today China controls ~69% of mining and over 90% of refining and magnet production.
- Export controls (not the first time) make it harder for other countries to get materials "so critical to things like national and economic defense," so Western governments are funding programs to reshore production.
3:26 Prices "going through the roof"
- The host's example: dysprosium, used in magnets (DyTb), has gone from $100/kg to $900/kg because of the export restrictions — "the investment case for these rare earth elements."
4:05 REXC: the pure-play screen
- Sprott screens about a thousand mining companies twice a year, reading the financials to see what each actually produces, and keeps those with at least 50% of revenue from rare earths (mining, smelting, production). Ex-China to target reshoring incentives in Western countries.
5:18 Look past the fund's name
- Other funds marketed as rare-earth ETFs turn out to be "very diversified" or concentrated in other metals, with rare-earth exposure from 5–6% to the high 20s. REXC is ~96% rare earths.
5:41 The portfolio: 34 names, three countries
- ~48% Australia, ~40% United States, ~8% Canada (95–96% combined). By size: ~38% large cap, ~16% mid cap, the rest small cap.
6:03 Where to learn more
- sprottetfs.com, including an insights section with monthly commentaries and video content on critical materials, precious metals and rare earths. (He names the fund "REMX" here — a slip for REXC.)
3. In plain English
A jargon-free summary of the thesis behind each pick — what it actually is and why he holds that view. (Plain-language companion to the table above; renders on each ticker's consolidated page.)
REXC — Sprott Rare Earths ex-China ETF Positive
Rare earths are a group of 17 metals that go into strong magnets and electronics — fighter-jet and missile systems, electric-car motors, wind turbines, phone screens and the cooling motors in AI data centers. China mines most of them and does almost all of the processing into usable magnets, and it has started restricting exports. That has sent some prices sharply higher and pushed the US, Australia and Canada to pay for their own supply chains.
REXC is an exchange-traded fund (a basket of stocks you buy like a single share) that holds only rare-earth companies outside China. Sprott's selling point is purity: a company gets in only if at least half its revenue comes from rare earths, so the fund is about 96% rare earths, while other funds sold as "rare earth" funds are mostly other metals. It holds 34 companies, mostly in Australia and the US, and more than half the money is in small and mid-sized miners — which tend to swing much more in price. Keep in mind the person pitching it works for the company that sells it.
Summary & timestamps derived from the public YouTube video (transcript in transcript.html) for personal study. Not investment advice. © Jimmy Connor / Sprott Asset Management for source material.