Why Trump's Nuclear Deal With Saudi Arabia Could Be Good News for These 2 Uranium ETFs

On July 22, President Donald Trump announced a deal to allow Saudi Arabia to enrich uranium to use as fuel for civilian nuclear power plants. There's some controversy about the deal and Congress has not yet approved. Saudi Arabia and Iran are major rivals in the Middle East. Critics argue that giving nuclear capabilities (even for peaceful purposes) to Saudi Arabia could lead to higher military tensions and even a nuclear arms race in the region.

But aside from questions of geopolitics and foreign policy, this deal is important to investors for a different reason. Trump's deal with Saudi Arabia shows that many countries, including oil-rich nations like Saudi Arabia, are looking to expand their production of nuclear energy. This would be good news for companies that mine uranium and manufacture nuclear reactors.

Two prominent nuclear energy and uranium mining exchange-traded funds (ETFs) might benefit from Saudi Arabia's nuclear deal and future growth of demand for nuclear power. Let's look at these two uranium stock ETFs and see if either fund could be a good buy.

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Global X Uranium ETF (URA): 53 stocks, five years of 20.2% annualized returns

The Global X Uranium ETF (NYSEMKT: URA) owns 53 stocks in companies that have business operations related to mining and refining uranium and making components for the nuclear power industry. As I write this, the fund's top stock holdings include:

• Cameco: 23.5% of the fund
• NexGen Energy: 6.6%
• Sprott Physical Uranium Trust Fund: 5.6%
• Oklo: 5.5%
• Uranium Energy: 5.2%

Investing in the uranium industry and nuclear stocks can be risky and volatile. This fund was established in November 2010. In the nearly 16 years since its inception, the Global X Uranium ETF has lost money -- with annualized returns (by net asset value) of -2.51%.

But in the past few years, with rising interest in nuclear power to generate electricity for AI data centers and meet other demands for energy, this fund has done better. It's delivered average annual returns (by NAV) of about 20.2% in the past five years, 31.9% in the past three years, and 17.6% in the past year.

Owning this fund is not cheap. It charges an expense ratio of 0.69%, which is quite a bit more costly than the best low-cost index funds. But if you believe in the future of nuclear energy and want to take a concentrated position in uranium-related businesses, the Global X Uranium ETF could be worth a look.

VanEck Uranium and Nuclear ETF (NLR): 28 stocks, five years of 19.99% annualized returns

The VanEck Uranium and Nuclear ETF (NYSEMKT: NLR) is another fund that offers investors the ability to buy into the uranium trade. This fund is a bit more concentrated than the Global X fund, with only 28 stocks in its portfolio. But the VanEck fund, in a way, is more broadly diversified, because it holds stocks of nuclear power producers (such as utilities) and nuclear facility service providers.

The VanEck Uranium and Nuclear ETF's top stock holdings as I write this include:

• Constellation Energy: 9.15% of the fund
• Cameco: 7.8%
• Public Service Enterprise Group: 7.5%
• BWX Technologies: 6.4%
• Fortum Oyj: 5.99%

The long-term returns for this VanEck ETF have been lackluster. Since the fund's inception in August 2007, it's delivered annualized returns (by net asset value) of 3.16%. The past few years have been better, with average annual returns (by NAV) of 19.99% for the past five years, 28.09% for the past three years, and 7.37% in the past year.

This fund has had a difficult 2026. Its year-to-date return is negative: -6.27% by net asset value. Will this underperformance continue, or can this fund bounce back? Time will tell. If you believe in the nuclear energy opportunity and want to own a mix of utilities, uranium miners, and other companies involved with the nuclear industry, this fund could be worth a look. And its expense ratio is a bit lower than URA's at 0.52%.

The latest deal is not the whole picture

Both of these exchange-traded funds offer investors a chance to profit from future gains in demand for uranium and nuclear energy. According to the World Nuclear Association, there are 440 nuclear power plants in operation around the world, with 80 new nuclear reactors under construction, 119 planned, and 327 proposed. If all those nuclear plants get built, that would be a huge boost to the number of nuclear reactors worldwide.

Trump's Saudi Arabia nuclear deal is one small piece of this larger picture. But the world needs energy, and many countries want low-carbon-emissions power that comes from nuclear energy. If you want to invest in the future of uranium mining and nuclear power, and you're willing to accept the risks and volatility, the VanEck Uranium and Nuclear ETF and the Global X Uranium ETF could be worth considering for long-term investors.

Ben Gran has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends BWX Technologies, Cameco, and Constellation Energy. The Motley Fool has a disclosure policy.