AdvisorShares launched an ETF on Wednesday that offers 200% of the daily total return of the nearly $650 million AdvisorShares Pure US Cannabis ETF (MSOS), the largest U.S.-listed ETF tracking the marijuana industry. The new fund, the AdvisorShares MSOS 2x Daily ETF (MSOX) is actively managed, like its reference ETF.
MSOX comes with an expense ratio of 0.95% and lists on the NYSE Arca.
MSOS launched in September 2020 and covers the U.S. cannabis industry specifically, including companies known as multistate operators in its portfolio via swaps or direct ownership through stocks. The current portfolio includes direct ownership in about 10 stocks, with the rest comprising derivatives exposure and fixed income securities.
MSOS overtook the ETFMG Alternative Harvest ETF (MJ) as the largest cannabis ETF late last year. MJ was the first ETF to cover the marijuana space. It’s currently a $411 million fund. In July 2021, MJ’s issuer launched the ETFMG 2x Daily Alternative Harvest ETF (MJXL), which offers 2x leveraged exposure to MJ. However, more than a year later, the fund has less than $1 million in assets under management.
That could be because the marijuana space hit a high in February 2021 and has been on a downward trajectory ever since. However, with legalization continuing to gain support and legislation being voted on by the residents of several states this November, that trend may begin to shift. MSOX’s launch could very well give it an advantageous entry point to a marijuana industry that has hit a bottom.
Contact Heather Bell at [email protected]