- Marijuana ETFs are stocks of companies that are engaged in the cannabis industry.
- The industry is pinning its hopes on the growing popularity of cannabis products and favourable legislation.
- Several US states have legalized the cannabis trade, although the federal government is yet to give a final nod on a cross-border trade.
Marijuana Exchange-Traded Funds (ETFs) are equities of companies engaged in the cultivation, distribution, and sale of cannabis products. They produce dry marijuana flowers, seeds, oil, and edibles. They are becoming increasingly popular both for medicinal and recreational purposes.
The federal government has not legalized marijuana yet. But half the states in the US have legalized it for medical purposes, while eight have legalized it for both medical and recreational purposes. In a step forward, the US House of Representatives has recently approved a bill to legalize marijuana.
The legal cannabis industry in the US has registered its fastest growth over the past year, with more than 243,700 jobs created at an annual growth rate of 15%.
AdvisorShares Pure Cannabis ETF (YOLO)
AdvisorShares Pure Cannabis ETF invests in securities companies that achieve at least 50% of their net revenue through cannabis and hemp businesses. These are the first ETFs in the US with a sole focus on cannabis. It invests in both domestic and foreign equities of marijuana. It majorly invests in mid-cap companies in the US, Canada, and also the UK. In addition, its holdings are in companies that are into agriculture, biotechnology, pharmaceutical, among others. Since its inception in 2019, the fund has gathered assets of US$465 million by February 2021.
Its stock traded at US$21.17 at 9.36 am ET on July 1, up by 0.38 percent over the previous closing price. Its stock price increased by 19.67 percent YTD and 103.75 percent YoY. Its weighted Alpha value is 75.53, and beta is 1.68. Its standard deviation is -0.19. The expense ratio is 0.75%. Its 52-week highest stock price is US$31.87, and the lowest is US$10.05.
AdvisorShares Pure US Cannabis ETF (MSOS)
AdvisorShares Pure US Cannabis ETF fund solely invests in American cannabis companies, including multistate operators (MSOs). MSOs are cannabis companies involved in the legal production and distribution of marijuana in states where it's approved. MSOs' portfolio includes cannabis firms and REITs. MSOs were launched with US$25 million in assets in September 2020, and by February 2021, the assets grew to US$1 billion.
Its stock traded at US$40.45 at 10.14 am ET on July 1, down by 1.10 percent over the previous closing price. Its stock prices increased by 2.10 percent YTD and 64.04 percent YoY. Its weighted Alpha value is 55.95 and beta is -2.38. It recorded standard deviation is -0.38. It's 52 weeks highest stock price is US$55.91 and the lowest is US$20.45.
ETFMG Alternative Harvest ETF (NYSE Arca: MJ)
ETFMG Alternative Harvest ETF is the world’s largest cannabis ETF, focusing on the world’s cannabis industry. It gives its investors exposure to the cannabis industry, witnessing advancements and regulatory changes.
Within three years of inception, MJ joined the club of companies having US$1 billion in assets in December 2020. MJ has currently 50 million shares outstanding. In 2020, it gave a cumulative US$24 million in quarterly dividends payout to its investors. In addition, the fund proactively educates investors about the global cannabis ecosystem.
Its stock traded at US$20.52 at 10.55 is ET on July 1, down by 0.29 percent over the previous closing price. Its stock prices increased by 38.08 percent YTD and 58.08 percent YoY. Its 52-week highest stock price is US$34.58, and the lowest is US$10.12. The share volume is 82,555.
Spinnaker ETF Series The Cannabis ETF (NYSE Arca: THCX)
THCX tracks the Innovation Labs Cannabis Index. The index has 33 stocks, which has been growing due to the growth of the cannabis industry. The company paid a quarterly dividend of US$0.87 in four quarters of 2020.
Its stock traded at US$17.1518 at 11.11 is ET on July 1, down by 0.01 percent over the previous closing price. Its stock prices increased by 31.73 percent YTD and 78.10 percent YoY. Its 52-week high is US$30.99, and the lowest is US$8.01. The share volume is 9937. Weighted Alpha is 47.58, and Beta is 1.77. The standard deviation is -0.04. The expense ratio is 0.70%. Asset under management is 151,689.
Amplify Seymour Cannabis ETF (CNBS)
Amplify Seymour Cannabis ETF invests in global companies engaged in the emerging marijuana and hemp ecosystem. It has three types of companies- cannabis/hemp plant, support cultivation, retail, and ancillary companies that supply services and products to the broader cannabis market. Some 80% of its portfolio companies earned over 50% of their revenue from the cannabis and hemp ecosystem. It was launched in July 2019.
Its stock traded at US$25.535 at 11.15 am ET on July 1, down by 0.99 percent over the previous closing price. Its stock prices increased by 41.23 percent YTD and 128.49 percent YoY. Its 52-week high is US$40.65, and the lowest is US$10.97. The share volume is 15,926. Weighted Alpha is 98.58, and Beta is 1.63. The standard deviation is -0.36. The expense ratio is 0.75%. Asset under management is 148,178.
MicroSectors Cannabis 2X Leveraged ETNs (MJO)
Its stock traded at US$103.5637 at the premarket ET on July 1, down by 0.97 percent over the previous closing price. Its stock prices increased by 27.44 percent YTD and 142.51 percent YoY. Its weighted Alpha value is 83.40, and beta is 2. Its recorded standard deviation is -0.38. Its 52-week high is US$209.04, and the lowest is US$42.70.
Please note: The above constitutes a preliminary view, and any interest in stocks/cryptocurrencies should be evaluated further from an investment point of view.