AdvisorShares Issues Statement on Executive Order to Reclassify Cannabis

Rhea-AI Summary

AdvisorShares (MSOS) issued a statement on Dec 18, 2025 responding to a Presidential Executive Order directing federal agencies to advance the reclassification (rescheduling) of cannabis under the Controlled Substances Act.

The firm called the order a coordinated federal signal toward policy reform, saying rescheduling has moved from speculation to sustained engagement and may affect taxation, research access and capital formation for U.S. cannabis companies. AdvisorShares highlighted the potential impact on more than 400,000 American cannabis workers and reiterated that MSOS is an actively managed ETF focused on U.S. cannabis companies and is the largest cannabis ETF.

Positive

• Executive Order directs federal agencies to advance rescheduling (Dec 18, 2025)
• AdvisorShares cites potential to reshape taxation, research access, capital formation
• Statement notes impact for > 400,000 American cannabis workers
• MSOS identified as the largest cannabis ETF with U.S. focus

Negative

• Statement acknowledges the action does not resolve all regulatory hurdles
• Fund remains subject to volatility and possible loss of principal

Key Figures

Cannabis workers impacted 400,000 workers Workers referenced as potentially affected by rescheduling

AlphaNooner time 12:00 pm ET Daily live discussion time mentioned for AlphaNooner

Fund phone number 1-877-843-3831 Contact number for additional fund information

Schedule classification Schedule I Current cannabis classification under the Controlled Substances Act

Market Reality Check

$4.88 Last Close

Volume Volume 86,447,856 is 5.55x the 20-day average of 15,576,591, signaling unusually heavy trading ahead of this policy statement. high

Technical Price at $4.89 is trading above the 200-day MA of $3.49, reflecting a recovery from prior lows while still 30.93% below the 52-week high.

Market Pulse Summary

This announcement highlighted an Executive Order directing agencies to advance cannabis reclassification under the Controlled Substances Act, framed as a pivotal step for more than 400,000 cannabis workers and U.S. operators. It emphasized potential impacts on taxation, research and capital formation, while reiterating that significant regulatory and operational risks remain for cannabis-related companies. Investors may monitor future federal actions, implementation details and evolving risk disclosures to gauge how policy shifts translate into sector fundamentals.

Key Terms

exchange-traded funds financial

"AdvisorShares, a leading sponsor of actively managed exchange-traded funds (ETFs)"

An exchange-traded fund is an investment product that bundles many stocks, bonds, or other assets into a single package that trades on a stock exchange like an individual share; think of it as a ready-made basket you can buy or sell throughout the trading day. For investors it matters because ETFs provide easy access to broad exposure, typically lower costs and built-in diversification, and the ability to adjust positions quickly without buying each asset separately.

controlled substances act regulatory

"reclassification of cannabis under the Controlled Substances Act"

A federal law that creates the rules for which drugs and chemicals are legal, how they are classified by risk, and what licenses and controls are required for manufacture, distribution, research, and medical use. For investors, these classifications act like traffic signals — they determine how easy or hard it is for companies to develop, sell, or research certain medications and can sharply affect a company’s regulatory cost, market access, and legal risk.

net asset value financial

"Shares are bought and sold at market price not net asset value (NAV)"

Net asset value is the total value of an investment fund's assets minus any liabilities, divided by the number of shares or units outstanding. It represents the per-share worth of the fund, similar to how the value of a house is determined by its total worth after debts are subtracted. Investors use it to gauge the true value of their holdings and to compare different investment options.

bid/ask spread financial

"Market price returns are based on the midpoint of the bid/ask spread at 4:00 pm"

The bid/ask spread is the difference between the highest price a buyer is willing to pay (the bid) and the lowest price a seller will accept (the ask) for a share or other security at a given moment. It matters to investors because a wider spread increases the implicit cost of trading and usually signals it’s harder or more expensive to buy or sell quickly, like paying a larger markup when exchanging money at an airport; a narrow spread means cheaper, smoother trading and better price accuracy.

intellectual property rights technical

"risks include increased government regulation, the use and enforcement of intellectual property rights"

Legal protections that give a company exclusive control over creations like inventions, brand names, designs, formulas, software and creative works, similar to owning the lock and key to a recipe or product design. For investors, these rights matter because they can create durable revenue streams, reduce competition and justify higher company value, while weak or contested rights increase the risk of lost sales and costly legal disputes.

product liability lawsuits technical

"risks include ... product liability lawsuits, and the risk that research and development"

Product liability lawsuits are legal claims brought by people who say they were harmed by a product, arguing the item was defective, poorly labeled, or lacked proper warnings. For investors this matters because such cases can lead to large legal settlements, higher insurance or recall costs, and damage to a company’s reputation and sales — similar to a sudden repair bill and bad reviews that can shrink future earnings.

AI-generated analysis. Not financial advice.

MSOS portfolio manager calls executive action a pivotal moment for cannabis policy

BETHESDA, Md., Dec. 18, 2025 /PRNewswire/ -- AdvisorShares, a leading sponsor of actively managed exchange-traded funds (ETFs), today issued the following statement in response to the Executive Order by President Donald J. Trump directing federal agencies to advance the reclassification of cannabis under the Controlled Substances Act.

"This is the clearest and most coordinated federal signal we've ever seen on cannabis policy," said Dan Ahrens, Managing Director at AdvisorShares and portfolio manager of the AdvisorShares Pure US Cannabis ETF (MSOS). "What makes this moment different is that rescheduling has moved from speculation to sustained engagement at the highest levels of government. Medical adoption, economic reality and direct industry dialogue are now being formally recognized in federal policy."

Ahrens added, "While this action does not resolve every regulatory hurdle, it meaningfully advances the conversation around potential further federal reforms and represents a significant step forward for more than 400,000 American cannabis workers. A move away from Schedule I has the potential to reshape taxation, research access and capital formation for U.S. cannabis companies, which is why this landmark announcement represents an important step for both operators and investors."

The AdvisorShares Pure US Cannabis ETF (Ticker: MSOS) is an actively managed ETF focused primarily on U.S. cannabis companies, including multi-state operators. MSOS is the largest cannabis ETF and was the first ETF to offer dedicated exposure to U.S. cannabis companies. AdvisorShares also offers the AdvisorShares Pure Cannabis ETF (Ticker: YOLO), an actively managed global cannabis investment strategy that was the first U.S.-listed ETF with dedicated cannabis exposure. Both funds are managed by Mr. Ahrens.

For more information, please visit AdvisorShares.com.

About AdvisorShares

AdvisorShares is a leading provider of actively managed ETFs, providing investment solutions across equities, alternatives and thematic strategies. Financial professionals and investors seeking more information may call 1-877-843-3831 or visit advisorshares.com.

Each weekday at 12:00 pm ET, join us live for the AdvisorShares "AlphaNooner" (#alphanooner), where we discuss timely topics. Past discussions have included swaps, portfolio risk, hedged equity, cannabis, bonds, interest rates and more. Live questions are welcome and you can watch and engage on the AlphaNooner via X, LinkedIn, Facebook and YouTube.

Before investing you should carefully consider the Fund's investment objectives, risks, charges and expenses. This and other information is in the prospectus, a copy of which may be obtained by visiting the Fund's website at www.AdvisorShares.com. Please read the prospectus carefully before you invest. Foreside Fund Services, LLC, distributor.

An investment in the Funds is subject to risk, including the possible loss of principal amount invested. The risks associated with each Fund include the risks associated with the underlying ETFs, which can result in higher volatility, and are detailed in each Fund's prospectus and on each Fund's webpage.

The Fund is subject to a number of risks that may affect the value of its shares. This section provides additional information about the Fund's principal risks. The degree to which a risk applies to the Fund varies according to its investment allocation. Each investor should review the complete description of the principal risks before investing in the Fund. As with investing in other securities whose prices increase and decrease in market value, you may lose money by investing in the Fund.

Cannabis-Related Company Risk – Cannabis-related companies are subject to various laws and regulations that may differ at the state/local and federal level. These laws and regulations may (i) significantly affect a cannabis-related company's ability to secure financing, (ii) impact the market for marijuana industry sales and services, and (iii) set limitations on marijuana use, production, transportation, and storage. Cannabis-related companies may also be required to secure permits and authorizations from government agencies to cultivate or research marijuana. In addition, cannabis-related companies are subject to the risks associated with the greater agricultural industry, including changes to or trends that affect commodity prices, labor costs, weather conditions, and laws and regulations related to environmental protection, health and safety. Cannabis-related companies may also be subject to risks associated with the biotechnology and pharmaceutical industries. These risks include increased government regulation, the use and enforcement of intellectual property rights and patents, technological change and obsolescence, product liability lawsuits, and the risk that research and development may not necessarily lead to commercially successful products. Shares are bought and sold at market price not net asset value (NAV) and are not individually redeemed from the Fund. Market price returns are based on the midpoint of the bid/ask spread at 4:00 pm Eastern Time (when NAV is normally determined) and do not represent the return you would receive if you traded at other times.

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SOURCE AdvisorShares

FAQ

What did AdvisorShares say about the Dec 18, 2025 Executive Order on cannabis and MSOS?

AdvisorShares said the order is a coordinated federal signal advancing rescheduling and could affect taxation, research access and capital formation.

How could the Executive Order affect MSOS shareholders (AdvisorShares Pure US Cannabis ETF)?

AdvisorShares said rescheduling may improve research access and capital formation for U.S. cannabis companies, potentially affecting the fund's investment environment.

Does the Dec 18, 2025 Executive Order immediately legalize cannabis at the federal level for MSOS holdings?

No; AdvisorShares noted the action advances the process but does not resolve all regulatory hurdles or immediately change federal law.

How many U.S. cannabis workers did AdvisorShares reference in its Dec 18, 2025 statement?

The statement referenced more than 400,000 American cannabis workers.

What is MSOS's investment focus described in the statement dated Dec 18, 2025?

MSOS is an actively managed ETF focused primarily on U.S. cannabis companies, including multi-state operators.