Investors have jumped onto the marijuana bandwagon in droves. Even the tiniest of cannabis companies are attracting attention, and some of their share-price increases have been nothing short of spectacular. For those who prefer to get diversified exposure to the marijuana sector, the ETFMG Alternative Harvest ETF (NYSEMKT:MJ) has held itself out as a first-moving marijuana-focused exchange-traded fund for U.S. investors. Already, the ETF has attracted more than $700 million in assets, and the recent gains for cannabis stocks make it likely that the fund will bring in even more money, especially given its 50% rise in the past six weeks…
Alternative Harvest holds nearly 40 stocks, including not only marijuana producers but also pharmaceutical and biotech companies looking at the potential uses of cannabis in the medical profession and consumer-oriented companies that have expertise in selling smokeable products. Yet four of those marijuana stocks really stand out for their impressive performance so far in 2018. All four have doubled this year, and they all seem to have potential for further growth in the future.
The leader of the pack
Tilray (NASDAQ:TLRY) is Alternative Harvest’s biggest holding. The ETF owns 467,000 shares of Tilray worth $77 million as of Oct. 1, and the position makes up almost 11% of the fund’s total assets.
The most impressive thing about Tilray’s role in the ETF is that the stock hasn’t even been public all year. Tilray had its initial public offering just in July, but already, its share price has soared almost 600% from its first-day IPO price. Investors jumped into Tilray in part because it represented a pure play on marijuana, the first to go public in the U.S. market, and a limited offering of just 9 million shares means that Alternative Harvest currently owns around 5% of the stock’s total float. Skeptics believe that Tilray could easily see a huge decline, but for now, traders are happy to use the shares to speculate on the coming legalization of recreational cannabis in Canada later this month.
The fan favorite
Before Tilray came along, Canopy Growth (NYSE:CGC) routinely found itself at the top of Alternative Harvest’s holdings list. Even now, the stock is…
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