Debra BorchardtSubversive Capital ETF (CBOE: LGLZ) joins the list of cannabis ETFs that have closed. According to an SEC filing on March 20, Tidal Investments LLC, the fund’s investment adviser, and Subversive Capital Advisor LLC, the fund’s investment subadviser, recommended that the board of trustees of Tidal ETF Trust close and liquidate the fund.
“Unfortunately, marketing efforts have not proven effective, and the Fund’s net assets have not reached the level needed to offset operating costs,” the company said in the filing. “Tidal and Subversive Capital are of the view that the Fund cannot conduct its business and operations in an economically efficient manner over the long term. The Board determined, after considering the combined recommendation of Tidal and Subversive Capital, that it is in the best interests of the Fund and its shareholders to liquidate and terminate the Fund.”
The ETF will quit trading on the Cboe BZX Exchange and will be closed to purchase by investors as of the close of regular trading on March 28. The fund will not accept purchase orders after this date.
According to the ETF’s fact sheet, the fund had roughly half a million dollars in assets under management and had a year-to-date performance of 20.6%.
The filing noted that shareholders may sell their holdings before the closing date. However, from March 28 through April 5, shareholders may be able to sell their shares only to certain broker-dealers. There is no assurance that there will be a market for the fund’s shares during this period.
The fund will be liquidating its holdings and once distributions are complete, the fund will terminate.
The ETF’s top five holdings are:
- GREEN THUMB INDS INC SWAP, 37.88%
- CURALEAF HLDGS INC SWAP, 21.96%
- First American Government Obligations Fund 12/01/2, 17.81%
- VERANO HLDGS CORP SWAP, 14.81%
- CRESCO LABS INC SWAP, 8.28%
Numerous cannabis ETFs have closed in the past year as valuations slumped and burned buyers refused to step back in and add to their pain.
