The munKNEE Pure-Play Pot Stock Index went up 19.9% during the first week of January and another 14.4% this past week making for a cumulative increase of 37.2% since the end of December 31st. This article provides the details of those moves.

(For more information on the reason(s) behind the changes outlined below you are urged to click on the stock symbols provided. All currency amounts are in U.S. dollars. Go here to convert to another currency.)

Index Performance

The criteria for being included in the Index is that the stock is consistently trading for a minimum of US$1/share and generates 100% of its revenue directly from the sale of cannabis products.

Federal marijuana legalization in the U.S. is required for Canadian Licensed Producer (LP) companies to be able to do business in the country and the Democrats have expressed favorable views about introducing such legislation to make that possible. The Canadian LPs continue to respond in a dramatic fashion to the Democrats' winning the two Senate seats in Georgia giving them a majority in the Senate.

The Canadian Licensed Producer (LP) Category has gone up 58.5% in the first 2 weeks of 2021 with 9 of the 10 stocks within the category advancing, in descending order, as follows:

1. Tilray* (TLRY): +138.5% to $19.70/share
2. Hexo** (HEXO): +95.9% to $7.21/share
3. Aphria* (APHA): +79.5% to $12.42/share
4. Valens (VLNCF): +60.0% to $2.08/share
5. Cronos (CRON): +57.5% to $10.93/share
6. Aurora (ACB): +44.9% to $12.04/share
7. Canopy (CGC) +35.5% to $33.39/share
8. Organigram (OGI) +35.3% to $1.70/share
9. Neptune (NEPT): +29.5% to $2.02/share
10. Rubicon (ROMJF): -5.7% to $2.67/share

* Aphria and Tilray announced plans to merge, creating what will be the largest global cannabis company by revenue; **HEXO and beverage giant Molson Coors (NYSE:TAP) announced that their joint venture, Truss CBD USA, is preparing to launch a new beverage.

The Democratic sweep is expected to mean there will be a vote on legalization, and the MSOs have responded positively in a major way to that likelihood.

The U.S. Multi-State Operator (MSOs) Category has gone up 27.9% during the first 2 weeks of 2021 with 19 of the 20 constituents advancing and 1 declining marginally (-5.7%), as follows:

1. Acreage*** (ACRDF + ACRHF): +110.8% to an average of $10.94
2. Vireo Health (VREOF): +87.2% to $2.77/share
3. Charlotte's Web (CWBHF): +45.5% to $4.80/share
4. Harvest Health (HRVSF): +44.9% to $3.13/share
5. Harborside (HBORF): +39.5% to $2.19/share
6. Trulieve (TCNNF): +36.8% to $43.31/share
7. TerrAscend (TRSSF): +34.8% to @ $13.55/share
8. Cresco (CRLBF): +33.9% to $13.22/share
9. cbdMD (YCBD): +33.6% to $3.94/share
10. Curaleaf (CURLF): +29.9% to $15.55/share
11. Columbia (CCHWF): +26.1% to $7.63/share
12. Indus (INDXF): +22.8% to $1.40/share
13. Green Thumb (GTBIF): +14.9% to $28.15/share
14. Ayr (AYRSF): +14.4% to $27.20/share
15. Medicine Man (SHWZ): +13.7% to $1.73/share
16. Planet 13 (PLNHF): +1.8% to $5.95/share
17. Jushi (JUSHF): +1.5% to $5.61/share
18. IM Cannabis (IMCNF): +0.5% to $2.00/share
19. C21 (CXXIF): -5.7% to $1.33/share

***Canopy Growth's original deal was to buy 100% of Acreage Holdings when the U.S. federally legalized cannabis. That deal was recently amended and has resulted in the creation of two new share classes which began trading on the OTCQX on October 7, 2020, namely, Class D “floating” shares (ACRDF) and Class E “fixed” shares (ACRHF) In the new deal, Canopy will buy only 70% of Acreage at the fixed share price. The remaining 30% will float with the market enabling Canopy shareholders to participate in any upside in the stock. Canopy has the option to buy these shares if they so decide.

• Retail investors prefer the "fixed" share class because they know that Canopy will buy these shares while the "floating" shares are only an option to buy and if Canopy decided not to buy the "floating" shares they would become much less valuable.
• Analysts, however, have been using the "floating" shares for their basis of valuation - not the "fixed" shares.
• Given the confusion mentioned above, the "fixed" and "floating" shares prices are added together in the Index to better highlight and record the price trend of  Acreage within the pure-play market sector.

Further details regarding the equal-weighted munKNEE Pure-Play Pot Stock Index are as follows:

• Only 30 stocks qualify for inclusion in the Index out of a total of over 225 (pure-play and ancillary) trading on North American exchanges.
• The average market capitalization of the 30 constituents is US$1.5B, as follows:
  • 10 have market caps ranging between $1.0B and $10.0B;
  • 5 have market caps between $500M and $999M;
  • 12 have market caps between $100M and $499M and
  • 3 have market caps of less than $100M