Risk is a common term when it comes to investing in the stock market. The volatility that comes with stock trading cannot be underestimated. For instance, marijuana stocks for are even more volatile but highly rewarding. That’s why you need the right strategies to make things work when investing in this volatile industry. Remember, it’s your money that you are investing in. So, you need to take great caution when doing stock trading. This article is going to explore the steps you need to invest in marijuana stocks with confidence for a chance to make profits.
The Stats
The global marijuana market is making big strides. According to stats, 2018 recorded a $12 million market share. That means that people spent more than $12 million on marijuana and CBD-related products. Even more, this global market is projected to hit $31.3 billion by the year 2022. This represents an annual growth rate of 26.7 percent. So, what do these figures tell you? They tell you that the marijuana industry is here to stay and will create shockwaves in the coming years. That’s why investors are simply flocking to marijuana stock arena to have their pieces of cake. So, why don’t you try to claim your share? Take your trading game to marijuana stocks. But, wait. Don’t rush. Stocks are volatile in nature. You need the right strategy. Otherwise, you will end up a devastated trader. The following steps are all you need to trade in style.
Understanding Different Types of Marijuana-Based Products
Cannabis products are divided into two broad categories:
- Medicinal marijuana
- Recreational; marijuana
Within these categories, you will find several types of marijuana products. According to the stats, about 33 US States have legalized the use of medical marijuana. Plus, countries like Canada and German have legalized the use of marijuana for medical purposes. Thus, patients must get a prescription from an authorized medical practitioner. Commonly, medicinal marijuana is prescribed for conditions like anxiety, pain, stress, as well as depression. In most cases, you can take marijuana by inhaling the smoke or vaping its concentrates. Also, you can consume it through edible products containing marijuana and cannabis-infused liquids or beverages. It’s also important to note that you can go for creams and lotions that contain marijuana. Plus, other chemical ingredients can also contain marijuana ingredients.
CBD is one of the most common types of a marijuana product. With CBD (an abbreviation for Cannabidiol), you have a marijuana product with no psychoactive effect. Unlike THC, CBD doesn’t make you high. The best part, the FDA recently approved the use of Epidiolex—a CBD drug—for treating conditions like epilepsy, LGS, and Dravet syndrome.
Also, the FDA has conducted research and approved the following THC-based drugs:
- Syndros
- Marinol
- Cesamet
These drugs can be used to treat chemotherapy-induced nausea as well as vomiting. Also, it has been established that Marinol and Syndros can be used to treat AIDS-related anorexia. Its, however, important to note that these drugs have been manufactured using synthetic THC and not marijuana compounds.
District Columbia is one of the few states in the United States of America that have approved the use of recreational marijuana. However, product use is restricted and is only available to adults only. In Uruguay, the weed was fully legalized in the year 2013. You should also know that the Canadian parliament legalized the use of recreational marijuana in 2018.
Different Types of Stocks
As a new trader, it’s important to familiarize yourself with different stocks when it comes to cannabis. Marijuana stocks are divided into 3 major types. They include:
- Cannabis growers & retailers—with cannabis growers, you have companies that grow, cultivate, harvest, and distribute cannabis to the market. Companies like Canopy Growth fall under this category. They use facilities like greenhouses to grow and finally distribute these products to the market. Also, some of these companies may focus on running retail stores. Some of these companies are listed on the stock exchange market.
- Cannabis-focused biotechs—with Cannabis biotechs, you have companies whose main purpose is to develop cannabinoid drugs. Companies like GW Pharmaceuticals fall under this category.
- Ancillary product/ service providers—with these companies, you have service providers who support marijuana growers. They do this by offering them products as well as services such as lighting systems, advice, hydroponics products, packaging solutions, management options, etc. Companies like Scotts Miracle fall under this category.
Understanding the Risks
Stock trading, as you know, is a game of numbers. It comes with lots of risks. From the risk of losing your investment in choosing the wrong trade—stock trading can pin you down and lead to lots of frustrations. Likewise, investing in marijuana does come with many risks. That’s why it’s important to understand these risks. You need to understand the legal and political implications of investing in marijuana products. Also, familiarizing yourself with supply and demand imbalances can be of great help. Finally, it’s advisable to understand Over-the-Counter (abbreviated as OTC) stocks. From here, you can then devise plans to mitigate these risks. This will cushion you from loses and give you an upper hand when it comes to nailing huge profits.
The Bottom-Line
Nothing comes easy. You must sweat for the money. You will have to put in an effort. For instance, marijuana stock trading is not an easy thing. Of course, you can rush there and the next minute you are out—crying that all your money is gone. Is this what you are looking for? Probably not. You need the money. You require profits. So, here is the deal. Discipline. Consistency. Knowledge. These are the things you need to make huge profits in https://ragingbull.com/kb/best-marijuana-stocks/. Plus, you need the right steps to navigate through this thorny investment journey. The above are the necessary steps to follow if you want to arrive at the Promised Land with huge profits. These steps will never disappoint you as far as investing in marijuana stocks is concerned. Remember, be disciplined, have patience, use the right strategies, and research more.