WEED Profile
The Roundhill Cannabis ETF is an actively managed exchange-traded fund (ETF) designed to offer targeted exposure to the cannabis and hemp sectors. The fund primarily invests in equity securities and total return swaps that are listed on major exchanges, focusing on companies and real estate investment trusts (REITs) involved in the cannabis and hemp industries. This investment approach aims to capture growth opportunities within these emerging markets by concentrating on securities that are integral to the cannabis ecosystem.
The fund's strategy involves allocating at least 80% of its net assets into equity securities, which include common stocks and depositary receipts of companies engaged in the cannabis and hemp sectors. To qualify for inclusion, these companies must derive at least 50% of their net revenue from cannabis-related activities or invest a majority of their assets in the cannabis and hemp ecosystem. This focus ensures that the fund is heavily invested in firms directly linked to the cannabis industry, ranging from cultivation and production to ancillary services and real estate investments.
As an actively managed ETF, the Roundhill Cannabis ETF benefits from ongoing research and analysis by fund managers who actively select securities based on their potential to deliver returns in the evolving cannabis market. The fund may include a diverse range of investments within the cannabis industry, such as growers, processors, and distributors, as well as companies involved in hemp-based products and services. This comprehensive approach allows investors to gain broad exposure to the sectors growth potential.
The fund is categorized as non-diversified, which means it may have a concentrated exposure to specific sectors and industries within the cannabis and hemp markets. This concentration can result in increased volatility and higher risk compared to more broadly diversified funds. However, it also provides a focused investment strategy for those looking to capitalize on the expansion and development of the cannabis industry.
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