PSIL: 3rd Quarter 2026 Portfolio Review
Portfolio
The AdvisorShares Psychedelics ETF (PSIL) consolidated in the third quarter after its strong first-half run, returning -4.56% (NAV) / -6.24% (market). The S&P 500 Index returned +2.30% over the same period.
Year to date, PSIL has gained +30.96% (NAV) / +30.85% (market). Over the trailing one-year period ending September 30, 2026, PSIL gained +30.97% (NAV) / +29.90% (market).
Portfolio
PSIL maintained an active management approach during the third quarter, with position sizing continuing to reflect the sector’s elevated volatility and the fast pace of clinical, regulatory, and corporate developments.
The most significant portfolio event of the quarter was corporate rather than clinical. On July 16, Eli Lilly & Co. (LLY) announced an agreement to acquire AtaiBeckley Inc. (ATAI) for $6.75 per share in cash, plus up to $2.50 per share in contingent value rights tied to future development and approval milestones for its 5-MeO-DMT and DMT programs. The deal values AtaiBeckley at about $2.8 billion upfront and up to $3.8 billion in total, making it the largest psychedelic acquisition to date. The transaction closed during the quarter. PSIL received cash for its AtaiBeckley shares and continues to hold the associated contingent value rights.
New positions were added in:
- Eli Lilly & Co. (LLY): +2,092 shares
- Seaport Therapeutics Inc. (SPTX): +94,000 shares
The following position was removed during the quarter:
- AtaiBeckley Inc. (ATAI), following its acquisition by Eli Lilly
Winners and Losers
Third-quarter performance varied meaningfully across the portfolio, as company-specific catalysts drove large moves in both directions.
Leading contributors during the quarter included:
- Helus Pharma Inc. (HELP): +88.30%
- Neuronetics Inc. (STIM): +80.00%
- Psyence Biomedical Ltd. (PBM): +83.43%
The largest detractors were:
- Relmada Therapeutics Inc. (RLMD): -45.52%
- Definium Therapeutics Inc. (DFTX): -19.09%
- NRx Pharmaceuticals Inc. (NRXP): -28.61%
Top Holdings
| Ticker | Security Description | Portfolio Weight % |
| DFTX | DEFINIUM THERAPEUTICS INC | 11.72% |
| CMPS | COMPASS PATHWAYS PLC | 11.44% |
| HELP | HELUS PHARMA INC | 9.08% |
| RLMD | RELMADA THERAPEUTICS INC | 4.82% |
| NBIX | NEUROCRINE BIOSCIENCES INC | 4.64% |
| LLY | ELI LILLY & CO | 4.61% |
| ABBV | ABBVIE INC | 4.54% |
| NRXP | NRX PHARMACEUTICALS INC | 4.48% |
| GHRS | GH RESEARCH PLC | 4.43% |
| JNJ | JOHNSON & JOHNSON | 4.36% |
As of 09.30.2026. Cash is not included. Holdings are subject to change.
Please see our complete fund holdings at advisorshares.com/etfs/psil. The holdings details are updated each market day.
Psychedelics Landscape
On the clinical front, Compass Pathways reported six-month data from COMP006, its second and larger Phase 3 trial of COMP360 psilocybin in treatment-resistant depression, closing out its Phase 3 program. The company expects to complete its NDA submission in the fourth quarter, with a potential launch in the first half of 2027.¹ Definium Therapeutics followed its positive Phase 3 readout of DT120 (LSD) in major depressive disorder earlier in the year with a positive first Phase 3 in generalized anxiety disorder in August, meeting its primary and all key secondary endpoints.² A second positive GAD study followed in September, and Definium is expected to target an NDA submission in the first half of 2027. In August, Resilient Pharmaceuticals, formerly Lykos Therapeutics, resubmitted its NDA for MDMA-assisted therapy for PTSD, two years after the FDA declined to approve it.³
Washington was unusually active. In mid-July, the FDA issued final guidance for clinical investigations of psychedelic drugs and scheduled a September public hearing on the future of psychedelic therapies, which took place during the quarter.⁴ The Department of Health and Human Services and the Department of Veterans Affairs entered into a partnership to advance research, clinical development, and potential deployment of rapid-acting mental health treatments, including psychedelics, for veterans.⁵ Federal agencies also funded ibogaine research for opioid use disorder through NIDA and ARPA-H, and HRSA sought public input on the health care infrastructure psychedelic therapies would require.
The quarter also marked a turning point in corporate interest. Eli Lilly’s agreement to acquire AtaiBeckley for up to $3.8 billion is the largest psychedelic acquisition to date, following Otsuka’s purchase of Transcend Therapeutics and AbbVie’s acquisition of Gilgamesh Pharmaceuticals’ lead candidate.⁶ In August, Johnson & Johnson signed a term sheet to lead an $85 million Series C financing for Delix Therapeutics, a developer of non-hallucinogenic neuroplastogens.⁷ This growing presence of large pharmaceutical companies, several of which PSIL holds directly, provides validation for the field and a potential path to exit for smaller developers.
It’s worth being precise about where things stand: as of the end of the third quarter, psilocybin, LSD, and MDMA remain Schedule I controlled substances under federal law. FDA approval is not guaranteed for any program and still requires the agency’s full evidentiary standard to be met.
Outlook
As we move into Q4 2026, the sector faces its most catalyst-dense period yet. Compass Pathways is expected to complete its NDA submission for COMP360, and its Commissioner’s National Priority Voucher could substantially shorten the FDA’s review once that submission is complete. Helus Pharma expects topline Phase 3 data for its deuterated psilocin candidate (CYB003) in adjunctive major depressive disorder during the fourth quarter. The FDA’s review of Resilient’s MDMA resubmission is also underway. Together, these milestones could bring the first FDA approval of a psychedelic therapy within the next few quarters, though none is assured.
We expect volatility to persist at the individual position level, as the third quarter showed, since even positive readouts can be priced in ahead of time. The fund will continue to actively manage exposures as clinical, regulatory, and corporate milestones unfold.
Sources:
1. Psychedelic Alpha. Compass Closes Out Phase 3 With 6-Month COMP006 Data, Eyes H1’27 Launch. July 7, 2026.
2. Psychedelic Alpha. Smooth Sailing: Definium’s LSD Voyage Hits Primary and Key Secondary Endpoints in GAD. August 12, 2026.
3. Psychedelic Alpha. Two Years After Rejection, Resilient Quietly Refiles MDMA for PTSD Application. August 12, 2026.
4. Psychedelic Alpha. FDA Issues Final Psychedelics Guidance, Schedules September Hearing on the Future of Psychedelic Therapies. July 13, 2026.
5. U.S. Department of Health and Human Services. HHS & VA Announce Bold, Comprehensive Partnership to Advance Rapid-Acting Mental Health Treatments for Veterans. July 13, 2026.
6. Psychedelic Alpha. Breaking: World’s Largest Pharmaceutical Company, Eli Lilly, Acquires 5-MeO-DMT Developer AtaiBeckley for Up to $3.8 billion. July 16, 2026.
7. Psychedelic Alpha. Scoop: Johnson & Johnson to Lead Delix Therapeutics’ $85M Series C. August 18, 2026.
—————————————————————————————————
To get updates on the funds, tune in to AdvisorShares’ AlphaNooner Show streaming live each regular weekday starting at 12:00 pm (East Coast time), where I am a guest almost every Tuesday. Other important guests from the psychedelics world often join too. Find it on most major social media platforms or visit our the AdvisorShares “Events” webpage for more information.
Cheers,
Past Commentary
The S&P 500 Index is a broad-based, unmanaged measurement of changes in stock market conditions based on the average of 500 widely held common stocks.
Before investing you should carefully consider the Fund’s investment objectives, risks, charges and expenses. This and other information is in the prospectus or summary prospectus, a copy of which may be obtained by visiting www.advisorshares.com. Please read the prospectus carefully before you invest. Foreside Fund Services, LLC, distributor.
There is no guarantee that the Fund will achieve its investment objective. An investment in the Fund is subject to risk, including the possible loss of principal amount invested.
Psychedelic drugs, also known as hallucinogens, are a group of substances, including psilocybin, that are used to change and enhance sensory perceptions, thought processes, and energy levels. Psychedelic medicines, therapeutics, and healthcare treatments may be used in the treatment of illnesses such as depression, addiction, anxiety and post-traumatic stress disorder. Psychedelic medicine companies include life sciences companies having significant business activities in, or significant exposure to, the psychedelics industry including producers or distributors of psychedelic medicines, biotechnology companies engaged in research and development of psychedelic medicines, and companies that are part of the supply chain for psychedelics.
Psychedelics Companies Risk. Psychedelics companies are subject to various laws and regulations that may differ at the state/local and federal level. These laws and regulations may significantly affect a psychedelics company’s ability to secure financing, impact the market for psychedelics and business sales and services, and set limitations on psychedelics use, production, transportation, and storage. There can be no guarantees that such approvals or administrative actions will happen or be favorable for psychedelics companies, and such actions may be subject to lengthy delays, and may require length and expensive clinical trials. Additionally, therapies containing controlled substances may generate public controversy. Political and social pressures and adverse publicity could lead to delays in approval of, and increased expenses for, companies and any future therapeutic candidates they may develop. All of these factors and others may prevent psychedelics companies from becoming profitable, which may materially affect the value of certain Fund investments. In addition, psychedelics are subject to the risks associated with the biotechnology and pharmaceutical industries.
In Canada, certain psychedelic drugs, including psilocybin, are classified as Schedule III drugs under the Controlled Drugs and Substances Act (“CDSA”) and, as such, medical and recreational use is illegal under Canadian federal laws. In the United States, certain psychedelic drugs, including psilocybin, are classified as Schedule I drugs under the Controlled Substances Act (“CSA”) and the Controlled Substances Import and Export Act (the “CSIEA”) and, as such, medical and recreational use is illegal under the U.S. federal laws. There is no guarantee that psychedelic drugs or psychedelic-inspired drugs will ever be approved as medicines in either jurisdiction.
In the United States, scheduling determinations by the Drug Enforcement Agency (“DEA”) are dependent on Food and Drug Administration (“FDA”) approval of a substance or a specific formulation of a substance. Unless and until psilocybin, psilocin, or other psychedelics-based products receive FDA approval, such products may be prohibited from sale, which could limit the growth opportunities for certain portfolio companies of the Fund. Even if approved by the FDA, the manufacture, importation, exportation, domestic distribution, storage, sale, and legitimate use of such products will continue to be subject to a significant degree of regulation by the DEA.
Security prices of small cap companies may be more volatile than those of larger companies and therefore the Fund’s share price may be more volatile than those of funds that invest a larger percentage of their assets in securities issued by larger-cap companies. These risks are even greater for micro-cap companies.
Shares are bought and sold at market price (closing price) not NAV and are not individually redeemed from the Fund. Market price returns are based on the midpoint of the bid/ask spread at 4:00 pm Eastern Time (when NAV is normally determined), and do not represent the return you would receive if you traded at other times.
Holdings and allocations are subject to risks and change.
The views in this commentary are those of the portfolio manager and many not reflect his views on the date this material is distributed or any time thereafter. These views are intended to assist shareholders in understanding their investments and do not constitute investment advice.