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The New Cannabis ETF Is Already Making Additions

ETF Professor

The AdvisorShares Pure Cannabis ETF (NYSE: YOLO) debuted last week as just the second U.S. ETF dedicated to marijuana.

What Happened

Although Tuesday was just YOLO's third day on the market, the fund's portfolio manager Dan Ahrens already made some additions to YOLO's roster.

Greenlane Holdings Inc. (NASDAQ: GNLN), the Florida-based maker of cannabis vape hardware and related accessories, commenced an initial public offering on April 17, the day before YOLO debuted. That stock is now part of YOLO's lineup at a weight of almost 3 percent.

“We kept eyeballs on that [the Greenlane IPO], did not want to buy it as part of the IPO,” Ahrens said in a video posted on Twitter. “Yesterday [April 22], the stock dipped... We bought shares of Greelane Holdings."

Why It's Important

YOLO also added shares of Israeli biotechnology firm Intec Pharma Ltd. (NASDAQ: NTEC). With a market value of just over $207 million, NTEC now commands a weight of almost 2 percent in YOLO.

Arena Pharmaceuticals, Inc. (NASDAQ: ARNA), a California-based biotechnology company working on a cannabinoid receptor to treat abdominal pain and irritable bowl syndrome (IBS), was also added to YOLO's roster. Shares of Arena are YOLO's smallest holding at a weight of 1.92 percent.

In the Twitter video, Ahrens noted the Arena and Intec positions are small, but highlighted the fund being actively managed, meaning the managers can add, drop or adjust holdings as they see fit. YOLO's primary rival among the U.S.-listed cannabis ETFs, the ETFMG Alternative Harvest ETF (NYSE: MJ), is a passively managed index-based ETF.

What's Next

On Tuesday, Canada-based Aleafia Health Inc. (OTC: ALEAF), which calls itself “a vertically integrated cannabis health and wellness company,” said it was added to YOLO, too.

Aleafia has a 2.66-percent weight in the new marijuana ETF.

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