The new AdvisorShares Pure Cannabis ETF, ticker YOLO, allows investors to invest in 'pure plays' in the cannabis space under an actively managed structure.
div > div.group > p:first-child"> Case in point: Last week saw the debut of a new marijuana-themed exchange-traded fund called the AdvisorShares Pure Cannabis ETF, an actively managed fund with nearly $2.5 million assets under management. Trading under the ticker YOLO, the ETF is backed by BNY Mellon and holds shares of Canadian growers like Aurora Cannabis and Canopy Growth.
"The previous fund here, MJ, had to kind of do a bit of an end-around" with its backers, ETF.com Managing Director Dave Nadig told CNBC's "ETF Edge" on Monday."They sort of turned a Latin American real estate fund into a marijuana fund. ... They had to go get Wedbush, a broker-dealer, to hold the assets. And that's fine, but the difference is it's not a bank.
"Because it's actively managed, obviously they need to know what's OK and what's not OK" to trade, he said."So they're working through their 'OK' list, and they've put together a portfolio which, when you look at it, looks like a pretty darn good pure-play cannabis ETF." "The new fund, YOLO, is really a pure play," he said."This is a case where active management may make sense. This is a fast-moving space. ... Being able to move around the edges of the industry, I think, is going to be really important for success."
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