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Cannabis stocks, which were struggling on likely high tax rates in the United States, supply issues and financing concerns, have suddenly caught investors’ attention and are shining ahead of elections (read: Trump vs. Biden: ETF Strategies for the Election Outcome).
This is primarily owing to the optimism that more states may legalize going forward. With the election just a day away, five states are seeking to legalize marijuana through ballot measures. New Jersey, Arizona, South Dakota and Montana are set to vote on legalizing recreational cannabis for all adults over the age of 21. South Dakota also has a medical-cannabis measure on the ballot. Mississippi voters will weigh in on a medical-marijuana program.
As of now, 33 states have legalized medical cannabis including 11 states, which have legalized cannabis for adult recreational use. Notably, Vermont became the latest state to legalize recreational marijuana.
Additionally, the industry has gained momentum on Democratic vice president nominee Kamala Harris’ promise that a potential Biden administration would decriminalize marijuana. Further, the pot stocks were boosted by rapidly rising sales. According to market forecasts published by BDSA (formerly BDS Analytics), global cannabis sales for 2020 will likely grow 38% year over year to reach $19.7 billion (read: Cannabis ETFs Surge on Kamala Harris' Decriminalizing Marijuana Pledge).
As such, marijuana ETFs have been shining over the past month. Below we have highlighted them:
This is the newly entrant in the marijuana space, having accumulated $32.7 million in just two months. It is the first and only actively managed ETF with dedicated cannabis exposure focusing exclusively on U.S. companies, including multi-state operators. The product holds 32 securities in its basket and charges 74 bps in annual fees. The fund trades in an average daily volume of 69,000 shares and gained 14.6% in October.
With AUM of $5.9 million, CNBS is an actively managed portfolio which invests in 80% of its assets in securities of companies with 50% or more of their revenues from the cannabis and hemp ecosystem. The fund holds 23 securities and charges 75 bps in annual fees. It trades in an average daily volume of 6,000 shares and rose 7% last month.
The Cannabis ETF
This ETF offers investors exposure to a basket of stocks that are expected to benefit from the burgeoning hemp and legal marijuana industries. Holding 28 stocks in the basket, Canadian firms make up for 63.6% share while United States takes around 30.1% of assets. The fund has amassed about $22.1 million in AUM and trades in a good volume of about 39,000 shares per day, on average. It charges 70 bps in annual fees and was up 6.9% last month (read: 5 Sector ETFs Gaining in Double Digits to Start October).
YOLO is the actively managed ETF with a dedicated cannabis investment mandate domiciled in the United States. It seeks long-term capital appreciation by investing in both domestic and foreign cannabis equity securities. The fund holds a basket of 38 stocks with Canadian firms making up for half of the portfolio, followed by 33.8% share in the United States. It has gathered $61.7 million in its asset base and charges 74 bps in annual fees. The product trades in an average daily volume of 76,000 shares and has added 6.6% in the same time frame.
Global X Cannabis ETF
This ETF seeks to invest in companies across the cannabis industry and tracks the Cannabis Index. It holds 23 stocks in its basket with Canadian firms accounting for 82.3% of assets while United States takes 7.5% share. The product has accumulated $14.9 million in its asset base and trades in an average daily volume of 21,000 shares. Expense ratio comes in at 0.50%. POTX surged 6.3% last month.
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Cannabis ETFs Hot Ahead of Elections: Here's Why?
Cannabis stocks, which were struggling on likely high tax rates in the United States, supply issues and financing concerns, have suddenly caught investors’ attention and are shining ahead of elections (read: Trump vs. Biden: ETF Strategies for the Election Outcome).
This is primarily owing to the optimism that more states may legalize going forward. With the election just a day away, five states are seeking to legalize marijuana through ballot measures. New Jersey, Arizona, South Dakota and Montana are set to vote on legalizing recreational cannabis for all adults over the age of 21. South Dakota also has a medical-cannabis measure on the ballot. Mississippi voters will weigh in on a medical-marijuana program.
As of now, 33 states have legalized medical cannabis including 11 states, which have legalized cannabis for adult recreational use. Notably, Vermont became the latest state to legalize recreational marijuana.
Additionally, the industry has gained momentum on Democratic vice president nominee Kamala Harris’ promise that a potential Biden administration would decriminalize marijuana. Further, the pot stocks were boosted by rapidly rising sales. According to market forecasts published by BDSA (formerly BDS Analytics), global cannabis sales for 2020 will likely grow 38% year over year to reach $19.7 billion (read: Cannabis ETFs Surge on Kamala Harris' Decriminalizing Marijuana Pledge).
As such, marijuana ETFs have been shining over the past month. Below we have highlighted them:
AdvisorShares Pure US Cannabis ETF (MSOS - Free Report)
This is the newly entrant in the marijuana space, having accumulated $32.7 million in just two months. It is the first and only actively managed ETF with dedicated cannabis exposure focusing exclusively on U.S. companies, including multi-state operators. The product holds 32 securities in its basket and charges 74 bps in annual fees. The fund trades in an average daily volume of 69,000 shares and gained 14.6% in October.
Amplify Seymour Cannabis ETF (CNBS - Free Report)
With AUM of $5.9 million, CNBS is an actively managed portfolio which invests in 80% of its assets in securities of companies with 50% or more of their revenues from the cannabis and hemp ecosystem. The fund holds 23 securities and charges 75 bps in annual fees. It trades in an average daily volume of 6,000 shares and rose 7% last month.
The Cannabis ETF
This ETF offers investors exposure to a basket of stocks that are expected to benefit from the burgeoning hemp and legal marijuana industries. Holding 28 stocks in the basket, Canadian firms make up for 63.6% share while United States takes around 30.1% of assets. The fund has amassed about $22.1 million in AUM and trades in a good volume of about 39,000 shares per day, on average. It charges 70 bps in annual fees and was up 6.9% last month (read: 5 Sector ETFs Gaining in Double Digits to Start October).
AdvisorShares Pure Cannabis ETF (YOLO - Free Report)
YOLO is the actively managed ETF with a dedicated cannabis investment mandate domiciled in the United States. It seeks long-term capital appreciation by investing in both domestic and foreign cannabis equity securities. The fund holds a basket of 38 stocks with Canadian firms making up for half of the portfolio, followed by 33.8% share in the United States. It has gathered $61.7 million in its asset base and charges 74 bps in annual fees. The product trades in an average daily volume of 76,000 shares and has added 6.6% in the same time frame.
Global X Cannabis ETF
This ETF seeks to invest in companies across the cannabis industry and tracks the Cannabis Index. It holds 23 stocks in its basket with Canadian firms accounting for 82.3% of assets while United States takes 7.5% share. The product has accumulated $14.9 million in its asset base and trades in an average daily volume of 21,000 shares. Expense ratio comes in at 0.50%. POTX surged 6.3% last month.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>