As a company, you have other ETFs that maintain a focus on innovative and disruptive trends, such as robotics and automation, genomics, and future cars to name a few. What are some of the companies in these innovative themes? Do you view cannabis as a disruptive market?
Disruptive innovation is a key focus for us, but it would be a mistake to conclude that all such investments are high risk. Our innovative ETFs include mature companies that are investing in disruptive trends such as Amazon and AMD in our Innovation ETF (EDGE), Symantec and Check Point in our Cybersecurity ETF (CYBR), and Volkswagen and BMW in our Auto Innovation ETF (CARS). Some holdings are specific to their disruptive industries but we are using market cap and liquidity criteria to manage risk.
We view cannabis as disruptive in medical and recreational markets which is why we are confident it will experience growth. Ultimately, our mission is to provide investors with exposure to where the economy is going because we believe that’s where the returns are most promising.
Building off of that last question, this sector can change and fast! Would SEED change the frequency of its portfolio review if the situation warranted it?
Our portfolio review process is ongoing, which is one of the major advantages of active management compared to an index approach. The rapid changes in the cannabis sector is why we decided not to use an index for this product. Too much can change between the rebalancing dates of a passive index and we feel investors are better served by a manager who is always watching the market and can react to new developments.
Thank you for taking the time to speak to me about SEED and providing potential investors and current investors with some really good insight into your company’s thoughts and direction.
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