Reticent about investing directly in cannabis stocks given that the seed-to-sale sector of Canadian LPs and American MSOs was DOWN -7.8% in September and is DOWN -9.9% YTD (see details by constituent here)? Perhaps you should consider investing in cannabis-related companies such as the major tobacco, beer, liquor or pharmaceutical companies that are heavily invested in the cannabis industry, pay dividends and are outperforming the seed-to-sale sector. Here is a look at that market sector, with some ideas on where you might consider investing to that end.

The munKNEE Conservative Pot Stocks Index tracks the performance of 8 such major tobacco, beer/liquor, and other companies, and they are compared with their associated cannabis stocks and with 2 other sector categories tracked by munKNEE.com.

All 8 index constituents were DOWN in September with 4 of them DOWN YTD. The details are as follows, in descending order:

1. Imperial Brands PLC (IMBBY) was DOWN -0.4% in September but is still UP +4.5% YTD and now has a Dividend Yield of 5.4%.
   • The company has a 19.9% stake in Auxly Cannabis Group Inc. (CBWTF) which was DOWN -9.5% in September, is now DOWN -5.0% YTD and pays out no dividend.
2. Constellation Brands Inc. (NYSE: STZ) was DOWN -0.8% in September, is now DOWN -3.5% YTD and now has a Dividend Yield of 1.4%.
   • The company has a 39% stake in Canopy Growth Corporation (NYSE: CGC) which was DOWN -19.4% in September and is now DOWN -43.8% YTD and pays out no dividend.
3. Molson Coors Brewing Company (NYSE: TAP) was DOWN -2.4% in September but is still UP +5.8% YTD and now has a Dividend Yield of 2.9%.
   • The company has a 57.5%/42.5% joint venture, called TRUSS, with Hexo Corp. (NYSE: HEXO) which was DOWN -24.3% in September, is now DOWN -50.0% YTD and pays out no dividend.
4. British American Tobacco (BTI) was DOWN -5.4% in September, is now DOWN -4.1% YTD and now has a Dividend Yield of 8.6%. 
   • The company has a C$221M investment and product development partnership with Organigram Holdings Inc. (OGI) which was DOWN -12.2% in September but is still UP +72.9% YTD and pays out no dividend.
5. Alimentation Couche-Tard Inc. (ANCUF) was DOWN -5.8% in September but is still UP +12.0% YTD with a Dividend Yield of 0.7%.
   • The company has a 9.9% ownership stake in Fire & Flower Holdings Corp.  (FFLWF) which was DOWN -9.6% in September and is now DOWN -2.9% YTD and pays out no dividend.
6. Altria Group, Inc. (NYSE: MO) was DOWN -8.1% in September but is UP +12.9% YTD with a  Dividend Yield of 7.9%.
   • The company has a 45% stake in Cronos Group Inc. (Nasdaq: CRON) which was DOWN -12.2% in September and is now DOWN -18.4% YTD and pays out no dividend.
7. Anheuser-Busch InBev SA (NYSE: BUD) was DOWN -8.1% in September and is now DOWN -19.4% YTD with a Dividend Yield of 1.1%.
   • has a $100 million joint venture with Tilray Inc. (Nasdaq: TLRY) which was DOWN -15.9% in September but is still UP +36.7% YTD but pays out no dividend.
8. Novartis AG (NYSE: NVS) was DOWN -11.1% in September and is DOWN -9.6% YTD with a Dividend Yield of 3.9%.
   • The company has a global agreement with Tilray Inc. (Nasdaq: TLRY) allowing it to use the Sandoz supply chain, sales force, and global distribution network which, as mentioned above, was DOWN -15.9% in September but is still UP 36.7% YTD but pays out no dividend.

In summary

• Stock Performance:
  • the Conservative Pot Stocks Index was DOWN -4.7% in September and is now DOWN -3.7% YTD
  • compared to their marijuana partners which were DOWN -16.7% in September and are now DOWN  -12.8% YTD, on average.
• Dividend Yields:
  • the Conservative Pot Stocks Index constituents have dividends that currently yield 5.1%, on average,
  • while their marijuana partners have no dividends.

The above non-tradable indices replicate the performance of a portfolio investing an equal amount of money in each company in the various cannabis categories, with daily rebalancing to maintain equal weight, to serve as benchmarks to measure the performance of individual stocks compared to their respective index. We believe this overview of the cannabis stock sector is the most insightful analysis to be found anywhere.