Investing in cannabis stocks is exciting and can be very lucrative. However, given their volatility, it is important to keep these 7 tips in mind to confidently and successfully leverage this explosive sector.
1 – Create Realistic Expectations:
The legal cannabis industry is one of the most exciting investments I’ve ever been around in 17 years of trading and investing. Many cannabis stocks have delivered big returns in a short amount of time. These outsized returns have expectations running sky high for the cannabis stocks. Although I’m expecting great things from cannabis stocks, don’t get too excited about gains and don’t get too bummed about losses.
2 – Focus on the Long Run:
When analyzing an investment, sometimes I use a microscope and other times I use a telescope. For cannabis stocks, I am using my telescope. That means I am looking at this investment from 10,000 feet above. I am expecting plenty of volatility in the short run. But in the long run, I am expecting the industry and stocks to steadily move higher for many years. It’s another way of saying don’t sweat short-term volatility. Continue reading "7 Tips To Make Cannabis Stocks Profitable"→
In April the world's first Marijuana Exchange Traded Fund, Horizon Medical Marijuana Life Sciences ETF (TSE:HMMJ) hit the public markets. The ETF went public at $10 per share and popped during its first few days of trading.
When HMMJ hit the public markets, investors were craving exposure to marijuana stocks as new laws and regulations have helped push marijuana into the mainstream spotlight. Some U.S. states and parts of Canada have decriminalized the drug while it has spread in popularity and acceptance for its medical use.
There are millions of square feet of cannabis cultivation facilities being built all across North America.
Take Americann (OTC:ACAN) for example. Americann is a U.S. based cannabis company headquartered in Massachusetts. Americann is in the early stages of building a 1 million square foot cultivation facility in Mass that will potentially serve as the primary cultivation hub to supply a huge portion of the Eastern cannabis market.
Cronos Group (CDNX:MJN.V) is another good example. Cronos is a Canadian cannabis company headquartered in Toronto. In May, Cronos announced that one of the companies it owns, Peace, had broke ground on a 315,000 square foot cultivation facility.
This project will include a 286,000 square foot production facility, a 28,000 square foot greenhouse, and a 1,200 square foot extraction laboratory.
When finished, this facility is expected to be one of the largest indoor cannabis production facility in the world.
As you can see, cannabis companies are in the process of hugely ramping up their cultivation capacities to meet the tidal wave of demand for cannabis coming down the pike.
One way to profit is to simply invest in the companies building these cultivation facilities. That could turn out to be extremely profitable.