Saturday , 8 August 2020

Cannabis Central: September Ranking Of All 12 Marijuana ETFs

By Lorimer Wilson, editor of – Your KEY to making money!

In a recent article I suggested that cannabis or cannabis-related ETFs were the best way to invest in the burgeoning marijuana sector but, that being said, not all such ETFs perform equally well given their constituents. Below is the performance of each in September ranked from best (-1.5%) to the worst (-23.5%).

1. Advisor Shares VICE ETF (Nasdaq:ACT) -1.5%

ACT believes that investing in select alcohol and tobacco companies and restaurant/entertainment businesses will provide continued growth and long-term performance across all types of market environments and that the 51.6% of cannabis-related companies in the ETF will provide considerable upside potential to complement the historically resilient characteristics of alcohol and tobacco.

The ETF:

  • is actively managed,
  • has an expense ratio of 0.75%,
  • a very respectable beta of 0.76
  • and is broadly diversified with its 30 constituents (see constituents here) allocated as follows:
    • Cannabis related: 30.3%
    • Alcohol: 24.0%
    • Restaurant & Entertainment: 16.1%
    • Tobacco with cannabis exposure: 13.7%
    • Alcohol with cannabis exposure: 7.6%
    • Tobacco: 8.2%

ACT was the best performing marijuana/marijuana-related ETF during the month of September, declining “only” 1.5% (versus -3.5% in August). 

Below is the September performance of the remaining 11 marijuana ETFs in descending order:

  1. Cambria Marijuana Industry Fund ETF (CBOE:TOKE) -12.5% (active mgmt)
  2. Amplify Seymour CNBS Cannabis ETF (NYSE:CNBS) -12.6% (active management)
  3. Innovation Shares The Cannabis ETF (NYSE:THCX) -14.7% (passive mgmt)
  4. Evolve Marijuana Fund ETF (TSX:SEED) -15.2% (active mgmt)
  5. Evolve U.S. Marijuana ETF (NEO:USMJ) -15.4% (active mgmt)
  6. Purpose Marijuana Opportunities ETF (NEO:MJJ) -15.5% (active mgmt)
  7. Horizons Marijuana Life Sciences ETF (TSX:HMMJ) -15.8% (passive mgmt)
  8. Advisor Shares Pure Cannabis ETF (NYSE:YOLO) -17.1% (active mgmt)
  9. Horizons Emerging Marijuana Growers ETF (NEO:HMJR) -17.5% (passive mgmt) 
  10. ETFMG Alternative Harvest ETF (NYSE:MJ) -18.4% (passive mgmt)
  11. Horizons US Marijuana Index ETF (NEO:HMUS) -23.5% (passive mgmt)

For the record, below is how the 2 actively managed leveraged marijuana ETFs fared in September:

  • Horizons Beta Pro Marijuana 2X Daily Bull ETF (TSX:HMJU) -29.5%
  • Horizons Beta Pro Marijuana Inverse ETF (TSX:HMJI) +12.0%

In summary, the average marijuana/marijuana-related ETF (excluding the 2 leveraged ETFs mentioned above) was down 14.6% in September and, while the average performance was down all but one of those ETFs outperformed the industry as a whole which was down 18.6%.