How does the PSDN ETF work?

PSDN ETF: Overview

The Poseidon Cannabis ETF (PSDN) is an actively managed exchange-traded fund (ETF) with a unique focus on the emerging cannabis and hemp industry. Managed by Poseidon Investment Management, LLC, PSDN seeks to achieve its investment objective by investing primarily in securities of companies deeply involved in the marijuana and hemp business or those providing related services, products, or technology. This ETF stands out by targeting businesses deriving at least 50% of their net revenue from this rapidly growing sector.

PSDN ETF Underlying and Exposure: What Does It Track and How?

PSDN primarily invests in exchange-listed equity securities, including common and preferred stocks, of mid-sized, small-cap, and micro-cap companies in the United States and abroad. Additionally, the fund utilizes derivatives that replicate the economic characteristics of these securities. One of the notable features of PSDN is its use of total return swaps, which allows the fund to dynamically adjust its exposure to marijuana and hemp companies, potentially providing better risk-adjusted returns over the long term. The fund may also invest up to 20% of its assets in companies with potential revenues from cannabis-related businesses or those registered with the DEA for legitimate research and development activities related to cannabis or cannabinoid products.

PSDN overlap How does work the PSDN ETF?

PSDN ETF: Benefits of Investing

Investing in PSDN offers unique exposure to the burgeoning cannabis and hemp industry, which is experiencing rapid growth and evolving legislative changes. With a focus on companies engaged in various sectors, including pharmaceuticals, biotechnology, real estate, and finance, PSDN provides a diversified approach to capitalizing on the cannabis market. The fund's active management strategy seeks competitive advantages in chosen markets, making it an attractive option for investors seeking potential growth opportunities in this sector.

PSDN ETF: Considerations Before Investing

Before investing in the PSDN ETF, potential investors should consider several factors. This fund concentrates a significant portion of its investments in the Pharmaceuticals, Biotechnology & Life Sciences Industry Group within the Health Care Sector, which may introduce sector-specific risks. Moreover, as an actively managed ETF, PSDN's performance may be influenced by the fund manager's selection of securities and market timing decisions. Additionally, the fund's use of derivatives and leverage may increase its exposure to market volatility.

Conclusion
In conclusion, the Poseidon Cannabis ETF (PSDN) offers a distinctive investment opportunity in the rapidly evolving cannabis and hemp industry. With its focus on companies deriving substantial revenue from this sector and its dynamic approach to market exposure, PSDN provides investors with a unique way to potentially benefit from the growth of cannabis-related public corporations. However, it's crucial for investors to carefully consider their risk tolerance and investment objectives before adding this ETF to their portfolio.

Disclaimer: This article is for informational purposes only and does not provide investment advisory services. Before making any investment decisions, consult with a financial advisor and perform your own research to assess whether PSDN or any other investment is suitable for your financial goals and risk tolerance.

PSDN ETF issuer
PSDN ETF official page

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