Weekly Model Nuclear Fund Update Report
2/1/26
SEQH Capital Research
Model Nuclear & Uranium Fund: Forecast and Scenario Analysis
February 1, 2026
Model Nuclear & Uranium Fund – Strong Buy Reiterated After Healthy Correction
SEQH Capital Research reiterates its strong buy recommendation on the Model Nuclear & Uranium Fund following a healthy 8.49% week‑over‑week pullback that we view as a tactical buying opportunity rather than a thesis‑breaking event. The fund’s long-term narrative remains intact: a structural uranium supply deficit, accelerating demand from global reactor growth and AI‑driven data center loads, and durable government policy support continue to underpin a multi‑year bull market in nuclear and uranium.
As of February 1, 2026, the fund’s total portfolio value stands at $122,757.61 with a total return of +22.76% since inception, supported by substantial alpha versus SPY and strong performance from core holdings such as NUAI (+131.0%) and UUUU (+51.8%). While short‑term risk‑adjusted metrics have moderated (Sharpe 0.459, Sortino 1.223) and maximum drawdown has reached ‑21.60%, we interpret this volatility as characteristic of an emerging bull market and as a source of opportunity for long‑term investors rather than a warning signal.
Our updated quantitative framework, recalibrated to the lower starting valuation, now projects markedly higher forward return potential: the Base Case forecasts a +78.8% return over the next 12 months to an expected fund value of $219,507, while the Bull Case points to +153.8% upside and a potential value of $311,578. Scenario work anchored to a 10,000‑iteration Monte Carlo simulation, combined with our uranium price forecasts (Base Case $92/lb, Bull Case $120/lb within 12–24 months), shows an 88.1% probability of a positive 12‑month return and a 58.3% probability of returns exceeding 50%, underscoring a strongly positively skewed payoff profile.
From a sector standpoint, we continue to see a profound and persistent undersupply in uranium, reinforced by a roughly 50% utility contracting deficit from 2025 and a global pipeline of 70 reactors totaling 78 GWe that is set to drive sustained fuel demand. Policy support remains a powerful tailwind, with more than $80 billion in U.S. nuclear‑related commitments, production restrictions, and a 44% decline in U.S. production adding near‑term bullish pressure while long‑cycle investment flows point to a durable imbalance in supply and demand.
Risk remains inherent and meaningful: the fund exhibits elevated annualized volatility of 40.87%, a non‑trivial historical drawdown, and meaningful exposure to sector‑specific, regulatory, and sentiment shocks. However, our updated risk analysis indicates that the lower entry point improves the forecast risk‑adjusted profile, with a Base Case projected Sharpe Ratio of 1.601 and a 95% 12‑month VaR capped at a loss of 16.39%, while structural features of nuclear fuel demand provide a hard floor that mitigates extreme downside scenarios. In our view, the confluence of a structural supply crisis, AI‑driven incremental demand, and robust policy support now creates an exceptionally attractive asymmetric setup, and we advise clients to use current weakness to build or add to positions in advance of the next leg higher in the cycle.
Paid Member Section – Full PDF Contents Include:
Updated portfolio metrics and performance dashboard (total return, volatility, Sharpe, Sortino, alpha, drawdown) with week‑over‑week context.
Detailed uranium market thesis: supply‑demand imbalance, utility contracting gap, reactor and GWe pipeline, U.S. policy support and production trends.
Uranium price target framework: 12–24 month Base and Bull Case price paths and drivers.
Advanced scenario and Monte Carlo analysis, including 12‑month return distributions and probability bands.
Updated risk analytics: VaR, forecast Sharpe, and qualitative risk mitigation discussion.
Full charts, tables, and visual exhibits supporting the fund‑level forecasts and sector outlook.
[Full Scenario Analysis Report PDF Attached Below]
