Cannabis stocks moves up on regulatory actions
Cannabis veterans are pounding the pavement with the “generational wealth opportunity” in US cannabis stocks. But 2021 wasn’t an easy year for this sector to ride out. Compared to seeing triple-digit gains in 2020, many cannabis stocks are down 30% plus.
Last Friday, it was revealed that Republicans are expected to introduce a cannabis reform bill this week with the goals of decriminalizing cannabis level and regulating it similar to alcohol. This sparked a big move in cannabis stocks over the past few days.
- The AdvisorShares Pure US Cannabis ETF (NYSE:MSOS) is up 20% since last Friday.
- Large gains in cannabis stocks including: Tilray (NASDAQ:TLRY) — up 15.6%, Verano holdings (OTC:VRNOF) — up 8%, Canopy Growth Corp (NASDAQ:CGC) — is up 10%.
Head fake? Cannabis investors were left disappointed again and again this year. And this time might not be any different…
- Many in the industry raised doubts on the Republican bill passing — which is trying to achieve a lot.
- Moving through the White House would take months and the Democrats also released their own cannabis reform bill in July — with signs of little progress.
A bill to make banking accessible for the cannabis industry is also moving through the White House — lots of action but little progress. According to Stifel (via Insider), don’t expect full-scale legalization in 2022.
But this won’t stop US cannabis stock veterans from doubling down. According to Aaron Edelheit founding member of Mindset Capital:
- These stocks could go down or go nowhere for years but when legalization comes, they’ll trade on larger exchanges like the NASDAQ/NYSE.
- And when they do — “you may get five years worth of performance in an extremely short period”.