A considerable number of investors are steadfastly focused on cannabis stocks, giving no consideration to cannabis ETFs, mutual funds and other investment options. Diversification is the name of the game when it comes to investing. There is no sense investing your hard-earned money in a couple cannabis stocks when a rogue accountant has the potential to send his company’s stock price cratering. Instead, the better approach is to invest in cannabis ETFs that diversify risk across a considerable number of cannabis industry stocks. Let’s take a look at some of the most attractive cannabis ETFs.
The Cannabis ETF (THCX)
If you are looking for a cannabis ETF that will help you benefit from the entire cannabis industry, this ETF is worth consideration. THCX launched one year ago and now has around $20 million in assets. The majority of THCX holdings are in the United States though there is some exposure to the Canadian and British markets. It is particularly interesting to note the bulk of this fund’s holdings are in the biotech and pharmaceuticals industries. Examples of stocks in the THCX ETF include Scotts Miracle-Gro, Aurora Cannabis and GW Pharmaceuticals.
Alternative Harvest ETF (MJ)
MJ hit the market nearly three years ago. This is the largest cannabis ETF traded with nearly $800 million in assets. MJ is primarily centered on the Prime Alternative Harvest Index, a benchmark that tracks the worldwide cannabis industry in addition to businesses poised to benefit from the rising interest in cannabis investing. MJ consists of cannabis distributors, producers and growers. The ETF also includes cannabinoid drug manufacturers with a few tobacco businesses and fertilizer makers sprinkled in. The top holdings in MJ are Cronos Group, Tilray and Canopy Growth.
Cambria Cannabis ETF (TOKE)
TOKE started up last summer, yet it is one of the smaller cannabis ETFs on the market. All in all, TOKE has around $10 million in assets. TOKE is invested in cannabis companies of all sizes. This ETF is primarily focused on businesses that pull the bulk of their revenue from the production, cultivation and sale of cannabis-related items, research and services. TOKE’s holdings are spread out across four nations. About two-thirds of the ETF’s holdings are in Canadian cannabis businesses. One-quarter of TOKE holdings are in cannabis companies in the United States. The rest of TOKE’s holdings are in British and Australian cannabis companies.
AdvisorShares Pure Cannabis ETF (YOLO)
This actively managed ETF zeroes in on cannabis businesses in industries related to the plant. Examples include retail, real estate, finance, pharmaceutical and biotech. YOLO has in excess of $40 million assets. YOLO’s primary holdings are Innovative Industrial Properties, OrganicGram Holdings Trulieve Cannabis and Village Farms.
Global X Cannabis ETF (POTX)
The majority of this cannabis ETF’s holdings are in Canadian cannabis businesses. In particular, POTX is focused on medicinal cannabis companies. POTX top holdings include Aurora Cannabis, Aphria, Canopy Growth, Tilray and HEXO Corp.