The cannabis industry has already more than tripled worldwide sales between 2014 and 2018 to $10.9 billion. As such, the industry has some Wall Street forecasts calling for $50 billion, $75 billion, and $200 billion in annual global sales by 2030. Figures like these make investing in cannabis stocks an attractive opportunity. However, you don’t need a fortune to start.
A Brazilian investor in the cannabis industry explains that you don’t need a fortune to start investing in the sector. Brokers and applications like E-Trade and RobinHood are a good start.
Reasons to start investing in cannabis
The good news is that there are alternative ways to invest in the cannabis industry and they do not require $1 million in financial applications to start investing.
The cannabis industry is considered to be one of the fastest-growing investment opportunities on the planet. Between 2014 and 2018, global sales in legal cannabis markets more than tripled from $3.4 billion to $10.9 billion, with projections to reach $40.6 billion by 2024.
Despite all this potential, we still don’t have a lot of information about the opportunities for investment in publicly traded companies on the American and Canadian stock exchanges.
As in any new and disruptive sector, there are many risks involved. For example, market volatility, trade risk, new legislation, and lack of liquidity are risks that come with investing in cannabis.
This article should not in any way be interpreted as investment advice or recommendations.
Major players in the cannabis industry
It is important to always rely on a qualified professional. The major players in this new industry are companies that have their business model vertically integrated (adding value throughout the ecosystem). They also have a strong market presence and solid partnerships.
In addition, they are present in international markets and fundamentally develop intellectual property portfolios aimed at more complex production to attract higher margins.
Veritas Farms and Canopy Growth entices those interested in investing in cannabis
One such company is Veritas Farms Inc. (OTC:VFRM), a US-based CBD producer and distributor. The company demonstrates the potential of the cannabis sector through impressive growth in the last year.
In Q2 2019 Veritas Farms generated more than $2.9 million in total revenue equalling a 500% increase since Q2 2018. The company’s gross profits reached $1,523,413 and thanks to great results, managed to reduce liabilities by over $1.3 million.
Another company that fits these parameters is Canopy Growth. Canopy is by far the largest producer of cannabis in terms of market value. Aurora Cannabis, Cronos Group, and GW Pharmaceuticals are also on that list.
Canopy Growth has a market value of $13 billion while Aurora Cannabis has $7 billion, Cronos and GW has $5 billion.
In addition to the four corporations mentioned, there are at least ten other cannabis businesses with a market value in excess of $1 billion in just under two years.
When it comes to the different alternatives for investing in this industry, I would like to divide this discussion into two groups: brokers and applications.
Finding a broker
We can relate to the traditional brokers that already have cannabis companies available in their portfolio. It is important to emphasize that brokers that request a minimum amount to open an account do so only to activate the registration.
For example, the resources will be available for investment, by the client, without any disbursement for opening an account.
Using apps for investing in cannabis
Regarding the apps, I would like to share two ways for opening an account that are available to Brazilians (these are totally free and have no minimum value for opening an account).
Both E-Trade and RobinHood apps can be downloaded through the App Store or Google Play. Although the cannabis industry is relatively incipient, with very attractive projections, it is advisable to conduct thorough research before buying stocks.
You should also assess the risks associated with this investment and its volatility. Solid and sustainable growth takes time, so plans for investing in the cannabis industry should be made with long-term projection in mind.
(Featured image by NeONBRAND via Unsplash)
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