S Year-End Summary: The Conservative Pot Stock Index Outpaced Its Cannabis Partners +6% To - 51%

Why not consider taking a more conservative approach and invest in the 6 tobacco, beer and liquor companies that have invested heavily in the cannabis industry and are the constituents in the munKNEE Conservative Pot Stocks Index? It went UP +5.8% in 2021 and its constituents pay out hefty dividends to boot.

Note that each constituent has hyperlinks to 3 areas of additional information which are imperative for any individual considering investing in this sector:

  • The company name is hyperlinked to its web site to provide you with a description of the company and an analysis of its stock.
  • The trading symbol is hyperlinked to additional financial data and commentary on the company (where available).
  • The percentage increase YTD is hyperlinked to a chart of the company's stock performance YTD.

The munKNEE Conservative Pot Stocks Index

The performance of its constituents in 2021 are compared below with their associated cannabis stocks as follows, in descending order:

  1. Altria Group (MO) went UP +17.6% and has a Dividend Yield of 7.5%.
    • The company has a 45% stake in Cronos Group Inc. (CRON) which went DOWN -43.5% in 2021 and pays out no dividend.
  2. Constellation Brands (STZ) went UP +14.9% and has a Dividend Yield of 1.26%.
    • The company has a 39% stake in Canopy Growth Corporation (CGC) which is DOWN -64.6% in 2021 and pays out no dividend.
  3. Imperial Brands (IMBBY) went UP +8.1% and has a Dividend Yield of 12.1%.
    • The company has a 19.9% stake in Auxly Cannabis Group Inc. (CBWTF) which went DOWN -30.0% in 2021 and pays out no dividend.
  4. Molson Coors (TAP) went UP +2.6%) and has a Dividend Yield of 3.0%.
    • The company has a 57.5%/42.5% joint venture, called TRUSS, with Hexo Corp. (HEXO) which went DOWN -81.0% in 2021 and pays out no dividend.
  5. British American Tobacco (BTI) went UP +1.7%  and has a Dividend Yield of 8.0%. 
    • The company has a C$221M investment and product development partnership with Organigram Holdings Inc. (OGI) which went UP +31.6% in 2021 but pays out no dividend.
  6. Anheuser-Busch (BUD) went DOWN -13.4% and has a Dividend Yield of 1.0%.
    • The company has a $100 million joint venture with Tilray Inc. (TLRY) which went DOWN -14.9% in 2021 and pays out no dividend.

In Summary

  • Stock Performances:
    • the Conservative Pot Stocks Index went UP +5.8% in 2021 while
    • their marijuana partners went DOWN -50.7%, on average, in 2021.
  • Dividend Yields:
    • the Conservative Pot Stocks Index constituents have dividends that currently yield 3.5%, on average, while
    • their marijuana partners pay out no dividends.

AdvisorShares VICE (VICE) ETF

Another similar way to invest indirectly in cannabis stocks is to invest in the AdvisorsShares VICE (VICE) ETF. It is an actively managed ETF (net expense ratio of 0.99%) that invests in companies that derive at least 50% of their net revenue from:

  1. gambling/casino companies: 36%,
  2. restaurant/hospitality industry: 19%,
  3. alcoholic beverage companies (includes Constellation Brands): 17%,
  4. tobacco companies (includes all the tobacco constituents in the Conservative Pot Stocks Index except Imperial Brands): 10%,
  5. video games and eSports sector: 8%,
  6. psychedelic compound-based clinical-stage drug companies: 1%, and
  7. other sectors: 9%

VICE went UP +7.4% in 2021 compared to +5.8% for the munKNEE Conservative Pot Stocks Index.

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