It's been difficult for Americans to legally invest in the world's booming marijuana business but a new online fund will let you do it at the click of a mouse.
Canadians are bringing a new meaning to the term "investor high," with the world's first marijuana-focused exchange-traded fund opening on the Toronto Stock Exchange.
The Horizons Medical Marijuana Life Sciences exchange-traded fund is comprised of 14 stocks, allowing investors to diversify their risk. The fund uses the North American Medical Marijuana Index as a benchmark.
Medical marijuana has been legal in Canada since 2001 and the country could be poised to legalize recreational use next year, making the investment opportunity particularly alluring for cannabis connoisseurs.
Related: Denver Voters Approve Marijuana in Bars, But There's a Catch
The North American medical marijuana market generated $6.7 billion in revenue last year, 30 percent more than the previous year, according to a summary on the fund website.
Fund managers noted they won't include exposure to companies in the United States, where marijuana is illegal under federal law and legal for medical use in only a handful of states. Most banks will not deal with pot firms who must instead rely entirely on the transfers of large sums of cash to conduct business. This normally puts them several steps out of reach from the average average investor.
That doesn't mean American investors will necessarily be turned away from getting on board with the investment opportunity. Americans can buy buy ETFs on the Toronto Stock Exchange, as long as their brokerage platform allows it.
Most brokerages will first require the American or any other foreign buyer to first purchase Canadian Dollars to use to execute the trade.
Vanguard, a low-cost online brokerage firm, said that for for American investors to get on board, "the ETF has to have a US Pink Sheet equivalent registered in the US and be traded in the Over-the-Counter (OTC) Market."
"We do not hold securities in foreign currencies; therefore, we need the US-registered security in order to settle the trade in USD," a representative told NBC News.
However, TD Ameritrade "does not offer trading on non-US exchanges for exchange traded products," so you should check with your broker first before getting too excited about this hot new investment.
The ETF's annual management fee is 0.70% of its value and since it's new, its operating expenses and trading costs are not yet available.
