“The Stuff You Won’t Hear Anywhere Else”
The legalization of Marijuana has given birth to a new industry. Whether morally you condone the use of it or partake in it , it seems to be the future of what is socially acceptable in society as a whole. While we may not agree on the socially acceptable part of it, we can all agree that if it’s legal and we can somehow make money in investing in a particular industry sauce as marijuana, it needs to be explored as to how to go about doing it.
Could the Marijuana markets be a sector which could become very profitable? Well I say maybe not right at this instant, but what about 5,10 or even 20 years down the road. Lets look at the facts right now and apply them to the future of where society is heading.
First of all Marijuana is a popular drug, it’s popularity is increasing every day and every year and has been since the 1960’s. So there is a demand for it , Damn those hippies. Independent surveys have quoted that 7.6 Americans light up or smoke Marijuana every single day of their lives, and millions more use it on an occasional basis. But the real number which they seem to omit is around 50 million people partake in it all total. Thats a huge number, and a sixth of our total population.
In 2015 legal Marijuana sales were estimated at 5.4 billion dollars, in 2016 legal Marijuana sales grew 25% to an estimated 6.7 billion dollars. Analysts anticipate the recreational usage by 2020 to be worth about 21 billion dollars, If you look beyond that and go out another five years analysts project that legal Marijuana sales could reach 50 billion dollars…..Wow…Can we possibly make great returns thanks to the potheads? They can burn their brains out and we can laugh all the way to the bank! …Ok that was insensitive…but I don’t care…do you?
Here’s more food for thought of our 50 states only 7 currently have legalized Marijuana for recreational purposes, and 26 states have legalized it for medical usage. I can anticipate in the future that more and more states will legalize it for recreational purposes, and once they all follow suit we could be looking at a potentially 200 billion dollar industry….Where do I sign up for that? The marijuana sector could possible be one of the best kept secrets and one of the best investment strategies in the future, knowing how this politically correct society seems to operate, it’s not hard to figure out where it’s headed….Hopefully not down the tubes…….
The MJIC index is the Marijuana Index, also known as the ( Mary Jane Index ) bet you never heard of it, It tracks the top Cannabis stocks and like any index it lists all the holdings, the most active and top gainers and losers. It is a weighted basket of 30 stocks and Exchange Traded Funds, The companies listed in the index must meet certain requirements. First of all they must have a minimum capitalization of 30 million dollars, their daily trading volume must be at least 600,000 shares traded, or companies over 5 million in revenue are exempt from the latter requirements. So there is a start for you to investigate this sector.
The moral of this story is if you have the money to buy the Marijuana, why not buy the stock instead and potentially make money off of someone else’s high, It’s healthier and potentially more profitable. Make sense to you ?
Remember this is a new industry, there are also a large potential for scammers and thieves out there. The industry itself is operating in a grey area as far as I am concerned, somewhere between moral and immoral. But I leave that up to you to decide. Personally I look at it from a business and an investing perspective, such as what are the risks verses the rewards? What are the potential returns in invested capital? I think this sector needs a serious look at for the future of investing, like all investments in sectors do not put all your eggs in one basket, diversification is the secret to success, But I will look at it as long as it is not all smoke and mirrors.