ETF Managers Group has completely renovated an old ETF and launched the first ETF to track companies that benefit from the increased acceptance of various uses of the cannabis plant.
As of December 26, the ETF Managers Group revamped the Tierra XP Latin America Real Estate ETF (NYSEArca: LARE) and turned it into the ETFMG Alternative Harvest ETF (NYSEArca: MJX), which comes with a 0.75% expense ratio.
The Alternative Harvest ETF will try to reflect the performance of the Prime Alternative Harvest Index, which is comprised of global companies engaged in the legal cultivation of cannabis, or the legal production, marketing or distribution of cannabis products for medical or non-medical purposes; engaged in the lawful creation, marketing or distribution of prescription drugs that utilize cannabinoids as an active ingredient; trade tobacco or produce tobacco products, such as cigarettes, cigars or electronic cigarettes; produce cigarette and cigar components, such as cigarette paper and filters; and engaged in the creation, production and distribution of fertilizers, plant foods, pesticides or growing equipment to be used in the cultivation of cannabis or tobacco, according to a prospectus sheet.
Related: A ‘New’ Marijuana ETF
While the underlying index may cover businesses that are legally engaged in activities related to cannabis, the benchmark does not include those that directly cultivate, produce or distribute marijuana or products derived from marijuana, unless such activities become legal under U.S. federal and state laws.