CannabisAfter a difficult start to the year, confidence is starting to build in the cannabis market again. After weeks of disappointing results, some of the more popular stocks like Aurora Cannabis (NYSE: ACB) and Tilray Inc. (NASDAQ: TLRY) were up on Monday. This coincides with a general increase in stock confidence as the S&P 500 hits record highs.

For investors who are cautious of individual cannabis stocks but still interested in the market, an Exchange Traded Fund could be the best option. The ETFMG Alternative Harvest ETF (NYSE: MJ) tracks many of the best bargain stocks and comes close to a bargain itself with a current pricing of $19.71. It also includes a strong dividend, which is something that is lacking when looking at component stocks individually.

This fund currently offers a dividend of $0.28 for a yield of 4.95%. It has a net expense ratio of 0.75%, which is relatively low considering the dividend. A high turnover percentage of 97% shows that the fund is being actively managed as the cannabis market matures.

Cannabis is fully legalized in Canada, while 10 states and Washington D.C. have legalized in the U.S. Other major markets like Germany have legalized for medical use, creating strong growth prospects for larger producers. The Alternative Harvest ETF is one of the least complicated ways to gain exposure.

Key Data:

  • Net Expense Ratio: 75%
  • Turnover: 97%
  • Yield: 95%

All information is based on current and historical market data, as well as publicly available financial data. As with any financial decision, your own research is important. Stock market outcomes can never be 100% accurately predicted. Familiarity with historical data, individual industries, and individual stocks is key to developing a robust portfolio. Note that stock prices can fluctuate rapidly during trading sessions.