Top Marijuana ETF Adds 10 Stocks, Eyes US CBD Market

As part of a quarterly update, the biggest publicly traded exchange-traded fund (ETF) for the cannabis space added 10 new cannabis stocks.

The Horizons Marijuana Life Sciences Index ETF (TSX:HMMJ) completed its quarterly rebalance and updated investors on its new holdings on Tuesday (March 19).

With these new additions, Horizons ETFs Management confirmed the ETF now has 59 cannabis stocks in its holding list.

Horizons ETFs indicated that, as of March 15, the ETF had netted a return of 58.95 percent over a year-to-date period.

Here is a list of the stocks added to HMMJ’s portfolio:

• 48North Cannabis (TSXV:NRTH)
• AgraFlora Organics International (CSE:AGRA,OTC Pink:PUFXF)
• Cannara Biotech (CSE:LOVE)
• Charlotte’s Web Holdings (CSE:CWEB,OTCQX:CWBHF)
• The Flowr Corporation (TSXV:FLWR,OTC Pink:FLWPF)
• Heritage Cannabis Holdings (CSE:CANN,OTC Pink:HERTF)
• ICC International Cannabis (CSE:WRLD.U,OTC Pink:WLDCF)
• PharmaCielo (TSXV:PCLO)
• Westleaf (TSXV:WL,OTCQB:WSLFF)
• Zenabis Global (TSXV:ZENA)

ETF management team sees potential in rising US CBD market

Horizons ETFs highlighted a new sector of the overall market it will be exploring moving forward: hemp-derived cannabidiol (CBD).

“According to a study by the Brightfield Group, the US legal CBD industry alone could be worth US$22 billion within the next two years, which puts that single market by itself at roughly the same target market size of the entire Canadian Marijuana industry,” Steve Hawkins, president and CEO of Horizons ETFs, said in a press release.

The ETF managers pointed to the addition of Charlotte’s Web as its intent to capitalize on this booming CBD space.

This Colorado-based company holds a market capitalization of just over C$368 million. Shares of the firm have increased in value over a year-to-date period by 44.82 percent to reach a price of C$21.71.

As part of its previous rebalancing in December 2018, Horizons ETFs included Khiron Life Sciences (TSXV:KHRN,OTCQB:KHRNF), MediPharm Labs (TSXV:LABS,OTCQB:MLCPF) and Auxly Cannabis Group (TSXV:XLY,OTCQX:CBWTF) to the mix.

In September 2018, HMMJ crossed the C$1-billion mark for assets managed in its holdings.

The space for ETFs focused on the cannabis market has grown with the addition of other funds attracting investors. HMMJ remains as a passively managed index designed to offer investors a basket of North American companies with significant interests in the marijuana space.

Other cannabis-centric ETFs have differentiated by offering active management, appointing a portfolio manager and making sure to actively add or drop stock in a company depending on the evolution of the market.

Following the success of HMMJ, Horizons ETFs launched an additional publicly traded ETF to focus on smaller ventures in the marijuana market.

The Horizons Emerging Marijuana Growers Index ETF (NEO:HMJR) made its debut in February 2018.

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Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: Cannara Biotech, The Flowr Corporation, Heritage Cannabis Holdings, Khiron Life Sciences and MediPharm Labs are clients of the Investing News Network. This article is not paid-for content.