The AdvisorShares Pure Cannabis ETF (YOLO) debuted on Friday. It will be the second marijuana ETF trading in the U.S. after the ETFMG Alternative Harvest ETF (MJ). How do the two compare? Active vs. Passive Perhaps the biggest difference is that MJ is a passively-managed index fund where YOLO will be actively-managed. MJ follows the Prime Alternative Harvest Index, which invests in a mix of companies that are engaged in the legal cultivation of cannabis, the legal creation of cannabinoid-related products. YOLO will invest and trade in companies that derive at least half of their revenue from the marijuana and hemp industry. Dedicated Cannabis Industry Exposure If you want more pure cannabis industry exposure, YOLO is your choice. It only invests in companies whose primary business is marijuana. These stocks tend to focus on the healthcare, biotech and agriculture sectors but could also invest in securities such as REITs that target cannabis production facilities. MJ casts a wider net. It can invest in companies that simply have exposure to the industry. Therefore, MJ can include companies that develop cannabis-related products, such as cigarettes, or invest in fertilizer companies that assist in the cultivation of marijuana and hemp crops. MJ counts Altria (MO), Philip Morris (PM) and Scott's Miracle-Gro (SMG) among its holdings. YOLO avoids these types of names. Fees MJ originally debuted with an expense ratio of 0.75%. The ETF industry is fee-driven so it's not surprising that YOLO was introduced with an expense ratio of 0.74%. Asset flows tend to migrate to cheaper products but it'll be interesting to see if such a small difference in such a specialized space will make a difference. Conclusion MJ is more than a year old and has about $1.2 billion in assets. Second arrivers to the space generally have trouble gaining traction (the Global X Robotics & Artificial Intelligence Thematic ETF (BOTZ) being a notable exception). Both are fairly concentrated. MJ has 35 holdings. YOLO has just 20. Both own popular names, such as Tilray (TLRY), Canopy Growth (CGC) and Aurora Cannabis (ACB). Cronos (CRON) is notably absent from YOLO. Which should you own? MJ is bigger and more liquid but YOLO offers more pure exposure to the cannabis industry. YOLO is too small to trade right now but I like the way it's constructed, the fact that it's actively managed and stays away from the ancillary companies that have just slight exposure to marijuana. Once it grows larger, I'd tend to lean towards YOLO.