The new index will initially serve as an indicator of changes in the sector and a benchmark
The Tel Aviv Stock Exchange (TASE: TASE) today announced the launch of a new index that will include stocks of companies in the cannabis sub-sector, as part of the biomedical sector. It is expected to include 9 stocks with a market capitalization of 1,7 billion Israeli shekel.
Israel's medical cannabis industry has evolved in recent years and, although not yet mature, it has grown in importance in the capital market. As a result, on November 1, 2020, TASE launched a new cannabis sub-sector. The cannabis sub-sector includes companies that are primarily engaged in the research, cultivation, sale or production and marketing of medical cannabis products.
The majority of stocks in the cannabis sub-sector are included in the TA-Growth index and only one is included in the TA-SME60 index. As the market capitalization of the 9 cannabis companies included in the universe of Tamar equity indices is relatively small, the index cannot currently be considered as a core asset for ETFs and financial tracking products. Nevertheless, as it is useful, among other things, to indicate the trend changes of the market capitalization of its companies and as a benchmark for active mutual funds that offer exposure to this emerging and growing sector, the TASE decided to launch the index.
The TA-Cannabis Index will include the stocks of companies that TASE has ranked in the cannabis subsector, with a weight cap of 15% for the stocks included in the index.