Since therapeutic cannabis has made its appearance and this activity has developed worldwide with changes in its legalisation it has become possible for individuals to invest in this activity sector which can be highly advantageous. Through this article we will explain how you can invest in cannabis on the stock markets and trade in this sector online.
Firstly, maybe you are wondering why an investment in the marijuana sector may be advantageous:
It should first be noted that the general public is increasingly acceptant of cannabis and the image of what was considered a purely recreational drug has changed over time. In fact, a growing number of governments are deciding to legalise cannabis in their country, primarily for therapeutic reasons but also recreational purposes in some cases with specific rules of course. These ongoing changes in the cannabis sector are of course highly promising for the future growth in this industry and the marijuana sector has never looked as promising or advantageous.
If for example we base our forecasts on recent research completed relating to this market, notably that concerning the cannabis industry in the United States, we note that this could generate over 75 billion dollars in the coming decade, between now and 2030. These highly encouraging forecasts are supported by the growing interest of investors in this asset as more people are tempted to benefit from the rising trend in this specific market by investing, for example, in shares from companies that operate within this sector.
The best way to invest in cannabis now is still considered by many to be trading through an online broker that offers CFDs or Contracts for the Difference. Using these contracts you do not actually buy shares in these companies but simply speculate on movements in the share price. Your profit or loss will be based on the difference between the share price at which you opened your position and the price when you closed your position. Here we offer you the opportunity to learn more about the numerous advantages of this type of investment in cannabis on the stock markets.
Let us now pass on to some explanations regarding the assets you can speculate on when investing in cannabis. The best way of succeeding in this type of investment is trading in shares issued by the companies in this activity sector. This could be a company specialised in the production of cannabis, biotech companies that use cannabis in the manufacturing of their products or tobacco products and drinks suppliers that use this type of natural commodity.
These assets represent an excellent opportunity as they demonstrate a high volatility and movements that are often clear and long lasting with a succession of clearly identifiable rising and falling trends.
We can however differentiate between companies in the therapeutic cannabis sector and those in the recreational cannabis sector. The biotechs in particular are specialised in the therapeutic sector and are perfecting cannabis based treatments that can then, according to legislation, be prescribed for the treatment of certain pain generating illnesses and health problems. One of the advantages of speculating on the share price of these biotech companies is that they often benefit from the effects of announcements made regarding their success in trials or when they obtain authorisation to launch their products on the market. It is therefore possible to take position on these assets by basing your actions on a fundamental analysis and therefore on news and events. The movements are often particularly volatile and therefore offer the possibility of significant differences in the share price which can be highly profitable with numerous opportunities.
For an investment over the longer term we would favour assets from cannabis producing companies that have experienced a stable and reliable growth at present due to a significant increase in demand.
To invest effectively in these assets it is of course necessary to thoroughly understand how the cannabis market operates and thereby be able to understand the factors that can influence it. When completing a fundamental analysis on these assets you should therefore favour the following factors that are the most influential:
You then simply need to choose the type of assets in which you wish to concentrate your investments. Here are a few examples of companies in different sectors of the cannabis industry that you may invest in at present: