Why Invest in Marijuana?


Why Invest in Marijuana?

If anyone had approached you to invest in weed about a decade ago, you probably would think the individual is high on something, like the blunt itself. Fast forward to 2019, now everything is rapidly changing. Cannabis is gradually becoming a global industry with governments across the world slowly embracing the profitability and benefits hidden beneath the tough laws and strict regulations that have stifled growth for years.

From being a dirty word, marijuana has gone mainstream to build a multi-billion dollar industry.  In a joint research by ArcView Market Research and BDS Analytics, this industry is set for more growth in the coming years. While the research projects the industry to be worth about $32 billion by 2022, that figure appears very modest compared to a far more optimistic analysis by Grand View Research that puts the estimate at about $146 billion by 2025.

A new world of opportunities

We are now waking up every day to news of IPOs and several mergers and acquisitions of marijuana-based businesses. What was largely considered a risky venture a few years back now offers a great business opportunity for investors and corporations. While the push for legalization is still a major challenge, we can expect things to get better as time goes on. This emerging market is gradually maturing and for investors, this appears a lot similar to the proverbial early bird that catches the fattest worms. Cannabis has come out of the shadows and today, many investors are scrambling for marijuana stocks with great potential to invest in, thanks to the emerging opportunities.

Marijuana companies are springing up!

The traditional perception of marijuana use majorly centers on someone puffing away at a joint or someone munching stash-infused brownies. Far from conventional stereotypes and classical image, new companies are emerging every day exploring and exploiting the potential of using the psychoactive THC as well as the CBD components of cannabis in new ways that won’t get you high.

CBD-infused balms and lotions are becoming a thing in the beauty and wellness industry. Cannabis-infused coffee and beverages are also becoming popular as are THC oral sprays for those who want to experience the psychoactivity of marijuana without smoking, talk about eating your cake and still having it!

Investing in Marijuana

With respect to current developments, smart investors would want to capitalize on the enormous potential in this industry. Investors considering stocks can weigh their options in both Canadian and American stocks. Although some states have legalized medical and/or recreational use of marijuana in the US, it still remains a controlled substance federally. On the other hand, it’s legal for both recreational and medical use in Canada, at the federal level. The thing is there are less regulatory challenges in Canada compared to the United States. But when you look at things from a valuation and potential growth perspective, the US appears a lot better.

Marijuana companies are rising up to fill different roles, from growing to processing, sales and distribution, among other services that may include packaging and supplies. That’s not forgetting the biotech sector which has been a key player in the growth of this industry. While there are no doubt very obvious challenges at the moment, it’s safe to say the future is bright for smart investors ready to make guided and informed decisions investing in marijuana stocks, considering the huge potential in this industry.

Jeff Clarkson

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