It’s no brainer that the global marijuana market is growing like weed. According to recent statistics, worldwide spending on cannabis will top %29 billion towards the end of 2020. And this total is expected to increase to $63.5 billion by 2024 at a compound annual growth rate (CAGR) of 21 %. With this increase in growth, there is no wonder that more and more investors will be interested in taking part in hemp stocks trading.
It’s no brainer that the global marijuana market is growing like weed. According to recent statistics, worldwide spending on cannabis will top %29 billion towards the end of 2020. And this total is expected to increase to $63.5 billion by 2024 at a compound annual growth rate (CAGR) of 21 %. With this increase in growth, there is no wonder that more and more investors will be interested in taking part in hemp stocks trading. If you are thinking of investing in hemp stocks, here is everything you need to know about the seven-step process of investing in the fast-growing marijuana industry.
- What is the type of marijuana products?
Before you invest in stocks, learn about the two main type’s marijuana products.
1. Medical marijuana: Medical marijuana is legal in almost 30 countries. To obtain medical marijuana, patients need to provide a medical prescription. It’s mostly prescribed to adults for anxiety, depression, and stress.
2. Recreational marijuana: Recreational marijuana has been legal in Canada and eleven states of the USA.
- What are the different types of marijuana stocks?
There are three main types of marijuana stocks:
1. Cannabis growers and retailers: The list includes companies like Canopy Growth that cultivate cannabis, harvest the crops, and distribute the end product to customers. There is also some focus on retail stores to sell medical or recreational cannabis.
2. Cannabis-focused biotechs: The list includes bio-techs that develop Cannabinoid drugs.
3. Those who provide ancillary products and services: The list includes companies that support marijuana growers. They provide products and services.
• Risk of investing in marijuana stocks: Once you decide to invest in marijuana stock, get ready to deal with the risks. Here is the specific risk investors must know about:
1. Legal and political risks
2. Supply/ demand imbalances
3. Over the counter (OTC) stock risks
4. Financial constraints
• What to all look for in a marijuana stock?
If you are considering investing in marijuana stocks, you should consider the following things.
1. Research the management team
2. Examine the growth of the company and competitive position
3. Check out the company’s financials
4. Determine how many warrants and convertible securities the company has issued.
Specific metrics you must look for include.
1. Cost of sales per gram
2. Cash cost per gram
• Determine the top marijuana stocks to invest in and ETFs
List of top marijuana stocks and ETF’s investors must consider include:
1. Canopy growth corporation
2. GW pharmaceuticals
3. Auroroa Cannabis
4. Aphria
- Invest carefully
It’s no surprise to find this point in the list. If you are a conservative investor, the best strategy will be to avoid investing in hemp. According to experts, only the aggressive and high-risk takers will look for cannabis stock tools for investing. These tools help investors in determining which stock is better and give a brief outlook of the hemp stock trading algorithm.
• Monitor the changes taking place in the marijuana industry
Have a long-term view when investing in marijuana stocks. With all being said, the dynamics of the marijuana industry is rapidly changing. Whatever criteria you use to invest in hemp will change depending on the changes in the marijuana industry. For this reason, it’s important to monitor marijuana stocks or ETFs along with other changes in the industry. Some changes can be beneficial for investors, like the relaxation of marijuana laws, while others may pose a drawback like the stagnant growth of the hemp market.
For the investors, their good news in the form of stock trading software through which investors will receive signals about the most profitable trades. With the software, investors will enjoy steady, consistent gains in the hemp stock market.
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