MSOS: 3rd Quarter 2021 Portfolio Review
For another calendar quarter, cannabis stocks have been quite challenging overall while we have been waiting for new catalysts. Whether Canadian or U.S. cannabis stocks, they seemed to hit their highs about February 10th and have been largely negative since.
AdvisorShares Pure US Cannabis ETF (NYSE: MSOS) launched on September 2, 2020 and now has hit its 1-year anniversary. Having been over $1 billion at times earlier in the year, the Fund ended September 2021 with over $870 million in assets under management. Despite frustrating performance from underlying cannabis stocks, the Fund’s assets, in the form of outstanding shares, have grown.
For the 3rd quarter, MSOS returned -21.35% on its net asset value (NAV) and -21.36% on its market price. From lows back on October 1, 2020, the Fund’s trailing 1-year returns through the end of September 2021 are 45.21% (NAV) and 43.79% (market price). As I’m writing this commentary, the downtrend since February of this year has continued as politicians continue to play politician games, negatively affecting cannabis stocks as investors await reforms.
Investors need to remember that cannabis stocks are going to be extremely volatile. This market volatility is amplified for those stocks trading on the U.S.’s over the counter (OTC) market. In our opinion, U.S. cannabis fundamentals are very strong and revenues are growing. While it’s widely agreed that U.S. cannabis reforms are coming, we simply don’t know the timing or the extent.
During the quarter, MSOS added new positions in Urban-Gro Inc (NASDAQ: UGRO) and Agrify Corp (NASDAQ: AGFY). In a reversal from earlier in the year, we’ve been adding to these stocks, as well as, a few other quality cannabis ancillary names for liquidity and stability purposes.
Contributors / Detractors:
During the 3rd quarter, most of the fund’s holdings had losses. A few bright spots (yet again) were cannabis REITS, notably, Innovative Industrial Properties (NYSE: IIPR) and Power REIT (NYSE American: PW). Most planting-touching U.S. cannabis stocks were negative.
|Ticker||Security Description||Portfolio Weight %|
|GTBIF||GREEN THUMB INDUSTRIES SWAP REC||9.15%|
|CURLF||CURALEAF HOLDINGS INC SWAP REC||7.91%|
|IIPR||INNOVATIVE INDUSTRIAL PROPER||6.40%|
|TCNNF||TRULIEVE CANNABIS SWAP REC||6.22%|
|CRLBF||CRESCO LABS INC SWAP REC||5.84%|
|AYRWF||REC AYR WELLNESS INC||5.78%|
|CURLF||CURALEAF HOLDINGS INC SWAP REC||4.77%|
|GTBIF||GREEN THUMB INDUSTRIES SWAP REC||4.44%|
|VRNOF||VERANO HOLDINGS CORP SWAP REC||4.31%|
|CRLBF||CRESCO LABS INC SWAP REC||4.05%|
As of 09.30.2021. Cash is not included. Subject to change.
Please see our complete Fund holdings at advisorshares.com/etfs/msos. The holdings details are updated each market day.
To get updates on the funds, tune in to AdvisorShares’ Alpha Nooner Show streaming live each regular weekday starting at 11:50 am (East Coast time), where I am a guest almost every Tuesday. Find it on most major social media platforms or visit our the AdvisorShares “Events” webpage for more information.