A small, retail investor looking to gain exposure to rare earth materials might consider MP Materials (MP) and Avalon Advanced Materials (AVL/AVLNF) or Ucore (UCU.t)
Here is how I am approaching the investment, with strategies tailored to risk profile, capital allocation, and market timing.
🧾 Step-by-Step Investment Approach
1. Understand Their Profiles
| Company | Ticker | Exchange | Stage | Region | Risk Level |
|---|---|---|---|---|---|
| MP Materials | MP | NYSE (USA) | Mature | USA | Low-to-Medium |
| Avalon Advanced Materials | AVL | TSX-V (Canada) / OTCQB (AVLNF) | Early-stage | Canada | High (speculative) |
2. Diversified Allocation Strategy (Example for $10,000 Portfolio)
| Risk Appetite | MP Materials | Avalon (AVL) | Cash / Other |
|---|---|---|---|
| Conservative | $7,000 (70%) | $1,000 (10%) | $2,000 (20%) |
| Balanced | $5,000 (50%) | $3,000 (30%) | $2,000 (20%) |
| Aggressive | $3,500 (35%) | $5,000 (50%) | $1,500 (15%) |
Why?
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MP Materials gives you stability, cash flows, and policy tailwinds.
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AVL offers asymmetric upside if Canada builds its rare earth value chain and AVL scales successfully.
3. Entry Strategy
✅ MP Materials (MP):
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Buy in tranches on pullbacks or near $16–$18 (historical support levels).
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Consider:
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Dollar-cost averaging (DCA) monthly.
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DRIP (Dividend Reinvestment Plan) if/when dividends resume (none currently).
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Long-term hold (5+ years), especially as magnet plant comes online in Texas (2025–2026).
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✅ Avalon (AVL / AVLNF):
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Higher volatility—treat as venture capital–style bet.
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Entry near lows (e.g., <$0.20 CAD) may offer multi-bagger potential if milestones hit.
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Buy small initial position; increase only after:
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Major partner/funding announcement.
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Processing milestones with Saskatchewan Research Council.
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Government contracts or grant programs.
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4. Monitor These Catalysts
| MP Materials | Avalon / Nechalacho |
|---|---|
| U.S. DoD magnet plant progress | Financing or JV for full-scale processing |
| Q4/Q1 financials (growth + margins) | Offtake agreements for heavy REEs |
| EV/OEM contracts (GM, Tesla, etc.) | Indigenous partnerships & ESG momentum |
| REE price trends (Nd-Pr especially) | Federal critical mineral program funding (Canada) |
5. Alternative / Supplementary Exposure
If you want a broader REE basket, consider:
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ETFs (Note: very few pure-play REE ETFs exist):
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🟢 REMX – VanEck Rare Earth/Strategic Metals ETF
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MP is a top holding. AVL may be included in future if it grows.
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Includes Lynas (AUS), Iluka, China Northern Rare Earth, etc.
Ucore Rare Metals (constructing a heavy REE separation plant in Louisiana)
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Battery Metals ETFs – Broader exposure but with lithium/cobalt/nickel too.
🔚 Final Thoughts
| Recommendation | MP Materials | Avalon Advanced Materials |
|---|---|---|
| Buy if you want... | Stability + growth + U.S. policy exposure | High-risk, high-reward REE growth |
| Best time to enter | On dips below $20 | Sub-$0.25 CAD on good volume |
| Exit horizon | Hold through 2030 | Re-evaluate after 12–24 months |
Conclusion:
🔒 Use MP Materials as your anchor investment in rare earths—de-risked, policy-supported, with upside from magnet integration.
🔥 Use AVL as a speculative levered bet on Canada’s REE independence and heavy rare earth supply growth.
Ongoing Projects & Goals
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Avalon continues advancing its lithium strategy via its Separation Rapids lithium JV (with Sibelco), its Snowbank lithium deposit, and Lilypad lithium-caesium claims in Ontario.
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Concurrently, they’re progressing work on the Nechalacho rare earths & zirconium project in the Northwest Territories, which is important for tech and defense supply chains as it is North America's largest deposit of "Heavy" REE's or HREE's . The Northern Miner+6
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A key focus is the development of Ontario’s first mid‑stream lithium hydroxide processing plant, based in Thunder Bay, to create a supply link between northern lithium resources and battery producers in southern markets.
UCORE RARE METALS INC-NEW
Recent news:
"Ucore Launches US Department of Defense Funded $18.4 Million Commercial Rare Earth Refining Project in Louisiana"
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