Canadian Marijuana ETF in Shares Up 124% Since April
The 1st marijuana ETF (exchange-traded fund) has reached a milestone that has as much to do with surging marijuana stocks as it does with investor inflows.
The Horizons Marijuana Life Sciences Index ETF’s (HMMJ) total assets have grown to more than C$1-B (US$783-M)as shares rallied 124% since its April 2017 debut on the Toronto Stock Exchange.
It is the 1st cannabis-focused fund to break the billion-dollar mark. HMMJ has benefited from growing investor demand for marijuana stocks.
“HMMJ’s growth has far exceeded our expectations as investors have strongly supported the sector in anticipation of Canada’s upcoming recreational marijuana legalization,” Horizons’ CEO said in a statement.
Canada will legalize recreational use on 17 October.
Investors in the US have been buying shares of the $436-M ETMG Alternative Harvest ETF (MJ). MJ took in more than $30-M August, its largest monthly inflow since January.
Marijuana stocks have been running since mid-August, when Corona beer maker Constellation Brands Inc. (NYSE: STZ) invested C$5 billion in Canopy Growth Corp.(NYSE:CGC), a signal that mainstream companies are beginning to see the potential in cannabis and its benefits in consumer products.
Canopy, the 2nd-largest holding in HMMJ, has seen its stock price more than double since the deal was announced. HMMJ has gained 54% over the same frame.
HMMJ invests in life sciences companies with significant activities in the marijuana industry. Its holdings include major cannabis producers, as well as ancillary businesses like Scotts Miracle-Gro Co.(NYSE:SMG) the fertilizer producer.
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