The cannabis industry is one of the fastest-growing in the world, and your ability to make money isn’t tied to just opening a dispensary; you can also buy CBD or marijuana stocks.
When the legendary investor, Warren Buffet, was asked what spurred him on to success, he said he was fearful when everybody was greedy, and he was greedy when everybody was fearful.
Many countries have legalized CBD and marijuana, and soon marijuana will be federally legal in the US, but for some odd reason, many investors are still in doubt!
The global canna-economy is driven by innovative companies, and there’s no better time than the present to buy stock and watch your revenue grow.
CBD & Marijuana Investment Basics
Before you sink your money into a company, there are certain things you need to consider. Common sense dictates you perform due diligence before stock buying.
- What products do they offer?
Cannabis companies aren’t homogenous. They are offering varied services and products. Make sure you understand every detail about the services and products they offer.
- Do they have a good reputation?
It’s hard for a company to grow if customers think poorly of it. A bad reputation usually stems from weak leadership, poor customer support, and inferior products and services. If you see that a company isn’t highly-regarded amongst its target audience, avoid it.
- Are they innovative?
Customers gravitate towards companies they consider superior, and with the internet on their palms, it’s not hard to find these companies. Align yourself with a company that leads in innovation, for it is a sign of long-term success.
Investors are usually keen on the internal factors affecting a company.
For instance, what’s the management like? Is it some college dropout druggie riding on rich-dad coattails and with a habit of bossing around and an implacable ego? Or is it a charismatic leader with diplomacy and analytical and critical thinking skills?
Investors also wish to see the company’s business plan. What are they in it for? How realistic does their world-domination plan sound?
It’s also important to find out whether the company is profitable or whether it’s the future that holds its profit. If it’s a baby company, its fortunes might soon turn around for the best, but if the company has been getting bailed out for the last five years, that’s a major red flag.
Many investors shy from buying cannabis stocks citing restrictive government policies, but as these laws get phased out, it’s a reason for investors to be bold.
Reasons Why CBD & Marijuana Stocks are Hot
Over the past few years, the CBD and marijuana industry have created millions of jobs and contributed enormously to economic growth.
- CBD & marijuana are legal
Hemp-derived CBD became legal in 2018 when the Farm Bill was passed; recreational and medicinal marijuana is legal in many states, and soon cannabis derivatives will be federally legal, which will swiftly open the floodgates for customers.
- CBD & marijuana have numerous therapeutic benefits
For the longest time, we have relied on OTC drugs to manage various diseases but turns out that cannabis is more effective at managing some of these illnesses. Are we saying that cannabis is some sort of life elixir? By no means! Cannabis can never take the place of medicine. But then CBD and marijuana are very effective at managing certain health conditions like depression, fatigue syndrome, and anxiety disorders. More people are discovering this and turning their backs on OTC and prescription drugs.
- Innovativeness and versatility
OTC and prescription drugs are typically administered orally, which is a huge inconvenience to someone who finds their taste displeasing. But the innovation behind most cannabis companies ensures that both CBD and marijuana can be had in varying formats. It attracts more consumers.
How Profitable are CBD & Marijuana Stocks?
The cannabis industry may be hot, but it doesn’t mean that buying shares from any cannabis company is what it takes to make huge money.
The revenue you end up accumulating is dependent on the capital you invest, the company or companies you invest in, and frankly, your luck.