A BUSINESS TO EXPLORE: MARIJUANA DEBUTS WITH GOOD FOOT IN THE STOCK EXCHANGE


 

La gestora Horizons ETFs ha puesto en marcha el Horizons Medical Marijuana Life Science ETF, que se revaloriza un 5% en sus dos primeros días de cotización.

This year, a quoted marijuana fund (ETF) started trading. Horizons Medical Marijuana Life Sciences ETF has gone to operate on the Toronto Stock Exchange under the symbol HMMJ and has done so successfully: in the first two days it has revalued more than 5%. In this way, it has become the first ETF that offers exposure to actions involved with medical marijuana and its production.
This ETF replies, "to the extent possible," as it puts in its description, the performance of the North American Medical Marijuana index. This index is designed to provide exposure to the evolution of a basket of listed companies with significant economic activities in the cannabis industry.

According to the president of Horizons ETFs (the manager of this fund), Steve Hawkins, "HMMJ is a way for investors to access the marijuana industry with transparent control and diversification in companies." In addition, he assures that the medical marijuana industry "is growing rapidly in North America."

The index it replicates is designed to invest in equity securities of companies related to science and to the activity of marijuana that are in the stock market. Thus, this ETF can include biopharmaceutical products, medical manufacturing, distribution, bioproducts and other auxiliary companies to the marijuana industry.
According to the information of the quoted fund, only the securities that meet the minimum liquidity thresholds of the assets are eligible for inclusion in the Index. The shares in the index are readjusted quarterly on a market capitalization basis, and capped so that no single stock can exceed 10% of the Index's weight.

 

QUOTATION
HMMJ closed its initial offer after the close of operations of the Toronto Stock Exchange on April 4 and began trading on the following day (April 5). The starting price was 10 Canadian dollars and the first day closed with a rise of 2.5% so it stood at 10.25 dollars. A rise that has been extended, since the second day has raised another 2.5%. The Horizons Medical Marijuana Life Sciences ETF has a wealth of more than 10 million dollars.


However, this fund has a blip, since its price is in Canadian dollars and replicates an index quoted in US dollars. An obstacle that makes the ETF vulnerable to the exchange rate risk.


The North American Medical Marijuana Index, which tracks the leading US and Canadian cannabis companies, is comprised of 32 values, all of which are related to cannabis. The most important company is GW Pharmaceuticals Plc, since its market capitalization is 2.95 billion dollars and has a weight of 10% in the index. Other companies with a weight of 10% are Scotts Miracle-Gro Company, Canopy Growth Corporation, Insys Therapeutics, Aurora Cannabis and Aphria.

 

 

 

LEGALIZATION OF YOUR RECREATIONAL USE

The start-up of this quoted fund coincides with the legalization of the recreational use of marijuana in Canada. As of July 1, 2018, smoking marijuana will be legal in the country. Prime Minister Justin Trudeau will begin the process of legalizing the use of this drug for recreational uses the week of April 10.

In this way, the electoral promise of Trudeau, who has been in charge of the government for more than two years, would be fulfilled. If finally approved, Canada will be the largest developed country to end the ban on cannabis use for recreational use nationwide.

In the United States, voters in California, Massachusetts, Maine and Nevada approved their legalization last year, adding to Colorado, Washington, Oregon and Alaska. Uruguay, in South America, is the only country that allows the recreational consumption of the plant.

 

MANAGER

Horizons Medical Marijuana Life Science ETF belongs to the management company Horizons ETFs Gestión de Canadá and its subsidiary AlphaPr Management S.A. The manager includes a very diversified range of investment instruments with solutions for investors at all levels.

Horizons ETFs has more than 7,000 million dollars of assets under management with 76 ETFs listed on the Toronto Stock Exchange. This manager is a member of the Mirae Assets Global Group of Assets. This Asian group is based in Seoul. The group's main activity is asset management, but it also offers comprehensive financial services in the areas of wealth management and life insurance.

It is one of the largest investors in emerging equity markets. Mirae Asset Global Investments Group is present in Australia, Brazil, Canada, China, Colombia, Hong Kong, India, Korea, Taiwan, the United Kingdom, the United States and Vietnam. The company manages more than 90,000 million dollars in assets worldwide, on December 31, 2016.

 

 

Source: www.bolsamania.com