The number of investors targeting the cannabis industry continues to rise each week
The thinking that many investors had about the cannabis industry several years ago has taken a sharp turn after seeing the unexpected growth become a reality. The same level of objection to the industry is no longer being heard, and the reasons at the end of the day are becoming more and more obvious. After seeing major states like New York legalize marijuana and even a country with a huge marijuana trade like Mexico, this stigma has been disappearing dramatically. As a result, investors are no longer shy about investing in cannabis stocks and the number of investors attracted to this segment continues to grow substantially.
There is no doubt that in a few years, this type of industry will begin to have a more traditional development, something that currently has not been able to have due to various restrictions. Large companies such as Tilray and Canopy Growth have been faithful witnesses of how the prices of their shares have been positively affected after seeing how the legalizations arrived little by little in different states.
As with any type of investment, there are always risks and factors to consider. “All of our cannabis stock purchases to date are all speculative purchases, and we also have holds and sells,” said Matt Bottomley, equity research analyst at Canaccord Genuity in Toronto. However, as the market stabilizes, the speculation decreases.
One day, stocks can have a rally, and another day they can decline in an unfortunate way. That’s why this is a process that requires a lot of patience and the investor has to start to get comfortable with the growth curves. It is understood that stocks move in the same direction as political updates on the future of legalization, but even so, this should not be an influential point for investors.
Keep in mind that not all companies are exposed to the same markets or regions and be very mindful of how they are positioned in the markets relative to their peer group. Finally, remember that the management team and its philosophy always play an important role. Companies with necessary and not excessive acquisitions tend to be the most successful in the long term.