Big Money Banking on Bull Move in This Metal

Tuesday, 26 Jun 2012 | 6:52 PM ET

An expected surge in demand has big players making bullish bets on at least one metal. Know what it is?

It’s Lithium. And according to published reports JPMorgan and BlackRock are among the many Street savvy firms putting money to work behind the thesis.

Although its uses range from the treatment of bipolar disorder to the manufactures of ceramics – most people know lithium as a key component of electronics.

And with the market for tablets, smartphones and other gadgets absolutely exploding, it comes as little surprise that the demand for lithium from the electronics industry alone has grown 20% a year since 2000.

To make lithium all the more valuable, it’s widely believed that special lithium-ion battery will become the standard source of power for electric cars in the years ahead. (Click here to read "A123 Battery Maker Claims a Breakthrough")

Considering lithium is also used to make grease, glass and a slew of other materials, demand could shoot through the roof.

Want to get in on the trade?

Byron Capital Markets analyst Jon Hykawy explained how onCNBC's Fast Money.

Lithium: Strangest Bull Market You Never Heard Of?
Investment banks like JPMorgan and Blackrock are banking on a bull move you probably never heard of, with Jon Hykawy, Byron Capital Markets.

If you’re looking for a pure play, Hykawy suggests a long position in Talison Lithium which trades in Toronto. He has a buy rating on the stock.

However, if you’d prefer to trade domestically, Hykawy suggests looking at Philadelphia-based FMC Corp which derives a portion of its business from lithium. Or he also recommends lookin at Chile-based Sociedad Quimica y Minera, which trades on the NYSE as an ADR.

In addition, trader Steve Grasso, director of institutional sales Trading at Stuart Frankel, reminds the desk that a Lithium ETF trades on the NYSE under the symbol LIT. It’s made up of FMC, SQM as well as many other holdings.

Posted by CNBC's Lee Brodie

Read More from Fast Money:

> Simple Strategies Behind Supersized Successes

> 10 Top Stocks for the Long-Term Investor

> Top Apple Related Stocks for 2012

Got something to to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap. If you'd prefer to make a comment, but not have it published on our Web site, send those e-mails to fastmoney@cnbc.com.

Trader disclosure: On June 26, 2012 , the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Joe Terranova is long VRTS; Joe Terranova is long MCD; Joe Terranova is long PNC; Joe Terranova is long USB; Joe Terranova is long TCBI; Joe Terranova is long SBUX; Joe Terranova is long WMB; Joe Terranova is long SJM; Joe Terranova is long UPC; Joe Terranova is long WFM; Joe Terranova is long LPX; Joe Terranova is long SNDK; Joe Terranova is long IBM; Joe Terranova is long HYG; Joe Terranova is long AAPL; Joe Terranova is long EMC; Joe Terranova is long NXPI; Joe Terranova is long CNX; Steve Grasso is long ASTM; Steve Grasso is long BA; Steve Grasso is long D; Steve Grasso is long FRO; Steve Grasso is long LNG; Steve Grasso is long MHY; Steve Grasso is long MO; Steve Grasso is long PFE; Steve Grasso is long S; Steve Grasso is long VLO; Steve Grasso is long XLU; Steve Grasso is long ZAZA; Mike Murphy is long INTC; Mike Murphy is long TGT; Mike Murphy is long LNG; Mike Murphy is long SBUX; Mike Murphy is short WMT; Simon Baker is funds long AAPL; Simon Baker is funds long CVX; Simon Baker is funds long WFC; Simon Baker is funds long V; Simon Baker is funds long DIS

For Ron Insana
Nothing to Disclose

For David Bank
Nothing to Disclose

For David Strasser
Janney Montgomery Scott LLC currently acts as a market-maker in the securities of WMT
Janney Montgomery Scott LLC intends to seek or expects to receive compensation for investment banking services in the next three months from WMT
The research analyst is compensated based on, in part, Janney Montgomery Scott's profitability, which includes its investment banking revenues.

For Jon Hykawy
Nothing to Disclose

For Ed Morse
Analysts' compensation is determined based upon activities and services intended to benefit the investor clients of Citigroup Global Markets Inc. and its affiliates ("the Firm"). Like all Firm employees, analysts receive compensation that is impacted by overall firm profitability which includes investment banking revenues.

CNBC.com with wires.

  Price   Change %Change


Contact Fast Money

  • Showtimes

    Halftime Report - Weekdays 12p ET
    Fast Money - Weekdays 5p ET
  • Melissa Lee is the host of CNBC's “Fast Money” and “Options Action.”

  • Scott Wapner is host of the "Fast Money Halftime Report," which airs weekdays from 12 p.m. to 1 p.m. ET.

  • Guy Adami is a contributor on CNBC's "Fast Money." He also is managing director of stockMONSTER.com.

  • Najarian, the "Pit Boss," is cofounder of optionMONSTER.com, a news site for options traders.

  • Finerman is president of Metropolitan Capital Advisors, Inc., a company she co-founded.

  • Founder of EmergingMoney.com

  • Chief Market Strategist for Virtus Investment Partners & CNBC Contributor

Halftime Report