The push for the legalization of cannabis is not going away, and investors can capture this growing industry through targeted exchange traded funds.
“A year ago, it was the bull trade everybody wanted a piece of and it was just thematic. The good news is that 12 months later, that macro story, that addressable market, that CPG consumer product story is alive and well,” Tim Seymour, CIO, Seymour Asset Management, said at the Inside ETFs conference.
While the Federal level push for legalization has slowed down a little bit, Seymour pointed out that the story is still alive among U.S. states that are individually relaxing laws and driving the legalization of cannabis.
ETF investors can gain exposure to the rising cannabis business through targeted ETF strategies, such as the Amplify Seymour Cannabis ETF (NYSEArca: CNBS).
The actively managed CNBS utilizes a top down and bottom up analysis performed by early-stage cannabis investor Tim Seymour. The fund’s analysis will be used to determine the holdings and weightings of the diverse portfolio of cannabis stocks held by the ETF. It will not invest in any company that is deemed to be violating any federal or state laws.
The new cannabis ETF has a purity mandate which requires 80% of the ETF’s assets to be invested in companies with 50% or more of their revenue from the hemp and cannabis ecosystem as well. The portfolio includes exposure to cannabis hemp plant through pharma, biotech, cultivation and retail, hemp products, and cannabis-infused products; support through agricultural technology, real estate and commercial services; and ancillary exposure through consumption devices, investing and finance, and technology and media.
Seymour has over 20 years of general investment experience and has been an early stage investor and recognized voice in the cannabis industry. He serves as a board member or in an advisory role for several private cannabis companies and provides regular commentary as a host on CNBC’s show Fast Money.
For more ETF-related commentary from Tom Lydon and other industry experts, visit our video category.
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