Investors May Want to Invest in Cannabis Immediately

Aug 31, 2023

Cannabis may be one of the most controversial investment opportunities.

But it may also be one of the most profitable.

Over the last few days, the Department of Health and Human Services moved to reclassify marijuana as less harmful than cocaine or heroin, a possible first step toward wider legalization, as noted by USA Today.

In fact, “a Health and Human Services Department official wrote to Drug Enforcement Administration Administrator Anne Milgram that marijuana should be classified as a schedule three substance, which consists of drugs “with a moderate to low potential for physical and psychological dependence.”

Further progress could ignite a massive rally in cannabis stocks, and ETFs, including:

ETFMG Alternative Harvest ETF (MJ)

With an expense ratio of 0.75%, the MJ ETF tracks the Prime Alternative Harvest Index, designed to measure the performance of companies within the cannabis ecosystem benefitting from global medicinal and recreational cannabis legalization initiatives. Some of its top holdings include Canopy Growth, Cronos Group, Aurora Cannabis, and OrganiGram Holdings.

Global X Cannabis ETF (POTX)

With an expense ratio of 0.50%, the ETF seeks to invest in companies across the cannabis industry. This includes companies involved in the legal production, growth and distribution of cannabis and industrial hemp, as well as those involved in providing financial services to the cannabis industry, pharmaceutical applications of cannabis, cannabidiol (i.e., CBD), or other related uses. Some of its top holdings include Canopy Growth, HEXO Corp., and AFC Gamma.

Advisor Shares Pure US Cannabis (MSOS)

With an expense ratio of 0.73%, the ETF is the first actively managed U.S.-listed ETF with dedicated cannabis exposure focusing exclusively on U.S. companies, including multi-state operators. The portfolio manager allocates across an investable universe of U.S. companies spanning a variety of cannabis-related businesses. Some of its top holdings include Green Thumb Industries, Curaleaf Holdings, Cresco Labs, Jushi Holdings, and GrowGeneration Corp.

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