The Board of Trustees of the AXS Cannabis ETF (THCX) has approved a plan of liquidation, signaling the closure of the fund. The decision comes amidst fluctuating trends within the cannabis industry and will impact investors and stakeholders in various ways.
The plan greenlights the termination, liquidation, and dissolution of the AXS Cannabis ETF. Effective February 21, 2024, the fund will cease creating and redeeming creation units, coinciding with its last day of trading on the NYSE Arca. Shareholders will have until this date to make decisions regarding their holdings.
Subsequently, on or about February 28, 2024, the fund will undergo complete liquidation, distributing proceeds to shareholders of record as of the liquidation date. Shareholders are advised to consult their tax advisors regarding potential capital gains or losses resulting from the liquidation.
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In anticipation of the fund’s closure, AXS Investments LLC, the fund’s advisor, may adjust its management approach to facilitate an orderly liquidation process. The firm said this may involve raising cash or reallocating investments into other highly liquid assets. Consequently, the fund may deviate from its stated investment strategies, potentially affecting its ability to achieve its investment objectives.
The closure of the AXS Cannabis ETF, an exchange-traded fund that provides investors exposure to the legal cannabis market, reflects broader shifts within the industry. The fund, which seeks to track the performance of the AXS Cannabis Index, intended to play a role in offering investors a diversified vehicle for participating in the growth of the cannabis sector.
Commenting on the impending closure, Cannaseurs on X highlighted the anticipated sell pressure on Canadian cannabis names and auxiliary companies around February 28, coinciding with the liquidation of assets by the THCX ETF. Notably, the absence of Multi-State Operators (MSOs) in the fund’s holdings has been noted, providing reassurance to #MSOgang supporters.
Information for this briefing was found via the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
