The first actively managed pot ETF in the U.S. hasn’t attracted the early inflows of its competitors but is breaking down other barriers for the industry.
As of Thursday, the end of its second week of trading, the AdvisorShares Pure Cannabis ETF (ticker: YOLO) had attracted $42.5 million (U.S.) of assets via eight straight days of inflows. That pales in comparison to the $321 million the ETFMG Alternative Harvest ETF drew in its first couple weeks, when it was the only U.S.-traded pot ETF, but outpaced other funds launched in the last few weeks, according to data compiled by Bloomberg.
YOLO may have done something more important for the cannabis industry than entice investors, however. The pot exchange-traded fund is the first to have a major U.S. bank serve as its custodian. Bank of New York Mellon Corp. has been working with AdvisorShares since 2009 and saw no reason to change that because of its entry into the cannabis space, according to a bank spokesman. Custodians hold stock and settle trades for funds that invest in publicly traded companies.
“We have always considered the needs and interests of our ETF clients across global markets as they evolve, and this is no different,” the spokesman said in an email. “The fund has been reviewed in accordance with our internal governance