Investors for the first time will be able to purchase exchange-traded funds to bet against pot stocks – or alternatively, double down on a wager that the cannabis sector is about to move higher.
Leveraged ETFs – also known as “double ETFs” – typically aim to deliver two or three times the return on their stated index, while the inverse sees profits when returns on an index decline. These products carry a higher risk rating than typical ETFs.Horizons ETFs is the only provider of leveraged ETFs in Canada, with 25 leveraged funds on its shelf. The funds will exist within its existing BetaPro fund lineup, and carry a management fee of 1.45 per cent.
“There is significant demand from investors to ‘short’ marijuana stocks because they think it is oversold,” said Mr. Hawkins, president and CEO of Horizons. “We are in the business of providing liquid trading opportunities to the marketplace with our Betapro lineup and these products are going to complement that.”
The company had originally filed for the funds last summer – along with a third ETF that would provide two times the inverse