Roundhill Investments has re-focused the exposure of its Roundhill Cannabis ETF to exclusively target the largest and most-liquid U.S. multi-state operators ("MSOs"). In addition, Roundhill has agreed to lower the WEED ETF's net expense ratio to 0.39% until at least April 30, 2023. Based on the fee waiver, WEED is now the lowest-cost cannabis ETF globally.
Due to current macroeconomic conditions, including high-interest rates and persistent inflation, Roundhill believes that the cannabis companies with the lowest costs of capital and strongest relative balance sheets are best positioned to survive a downturn and increase market share. Tier 1 MSOs, defined as U.S. cannabis companies generating in excess of $500 million in annual revenues, most closely align with this view.
As of October 11, 2022, the WEED ETF maintained concentrated economic exposure to six MSOs: Curaleaf Holdings (34.5% weight), Green Thumb Industries (20.3% weight), Trulieve Cannabis (17.2% weight), Verano Holdings (14.4% weight), Cresco Labs (8.7% weight), and Columbia Care (4.2% weight).
For more information: