The index, which fell 29.2% in 2021 to end at 194.95, has declined 49.4% over the past year:
It remains substantially below the all-time closing high of 1314.33 in September 2018, just ahead of Canadian adult-use legalization. In March 2020, it posted a new multi-year closing low of 196.10, a level that had not been seen since late 2016, and it closed 10.0% below that level this month:
The Canadian Cannabis LP Index, which is rebalanced monthly, included 24 qualifying publicly traded licensed producers that traded in Canada at the end of October, with equal weighting for each stock. Each of the members was also included in a sub-index, with 4 in the Canadian Cannabis LP Tier 1 Index, 8 in the Canadian Cannabis LP Tier 2 Index and 12 in the Canadian Cannabis LP Tier 3 Index during the month. At the end of November 2021, we raised the minimum for Tier 1 from C$25 million to C$30 million, for Tier 2 from C$5 million to C$7.5 million and for Tier 3 to C$2.5 million from zero. This was the first change since June 2020, when we required companies to have a price of at least C$0.20 unless they are generating at least C$2.5 million quarterly from their cannabis production operation. Previously, we required revenue in excess of C$1 million for stocks trading below C$0.20. There are currently more than two dozen publicly traded LPs that fail to qualify.
This group included Aleafia Health (TSX: AH) (OTC: ALEAF), Auxly (TSX: XLY) (OTC: CBWTF), Cronos Group (TSX: CRON) (NASDAQ: CRON), Decibel Cannabis (TSXV: DB) (OTC: DBCCF), Entourage Health (TSXV: ENTG) (OTC: ETRGF), Indiva (TSXV: NDVA) (OTC: NDVAF) Organigram (TSX: OGI) (NASDAQ: OGI) and Valens Company (TSX: VLNS) (NASDAQ: VLNS).
For February, the overall index will continue to have 24 constituents. Organigram will now be included in Tier 1 rather than Tier 2.
In the next monthly review, we will summarize the performance for February and discuss any additions or deletions. Be sure to bookmark the pages to stay current on LP stock price movements within the day or from day-to-day.