You’re reading this week’s edition of the New Cannabis Ventures weekly newsletter, which we have been publishing since October 2015. The newsletter includes unique insight to help our readers stay ahead of the curve as well as links to the week’s most important news. We no longer send these by email as we did in the past, but we post this and all of the newsletters on our website here.
Friends,
Cannabis stocks are mixed in 2026 so far after 8 full months. NCV no longer publishes the Global Cannabis Stock Index, and there is actually no index for the sector at this time. For years, the market tracked an index that went away. While there are fewer ETFs focused on the cannabis sector today than before the pandemic, the market tends to watch one closely, AdvisorShares Pure US Cannabis ETF (MSOS). We last wrote about MSOS in May in this newsletter and discussed how cannabis stocks going nowhere quickly. Since May 6th, MSOS has declined 6.5%.
MSOS Has Lagged
As we have discussed before, there is more to the cannabis sector than just American operators. One can look to non-U.S. companies as well as ancillary stocks as well, though there is no index that captures these. MSOS is quite large, with a market cap of $968 million. In 2026, it has rallied 4.5%, though this gain lags the S&P 500 as well as the Russell 2000:
Of course, 2025 was a strong year for MSOS. Looking at the action since the elections in 2024, when we elected Trump and when Florida voters failed to approve adult-use legalization, the relative underperformance has been even greater:
Again, there is more to cannabis stocks than just American producers and retailers, though there is no index that can capture this. Here is the performance of some large Canadian LPs since the elections in 2024:
The average has been boosted by two big winners, but the other five Canadian LPs are all down more than MSOS since November 5th, 2024. The average return of -0.3% far exceeds MSOS at -28.2%. In 2026, these seven Canadian LPs have underperformed MSOS, with six declining and one rising. The average change works out to be -15.7%.
MSOS Has Seen Share Redemptions
While MSOS is large and has seen its share-count increase this year slightly, the 196.965 million declined last week by 1.9%. There were three weekly declines in May from the all-time high set on April 24th at 208.22 million shares and then two more in July. From the peak, MSOS has seen its shares decline by 5.4%. Over the past year, shares outstanding have increased by 11.3% after increasing 50.5% in 2025 on the rescheduling news. The slowdown in expansion over the past few years is alarming:
MSOS Remains Highly Concentrated
One of the big challenges for MSOS has been diversification. Currently, the ETF holds just 18 positions, almost all of which are MSOs. Village Farms, which is 0.35% of MSOS, is not an MSO. 4 positions are less than 0.1% of the ETF, and 8 positions are in stocks that trade below $0.50. The top 3 positions, which include Trulieve (TCNNF), Curaleaf (CURLF) and Green Thumb Industries (GTBIF), total a stunning 76.9%. This does not correspond at all with their market share.
While we pointed this out long ago, and these stocks have rallied sharply from their lows, the big 3 MSOs are at risk of declining more if MSOS sees more redemptions. Here is how they have performed year-to-date:
Trulieve has outpaced MSOS the most, with Curaleaf close behind, while GTI has actually declined in 2026. Looking at the action since MSOS peaked in late April and comparing the action of the big 3 to MSOS since then, Trulieve has gained a lot, GTI has gained less than MSOS (with RYTHM, its partner that owns the brands, plunging by 23.6%) and Curaleaf has declined:
Things to Watch
Investors in cannabis stocks should be aware of the extreme concentration of MSOS in three stocks and should be cautious about how additional share-count declines might weigh upon the sector. They should also consider other types of cannabis stocks. Perhaps adult-use cannabis is moved to Schedule 3 like medical cannabis has been, which would wipe out 280E taxation and would be a good thing for MSOs, but perhaps it may remain Schedule 1.
Sincerely,
Alan
This week’s newsletter is sponsored by Paul E. Saperstein Co.
New York City Cannabis Dispensary
On September 24th, the debt holder of an adult-use retail dispensary in NYC known as The Daily Green at Seventh Avenue and West 48th Street is selling the assets online at 2:00 P.M, ET. Find out more about the Uniform Commercial Code Article 9 Sale of the pledged equity interest in the operating business of this dispensary.
Interested parties may contact Paul Cotto at 617-227-6553 or by email at pcotto@pesco.com.
New Cannabis Ventures did not publish any curated articles or exclusive news.
