In a Form 13F-HR filed with the U.S. Securities and Exchange Commission on October 5th, Toronto-based Barometer Capital Management Inc. disclosed that it sold off all of its ownership in Canadian cannabis producer Canopy Growth Corp. (NYSE:CGC) (TSX:WEED).
Although Barometer Capital’s position in Canopy only represented less than 0.5% of its portfolio, the position was still a sizable 184,600 shares. Based on Monday, October 8th’s close price of $50.41 USD per share of CGC on the NYSE, that position would be worth $9,305,686 USD or roughly $12,065,287 CAD.
Barometer Bullish on CannTrust?
In a video interview after the close on September 13th, 2018, Barometer Capital Management’s Vice President and Head of Trading, Diana Avigdor, said she also likes CannTrust Holdings Inc. (TSX:TRST) (OTC:CNTTF), but not because of value. Avigdor noted that “cannabis stocks mainly live in portfolios that have a higher risk tolerance.”
According to the firm’s website, Barometer Capital has approximately $2 billion in assets under management broken down into a client mix of roughly 40% high-net-worth private clients, 40% Investment Advisors and 20% institutional investors.
The high-net-worth portion of Barometer Capital’s assets comes from over 400 wealthy families across the United States and Canada. Although Barometer Capital Management was established by its founding partners in 2006, they had already been working together since back in 2001.
Wealth Families Investing in Weed
Presumably, the firm’s appetite for cannabis investments come from some of their high-net-worth clients. Since the beginning of the green rush, family offices and wealthy families have been making early moves in the industry.
Established back in 2014, Green Thumb Industries Inc. (CSE:GTII) (OTC:GTBIF) is a U.S. cannabis company with licenses in eight highly-regulated states, and also the brainchild of Ben Kovler, heir of the Jim Beam fortune.
More recently, we’ve seen William Wrigley, Jr. II from the Wrigley chewing gum fortune lead a $65 million Series C equity financing round in Surterra Wellness, which has cannabis licenses in both Texas and Florida.
We’ll continue to monitor 13F filings to see what institutional investors are up to. In the meantime, be sure to subscribe to Canadian Licensed Producer Updates here and Cannabis Stock Updates here so you never miss an important update. For updates on Canopy specifically, be sure to subscribe to Canopy Growth Corp. Updates here.
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