The ETFMG Alternative Harvest ETF was the first cannabis-focused ETF to hit the marketplace back in late 2017 when it was converted over from a Latin American real estate fund.
Like most ETFs in this space, it focuses on the global cannabis market, which primarily consists of the United States, Canada and the United Kingdom.
The results of a number of state election initiatives over the past few years have demonstrated that Americans continue to get on board with cannabis and a federal legislation package that approves marijuana use at either the medical or recreational level could unlock a lot of the U.S.
Going forward, I still like MSOS to outperform in this space, but there’s another ETF recently launched that looks to take advantage of the same market.
It casts a pretty wide net allowing the inclusion of companies that have little direct exposure to the cannabis industry or whose presence is only a minor part of their overall business.
MJUS’s 0.75% expense ratio is identical to that of MJ, but at just $7 million in total assets so far, it’s probably still a little too early for it to be investable.
Given that there are now two U.S.-focused cannabis ETFs available to investors, which one should investors choose? MSOS has been around a comparatively longer 9 months and has amassed a much larger $900 million asset base, so from a pure liquidity and investability standpoint, MSOS easily comes out ahead.
companies, but because it focuses on more active growth plays than just investing in the biggest companies, such as Tilray .
While there are modest differences between the two ETFs, it’s probably safe to assume that they will remain highly correlated to each other and performance is likely to be fairly similar based on the current iterations of these portfolios of course.
Trading spreads on MJUS are more than twice that of MSOS right now, which makes it noticeably more costly to trade.