Dan Ahrens on Pot Stock Outlook & MSOS ETF After Reclassification
Why It Matters
Federal rescheduling could unlock banking, exchange listings, and tax relief for U.S. cannabis firms, fundamentally reshaping the sector and driving new investment opportunities.
Key Takeaways
- •DEA rescheduled cannabis to Schedule III, unlocking federal reforms.
- •Final rescheduling hearing set for last week of June 2024.
- •Nasdaq and NYSE ready to list U.S. cannabis companies post‑reform.
- •280E tax penalty removal could boost profitability of cannabis firms.
- •AdvisorShares recommends cannabis as a satellite, not core, portfolio position.
Summary
Dan Ahrens, managing director at AdvisorShares, discussed the outlook for the MSOS cannabis ETF in light of the DEA’s recent decision to move cannabis from Schedule I to Schedule III, a regulatory shift he called the biggest development for U.S. cannabis investing.
He explained that a final rescheduling hearing is slated for the last week of June, with the acting attorney general selecting a judge and the DEA head already signaling approval. Nasdaq and the NYSE are in talks to list U.S. cannabis companies, while banks anticipate lifting the 280E tax penalty and other banking restrictions that have kept many firms trading OTC.
Ahrens highlighted Curaleaf’s 385% one‑year gain as a standout example, noting that investors still carry “PTSD” from the sector’s volatility and past losses. He urged treating cannabis as a satellite allocation rather than a core holding, given the sector’s unpredictable political and regulatory environment.
If the summer reforms materialize, the sector could see a surge in institutional capital, broader exchange listings, and improved margins, but investors should remain cautious and limit exposure to the still‑volatile market.
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