The United States’ first actively managed psychedelics exchange-traded fund (ETF) launched today on the New York Stock Exchange (NYSE) Arca.
The AdvisorShares Psychedelics ETF has commenced trading on the exchange under the ticker symbol PSIL. According to AdvisorShares, the ETF will invest in the emerging psychedelic drugs sector, offering investors exposure to the biotechnology, pharmaceutical, and life sciences companies AdvisorShares sees as leading the way in this nascent industry.
PSIL’s portfolio will concentrate on companies deriving the majority of their net revenue or devoting the majority of their assets to psychedelic drugs. AdvisorShares also said PSIL might offer exposure to companies not found in other ETFs.
“With research showing positive results in treating mental health issues, a focus on medical rather than recreational use, and changing legalization, we believe psychedelics could cause a seismic shift in the evolution of medicine,” the company said. “Because this sector will see ongoing change and volatility, we think it is best to view PSIL as a long-term growth opportunity.”
This ETF is actively managed daily, meaning Portfolio Manager Dan Ahrens can adjust the portfolio more quickly and opportunistically than a passive, index-based strategy which is usually adjusted during a periodic rebalancing. Ahrens is also the Portfolio Manager of the Pure US Cannabis ETF, the first ETF to offer US investors exposure to cannabis stocks, and the Pure Cannabis ETF.
“We believe that investing in select companies in the psychedelics space can provide a compelling long-term investment opportunity,” said Ahrens, who is also AdvisorShares’ Chief Operating Officer. “However, this is also an area of the marketplace in its early innings. We feel that our active management and specialized approach can potentially help investors capture the early growth potential of psychedelics and its prominent promise on therapeutics and medical fields.”
AdvisorShares CEO Noah Hamman added: “We believe that delivering this strategy in an ETF structure with daily transparency, intraday liquidity, and operational efficiency provides an ideal way for advisors and investors to access this burgeoning market. As we continue to navigate highly specialized areas of the marketplace, we also remain steadfastly committed to providing ongoing investment education for our ETF shareholders, prospective investors, and the investment community at large.”
PSIL is the third psychedelics ETF to hit the markets after the launch of the world’s first psychedelic ETF earlier this year. The Horizons Psychedelic Stock Index ETF commenced trading on Canada’s NEO Exchange on January 26, under the ticker symbol PSYK. Just a few months later, US investors were also able to access a psychedelics ETF, with the launch of the Defiance Next Gen Altered Experience ETF, ticker symbol PSY, on the NYSE.
