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First medical marijuana-based ETF to be listed on TSX


Starting next week, investors will be able to try to capitalize on the success of the growing pot industry by putting their money into the world’s first medical marijuana ETF.

Launching on April 5 under Horizons ETFs Management, the Horizons Medical Marijuana Life Sciences ETF (trading under the symbol HMMJ) will offer investors exposure to a diverse group of companies that have links to the medical marijuana industry. This includes companies involved with biopharmaceuticals, fertilizer, soil, hydroponics and other related businesses.

It’s the first ETF of its kind to launch in a North American market, giving investors an opportunity to capitalize on the significant growth of the marijuana industry in recent years.

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“Here we are today, the medical marijuana industry has grown so significantly in the last two years, up like 400 per cent,” Steve Hawkins, president and co-CEO of Horizons ETFs, told CBC News.

“It’s expected to triple again this year, and double again the following year after that, so right now … it is very timely to be talking about marijuana and to be investing in marijuana.”

Until now, investors who wanted to share in the financial gains made by the medical marijuana have been limited in their stock options, with the primary candidate on the TSX being Canopy Growth Corp., the first company to be added to the S&P/TSX composite index.

ETFs, which have emerged as a lower-cost, diversified alternative to mutual funds in the last few years, are directed by indexes, rather than being actively managed by a fund manager. Horizons’ ETF will be based on the North American Medical Marijuana Index.

“We feel that the methodology of the North American Medical Marijuana Index will maximize the risk/reward opportunity for investors by ensuring the companies in the index meet important liquidity and asset requirements, so that the stocks in the index are the leaders in the medical marijuana industry,” Hawkins said in a press release.