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Elemental Advisors Launches PSYK ETF Focused on the Medical Psychedelics Industry
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Elemental Advisors Inc. has launched PSYK ETF (NYSE: PSYK), a thematic ETF focusing on psychedelic companies addressing medical conditions through legal pharmacological applications. This ETF is among the first of its kind listed in the U.S. and aims to provide exposure to a growing market projected to reach $10.75 billion by 2027. The Enhanced Consciousness Index, which PSYK tracks, includes companies in psychedelic research and development. The initiative is driven by increasing societal acceptance and promising research in psychedelic treatments for mental health issues.
Positive
Launch of PSYK ETF providing early access to the psychedelic drug market.
Market for psychedelic drugs projected to grow to $10.75 billion by 2027.
Growing societal and regulatory acceptance of psychedelics for medical use.
Negative
Psychedelic drugs remain classified as Schedule I/III under U.S. and Canadian law, limiting their use.
No guarantee of FDA approval for psychedelics, affecting potential growth of companies in the fund.
Fund operates with higher volatility due to non-diversified investment strategy.
SARASOTA, Fla.--(BUSINESS WIRE)--
Elemental Advisors Inc. (“Elemental Advisors”) is pleased to announce the launch of PSYK ETF (NYSE: PSYK), a thematic ETF that tracks the performance of the Enhanced Consciousness Index (the “Index”), which is principally comprised of companies involved in the research, development, production and/or use of psychedelics to address medical conditions in legal pharmacological applications under the applicable jurisdiction’s laws.
As one of the first U.S. listed psychedelic ETFs, PSYK provides investors with exposure to companies involved in the rapidly developing and potentially disruptive medicinal psychedelic drug market, which is forecast to reach $10.75 billion by 2027 according to a report from Research and Markets.
“Mental health issues, such as depression, PTSD and substance abuse, continue to be big societal problems, which have likely grown due to COVID-19 and the subsequent lockdown environment. While current treatments for these conditions can often be inadequate, there’s been some recent groundbreaking research that has shown psychedelic compounds to be a safe and effective treatment for people suffering from these illnesses,” said Tim Collins, a founder and President of Elemental Advisors. “For these reasons, coupled with the growing societal and regulatory acceptance of psychedelics, we believe that the psychedelic drug market is on the cusp of realizing its true potential and that the PSYK ETF can be an attractive option for savvy investors who are looking to gain access to this burgeoning segment on the ground floor.”
The Index will be principally comprised of companies that have, or are expected to have, a significant part of their business involved in the research, development, production and/or use of psychedelic-based pharmaceuticals and therapeutics. If fewer than 25 psychedelic companies qualify for inclusion in the Index, the Index will also include neurology biopharmaceutical companies, subject to a maximum of 35 total companies in the Index. Only stocks of developed market countries or ADRs of emerging markets countries that meet minimum capitalization and liquidity criteria are considered for inclusion in the Index.
About Elemental Advisors Inc.
Elemental Advisors was founded by individuals with decades of experience in capital markets to provide investors exposure to a diversified portfolio of companies engaged in cutting-edge medical research in drugs and therapies that may be disruptive to the medical industry. The first offering is an ETF focused on the emerging use of psychedelic compounds in the treatment of mental health issues (NYSE Ticker: PSYK). To learn more, please visit www.psyk-etf.com.
Disclosures
Investors should consider the investment objectives, risks, charges and expenses carefully before investing. For a prospectus or summary prospectus with this and other information about the Fund, visit www.psyk-etf.com/investor-materials. Read the prospectus carefully before investing.
An investment in the Fund involves risk, including possible loss of principal. There is no assurance that the Fund will achieve its investment objectives.
A new or smaller fund is subject to the risk that its performance may not represent how the fund is expected to or may perform in the long term. In addition, new funds have limited operating histories for investors to evaluate and new and smaller funds may not attract sufficient assets to achieve investment and trading efficiencies.
Associated Risks of Psychedelic Treatment Companies. In Canada, certain psychedelic drugs, including psilocybin, are classified as Schedule III drugs under the Controlled Drugs and Substances Act (“CDSA”) and as such, medical and recreational use is illegal under Canadian federal law. In the United States, most psychedelic drugs, including psilocybin, are classified as Schedule I drugs under the Controlled Substances Act (“CSA”) (21 U.S.C. § 811) and as such, medical and recreational use is illegal. There is no guarantee that psychedelic drugs or psychedelic inspired drugs will ever be approved for a therapeutic or medicinal use in either jurisdiction. In the United States, the U.S. Drug Enforcement Administration (“DEA”) scheduling determinations for removing a substance from Schedule I are dependent on FDA approval of a substance or a specific formulation of a substance for therapeutic or medicinal use. Unless and until psilocybin, psilocin, or other psychedelics-based products receive FDA approval, such products are prohibited from sale, which limits the growth opportunities for certain companies held by the Fund. Even if approved by the FDA, the manufacture, importation, exportation, domestic distribution, storage, sale, and legitimate use of such products will continue to be subject to a significant degree of regulation by the DEA. There can be no guarantees that such approvals or administrative actions will happen or be favorable for psychedelics companies. Such actions may be subject to lengthy delays and may require lengthy and expensive clinical trials. Additionally, therapies containing controlled substances may generate public controversy and carry reputational risk. Political and social pressures and adverse publicity could lead to delays in approval of, and increased expenses for, psychedelics companies and many future therapeutic candidates they may develop. All of these factors and others may prevent psychedelics companies from becoming profitable, which may materially affect the value of certain Fund investments.
The Fund is considered to be non-diversified, which means that it may invest more of its assets in the securities of a single issuer or a smaller number of issuers than if it were a diversified fund. As a result, the Fund may be more exposed to the risks associated with and developments affecting an individual issuer or a smaller number of issuers than a fund that invests more widely. This may increase the Fund’s volatility and cause the performance of a relatively smaller number of issuers to have a greater impact on the Fund’s performance.
The Fund is distributed by Quasar Distributors, LLC.
The PSYK ETF is a thematic exchange-traded fund launched by Elemental Advisors Inc. that focuses on companies involved in the research, development, and use of psychedelics for medical purposes.
What companies are included in the PSYK ETF?
The PSYK ETF tracks the Enhanced Consciousness Index, comprising companies involved in psychedelic-based pharmaceuticals and, if necessary, neurology biopharmaceuticals.
What is the market forecast for psychedelic drugs?
The psychedelic drug market is projected to reach $10.75 billion by 2027.
What risks are associated with investing in the PSYK ETF?
Investing in the PSYK ETF involves risks, including regulatory challenges, potential lack of FDA approvals for psychedelic drugs, and increased volatility due to its non-diversified nature.
How does the PSYK ETF contribute to mental health solutions?
The PSYK ETF aims to invest in companies developing psychedelic therapies that have shown promise in treating mental health issues such as depression and PTSD.
