Sectors

The MJ PurePlay Index was designed to provide the capital markets with an honest and comprehensive benchmark with which to judge the performance of marijuana centric publicly traded equities. The hodgepodge of existing sites, with their limited and questionable marijuana exposure, has left investors open to exaggerated claims and outright fraud. In response to this “lack of credible evaluation methods” PurePlay has started the world’s first and most comprehensive Marijuana Index. Think of it as an improved S&P/Dow Jones Industrial Average that you may be used to. All companies in this list are in the marijuana business, they are not biotech firms working with THC, or fertilizer companies that sell grow lights.

The goal is for the individual investor or institutional client to gain the most comprehensive, and pure play exposure to this rapidly growing market. There are few industries out there that are expected to have compounded 20%+ growth rates over the next five-10 years. Instead of attempting to find the next Amazon, Starbucks, or Netflix, the Index provides a safer and more honest basket with which to measure the industry as a whole.

It should be expected that as the annual sales figures grow for the sector there will be winners and losers. It is expected that many firms will make massive gains, and likewise there will be firms that fold and go bankrupt. What is important is that investors survive the down turns and get a safer (but much slower) long-term growth rate by not swinging for the fences with just one or two firms. To those people that think they know I shall leave them with three names- AOL, WorldCom, and Countrywide.

Stocks in the Index

The MJ PurePlay Index is made up of the top 100 Marijuana stocks with a
$47.98 million minimum market cap required for allocation.
Allocation percentage is based on each company’s market cap in relation to the
$69 Billion+ Total Market Cap of the Index.

Leadership

FAQs

The inclusion of the top 100 marijuana stocks is broad enough to capture all facets of the previously illegal space while not falling into ownership of microcap firms with not assets.

The MJ PurePlay index is a market cap weighted index that allocates exposure based on the size of the 100 firms. The bigger the firm the bigger the exposure.

The growing marijuana industry is ripe for fraud and abuse. Just like in the dot.com days, firms and startups are looking to juice up their values without hard work or honest business practices. Within the last year we have seen firms put out press releases build on nothing but carefully crafted get rich quick stories, enticing the public with dreams of 1000%+ returns.

The Marijuana space is slowly moving from the Wild Wild West to real businesses with real earnings. Just like the Internet Bubble of the late 1990’s many firms were swinging for the fences hoping to raise money and strike it rich. The lure of getting in early, is a powerful tool in separating investors from their money. Many ETF providers and Newsletter promoters have dangled companies that do not have direct marijuana exposure. It has been this bait and switch practice that was the impetus for the creation of this index.

Legal marijuana is massive and pardon the pun, growing like a weed. North American legal marijuana sales already exceed U.S. domestic sales of U.S ice cream, egg sales, baby diapers, multivitamins, or perfume. Estimates call for 2018 sales to reach 10.8 billion surpassing Halloween spending and horse track betting

The legal marijuana market is projected to grow at a 30%+ CAGR for the next five years, and has the possibility to exceed 22 billion is sales by the end of 2020. As more states change their laws these numbers could go even higher. Federal reclassification of marijuana from a Schedule 1 narcotic to a lower medicinal level opens up the market to even greater numbers as it has already been seen to have legitimate medicinal uses beyond recreation.

PurePlay is in fact pure. It brings you the top 100 marijuana firms and records their combined performance in a way that you as an individual investor can use as a benchmark with which to judge individual firms in the industry. By comparing how an individual firm did vs its peers you are empowered to make realistic judgements as to how your firm is doing.

The MJ PurePlay Index will rebalance the top 100 holdings twice a year. This rebalancing will take place on semi-annually on March and September.

Rebalancing an the Index at year end sounds nice and clean, but in fact is probably one of the worst times. The added volatility in what is a thinly traded market could artificially exacerbate the underlying stocks purchase and sales values. Just like shopping on the day after Thanksgiving we feel it is prudent to stay home that day so to speak and avoid being trampled by the masses.

If a stock falls below the $40 million dollar threshold during the year it will be sold and replaced by the next available candidate in position 101 on our master list.

The Index will select the biggest 100 Marijuana stocks so that as the group grows the Index grows. There will likely be a point in time where inclusion in the Top 100 is above $40 million and we look forward to that day. If the market shrinks there is a possibility that the 100 stocks temporarily smaller.

It is obvious now that the entire country (and world) for that matter have changed their opinion on the legalization of marijuana. Citizens have realized that the governments of the world have lied to them about the dangers of its use and suppressed evidence of its medicinal benefits because it was used as a political tool by governments to suppress its own people. Within the next decade Marijuana use will continue to grow and provide people with safer ways to relax than alcohol. It cannot be stress enough that no one has ever died from ingesting too much marijuana.

Ready to Talk?

Investors should carefully consider the investment objectives and risks as well as charges and expenses of an ETF before investing. This and other information are contained in the ETFs’ prospectuses. The prospectus should be read carefully before investing. An investment in an ETF is subject to risks and you can lose money on your investment. There can be no assurance that the ETFs will achieve their investment objectives. The ETFs’ portfolios are more volatile than broad market averages. The ETFs also have specific risks, which are described in the ETFs’ prospectuses.

Shares of the ETFs may be bought or sold throughout the day at their market price on the exchange on which they are listed. The market price of an ETF’s shares may be at, above or below the ETF’s net asset value (“NAV”) and will fluctuate with changes in the NAV as well as supply and demand in the market for the shares. The market price of ETF shares may differ significantly from their NAV during periods of market volatility. Shares of the ETFs may only be redeemed directly with the ETFs at NAV by Authorized Participants, in very large creation units. There can be no guarantee that an active trading market for ETF shares will develop or be maintained, or that their listing will continue or remain unchanged. Buying or selling ETF shares on an exchange may require the payment of brokerage commissions and frequent trading may incur brokerage costs that detract significantly from investment returns. Not FDIC Insured – No Bank Guarantee – May Lose Value

All statements made regarding companies, securities or other financial information on this site are strictly beliefs and points of view held by MJ PurePlay Index and/or PurePlay Capital, Inc. and are subject to change without notice. Certain information on this site was obtained from sources that MJ PurePlay Index and/or PurePlay Capital, Inc. believes to be reliable; however, MJ PurePlay Index and/or PurePlay Capital, Inc. does not guarantee the accuracy or completeness of any information obtained from any third party. The information on this site is for informational purposes only and should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. The information on this site is general in nature and should not be considered legal or tax advice. An investor should consult a financial professional, an attorney, or tax professional regarding the investor’s specific situation.

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