The first cannabis ETF, the ETFMG Alternative Harvest ETF (MJ), launched in December of 2017. But its launch has an interesting backstory. This was not originally a marijuana ETF, but was converted from a Latin American real estate ETF. That move allowed MJ to avoid some of the regulatory scrutiny facing new entrants to the cannabis ETF market today. But it has also painted the ETF in something of a corner as well. It does not hold a lot of the pureplay cannabis names now being allowed in the new ETFs launching today that have satisfied regulators by obtaining outside legal opinions. As a result, it cannot have the word cannabis in its name, as 80% of the holdings in aggregate do not meet the purity test of having at least 50% in cannabis or hemp-related revenues.
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