New pot ETF called ‘YOLO’ cuts the price needed to invest in cannabis

FILE -- Marijuana grows at a dispensary in Secaucus, N.J., July 11, 2018. Most employers in New York City will no longer be able to force job applicants to take mandatory tests for marijuana use, under a bill overwhelmingly approved in April 2019 by the New York City Council. (Bryan Anselm/The New York Times)
Bryan Anselm/The New York Times
Marijuana grows at a dispensary in Secaucus, NJ, in July 2018.

A new exchange-traded fund focused on marijuana stocks plans to undercut competitors when it debuts just days before an unofficial pot holiday.

With a ticker of YOLO — “You Only Live Once” — the AdvisorShares Pure Cannabis ETF will charge 74 basis points, or $7.40 for every $1,000 invested, according to regulatory documents. That’s 1 basis point less than the ETFMG Alternative Harvest ETF, known as MJ.

“Launching 1 basis point cheaper than MJ is a bit absurd, but symbolic of the era we are in right now where expense ratio is one of the first things an adviser looks at,” said Eric Balchunas, an ETF analyst at Bloomberg Intelligence. “This ETF has at least a fighting chance to find an audience.”


The fund is poised to make history as the first US ETF to include cannabis in its name, data compiled by Bloomberg show. Issuers have struggled to start funds that directly reference marijuana, in part due to concern among custodians and other service providers over the legality of the business. The US Securities and Exchange Commission is also increasingly asking thematic funds to justify their names.

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Bank of New York Mellon will act as YOLO’s custodian, administrator, and transfer agent, according to regulatory filings.

The fund plans to list in New York on Thursday, just two days shy of April 20 — aka 4/20, pot-user slang for smoking cannabis.