This is an actively managed ETF that invests in companies across the global cannabis value chain. Beyond cultivation and processing companies, it holds a broad mix that includes cannabis-related real estate REITs and technology and distribution platforms, giving exposure to the growth of the theme as a whole.

It suits thematic investors who are betting on the long-term growth of the cannabis industry and the possibility of regulatory easing, and who can tolerate high volatility.

It is an ETF run by Amplify using an active (actively managed) approach.

This is an active strategy in which the management team selects and holds stocks across the cannabis industry, including cultivation, distribution, biotech, and real estate. Rather than mechanically replicating an index, it actively adjusts portfolio weights according to the regulatory environment and the progress of businesses.

• Active stock selection based on industry expertise
• Value chain diversification spanning cultivation, distribution, and REITs

Assets under management (AUM) are $67.1M, and the expense ratio is 0.76% per year.

Unlike passive cannabis products, weights are adjusted at the discretion of the management team, so the portfolio composition can change over time.

The fund moves in line with cannabis-related stocks overall and tends to react sensitively to federal regulatory discussions and expectations of legalization. Policy hopes and disappointments alternate, producing repeated periods of high volatility.

As a thematic product, it sees large swings in fund flows depending on regulatory news and industry sentiment. Interest tends to surge when legalization expectations are in focus, and money can flow out once momentum fades.

Active diversification across the industry is its strength, but regulatory uncertainty and high volatility are the key risk factors.

The comparison targets in the table, GRID, BOTZ, and TAN, are thematic ETFs in other sectors, aimed at power grids, robotics, and solar energy respectively. Their industries differ from cannabis, but they share the character of high-volatility thematic products that concentrate on a specific industry. For direct substitutes within the same cannabis theme, options include MSOS, which concentrates on US-listed cannabis companies, MJ, which Amplify also co-manages, and YOLO, which invests in global cannabis stocks. For more aggressive exposure there is also the leveraged product MSOX, but the risk expands significantly.

Here are the points to review before investing in CNBS. Because it is an actively managed thematic ETF, it is advisable to thoroughly check the fee burden, the regulatory environment, and the level of volatility driven by thematic sentiment before investing.

The cannabis industry's business environment can change abruptly depending on the direction of regulation, so policy risk carries significant weight. Many holdings are small caps, so the fund is also heavily exposed to liquidity and earnings fluctuations.

It suits thematic investing that bets on the long-term growth of the cannabis industry and the possibility of regulatory easing. If you can tolerate high volatility, it can be considered as a means of active diversification, and if you want concentrated exposure to the US, it is also worth comparing MSOS.