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00:00THROUGH GOOD MARKETS AND BAD, GOOD ECONOMIES AND BAD. THEY CAN HAVE A LOW CORRELATION TO THE OVERALL MARKET. AGAIN, PEOPLE EASILY UNDERSTAND THAT THESE AREAS CAN PERFORM WELL THROUGH THICK AND THIN. JULIE: YOU ' RE TALKING ABOUT TWO QUITE MATURE MARKETS WHEN YOU TALK ABOUT ALCOHOL AND TOBACCO. MARIJUANA IS A DIFFERENT THING ENTIRELY. RIGHT NOW THE HOLDINGS ARE ABOUT HALF ALCOHOL, A THIRD TOBACCO, AND ABOUT 1/5 MARIJUANA MORE OR LESS. HOW DO YOU WORK THE INTERPLAY BETWEEN THESE 23 AREAS WHERE YOU DO HAVE AN AREA THAT IS SO NASCENT VERSUS THESE TWO MORE MATURE MARKETS? DAN: WE REALLY LIKED THE WAY THAT THESE CAN WORK TOGETHER AND INTERACTED. WE THINK OF THE FUTURE THERE WILL BE A GREAT DEAL OF OVERLAP BETWEEN THESE INDUSTRIES. THE TOBACCO AND ALCOHOL INDUSTRIES WHILE VERY MATURE HAVE A GREAT RECORD OF NAVIGATING HEAVILY REGULATED INDUSTRIES. AND WORKING WELL WITH THE FEDERAL GOVERNMENT BECAUSE OF THAT. CANNABIS, MARIJUANA, IT ' S NOT EVEN AN INDUSTRY. IT CAN BE ALL SORTS OF THINGS. FOR US, IT ' S REALLY MOSTLY PHARMACEUTICAL AND BIOTECH, BECAUSE VERY IMPORTANTLY, WE ARE ONLY INVESTING IN COMPANIES THAT ARE LEGAL AT A FEDERAL LEVEL. IN THE UNITED STATES. NONE OF THESE CANADIANS AND CERTAINLY NO OTC AND PINK SHEETS. THERE ' S A LOT OF THOSE OUT THERE. WE THINK THESE INDUSTRIES WORKED VERY WELL TOGETHER -- CANNABIS, MARIJUANA MIGHT BE AGGRESSIVE GROWTH. ALCOHOL AND TOBACCO MY OFFSET THAT, BUT WE WILL SEE OVERLAP BETWEEN THESE TWO INDUSTRIES, MAYBE MERGERS AND ACQUISITIONS OR JOINT VENTURES. JULIE: WE HAVE SEEN THE LIKES OF CONSTELLATION BRANDS MAKE INVESTMENTS IN THE MARIJUANA INDUSTRY. HOW QUICKLY DO YOU THINK THAT IS GOING TO RAMP UP? UNTIL NOW, IT HAS BEEN RELATIVELY SMALL. DAN: IT IS RELATIVELY SMALL AND MOST OF THAT IS BECAUSE OF FEDERAL REGULATION. I ' M NOT GOING TO MAKE ANY PREDICTIONS ABOUT THAT. I WILL SAY THAT THERE IS A LARGE SOCIAL SURGE OF PEOPLE WANTING LEGALIZATION. AND THESE PHARMACEUTICAL AND BIOTECH COMPANIES ARE MAKING SOME GREAT BREAKTHROUGHS IN MEDICATIONS, DRUGS THAT CAN BE CAN HAVE ANNOYED OR -- CANNA BANOID OR CANNABIS-BASE WED SO WE DO THINK WE WILL SEE IT IN THE FUTURE. THE LEVEL FOR FEDERAL APPROVAL FOR USE -- I MAKE NO

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AdvisorShares MD Sees Pot, Alcohol Companies Combining

Dan Ahrens, AdvisorShares Investments managing director, says he expects increased M&A activity between marijuana, tobacco and alcohol companies. He speaks with Bloomberg's Julie Hyman on "Bloomberg ETF IQ." (Source: Bloomberg)

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