How do you invest in weed?
Investing in CBD and CBD edibles is a very new and developing industry. It allows the common consumer to ride the wave and take their money and put it in a growing field that will perform well into the future. THC and CBD edibles and all types of cannabis related companies are here to stay and are continuing to grow.
Have there been growing pains for different states? Yes, there absolutely have been many hiccups and crashes, but that is to be expected. The legal cannabis and hemp industry has only been around for a few years. Most state regulators are having difficulty with exactly how to introduce it to their constituents. Understandably so, since at a federal level marijuana products, cannabis with over 3% THC, is still federally illegal.
This also causes issues with financing. How do traditional banks, a national entity regulated by federal agencies, finance the product of a product that is a schedule 1 drug? Luckily CBD edibles can come from legal hemp avoiding this product. But investing in CBD goes hand in hand with investing in all cannabis types. Here are a few ways you could invest in THC and CBD edibles and any cannabis product or process:
• Support your local grower financially, find a farmer and buy the seeds as starter
• Invest in a dispensary, find a local dispensary and partner on another store
• Start your own small batch CBD edibles company
• Buy into a cannabis partnership
• Trade weed stocks, by far the most common and easiest
Are these stocks performing well?
So, regardless on where you live or what kind of capital you have access to, anyone can trade stock. It is as simple as opening a brokerage account or even just downloading the Robinhood app.
However, be aware that a generalized brokerage account won’t be good enough if you want the full range of weed stocks. You will need one that allows you to trade over the counter stocks that aren’t actively traded on an exchange. These stocks are labeled as “over the counter bulletin board” or OTCBB.
How has the cannabis market faired since it opened up a year or two ago on the markets? Well, over the past 12 months, as of January 2020, the S&P 500 has seen a 26.4% gain. The industry group ETFMG Alternative Harvest ETF (MJ) has substantially underperformed as comparison and has plummeting 41.0%.
However, this isn’t a bad thing. Type in any of the most traded weed stocks and hit the graph all on any of the stock trackers. You will see that generally everything is red but also note that most of these stocks have barely been around for a year. So, just as state’s weed industries are going through growing pains, so are the stocks. This is a natural market correction that is absolutely to be expected. What is the recommendation? It is always to buy the market. This means buy little amounts often. This correction is a great time to invest. Once the correction plateaus the only way is up.
What should I be watching?
Here are some of the major players that will be around for the long haul when you are ready to invest in CBD and CBD edibles:
• Dixie Brands Inc.
• Plus Products Inc.
• OrganiGram Holdings
• Aleafia Health
• Aphria, Inc.
• Canopy Growth Corporation