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MARIJUANA MISMATCH


Alternative Harvest ETF (MJ

The price of the ETFMG – Alternative Harvest ETF (MJ) 38.97 NYSE ARCA – Nasdaq Real Time Price – Currency EFT USD – represents net assets value of $457 million, and a NAV (Net Asset Value of $33.36, indicates premium of 17%. Usually, investors pay little attention to intraday asset values, but it can express that something is amiss. When the ETF’s – Exchange Traded Funds – share price is out of whack with the real value of its assets – as happened last week with the ETFMG Alternative Harvest ETF – it is an indication that the fund isn’t functioning as it should. When the metric breaks down, demand for the ETF shares can outstrip supply, inflating the price above the value of the fund’s holdings. Conversely, when the EFT price drops below the value of its assets, it may be a sign that investors are having trouble getting out of a fund as fast as they wish. Thus, a liquidity crisis with the market markets is evident. Those disparities act as a warning sign. Such premiums can evaporate in seconds, leaving investors with sudden losses; and discounts may be a sign investor can get out only at a reduced price.

As for Alternative Harvest ETF (MJ), a disconnect (premium) is evident can be a warning sign or the underlying assets are trading at a bargain. Based on our SPM algorithm, MJ is trading above its real worth with likely support at $31.77, the price on June 6, 2018.


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