AdvisorShares rolled out an actively managed psychedelics ETF today. The AdvisorShares Psychedelics ETF (PSIL) will invest in companies that legally derive at least half of their revenue or assets from psychedelic drugs.
The fund comes with an expense ratio of 0.68% and lists on the NYSE Arca.
A press release from AdvisorShares notes that there’s a growing body of research indicating psychedelics are effective in treating a variety of mental health issues and neurological disorders
“We feel that our active management and specialized approach can potentially help investors capture the early growth potential of psychedelics and its prominent promise on therapeutics and medical fields,” said AdvisorShares Chief Operating Officer Dan Ahrens.
Ahrens manages a number of AdvisorShares ETFs, including the $760 million AdvisorShares Pure US Cannabis ETF (MSOS), the $261 million AdvisorShares Pure Cannabis ETF (YOLO) and the $12.5 million AdvisorShares Vice ETF (VICE).
PSIL will target companies with dominant market positions or with the potential for strong growth, but could also invest in stocks that its managers consider to be overlooked. The fund also has the ability to invest in derivatives that have similar characteristics to the life sciences securities in the portfolio, according to the prospectus.
PSIL’s top holdings include Cybin (10.36%), Field Trip Health (8.32%) and Mind Medicine (8.08%).
However, AdvisorShares is not the first player in this space. In late May, Defiance rolled out the Defiance Next Gen Altered Experience ETF (PSY), which is index-based and charges an expense ratio of 0.75%, seven basis points more than PSIL.
Contact Heather Bell at [email protected]