The Nuclear Hedge: Investment Strategy and Viability
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In Bill Cara’s investment report titled “The Nuclear Hedge: Investment Strategy and Viability,” he argues that nuclear energy is a vital, non-correlated strategic asset for capital allocators navigating the global energy transition. The report first addresses the skeptical “bear” case, as presented by well-known energy analyst Art Berman, which claims the technology is commercially unviable due to massive Western construction costs and the failure of Small Modular Reactors (SMRs) to offer competitive pricing. Bill counters this by asserting that the value of “firm” low-carbon power dramatically increases as grids integrate more variable renewable sources, significantly boosting nuclear power’s effective profitability by offsetting battery and peaker plant needs. It also highlights that high costs are primarily a Western problem, contrasting the expensive construction in the US and Europe with the much faster and cheaper reactor builds seen in South Korea and China. Ultimately, Bill recommends allocating a portion of an alternatives portfolio to nuclear as an inflation and instability hedge, suggesting a structured investment strategy focused on liquid assets, uranium pricing, and achieving SMR construction milestones. He publishes his recommended portfolio in the report.
