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Weed Stocks: The Legal Risks and High Rewards

Does anyone else remember the cryptocurrency craze that sent bitcoin stocks soaring? At its peak, prices rose by 2,000 percent. There were many self-made millionaires that made bank on their decision to invest.

Now, a new potential money maker is emerging: weed stocks. There are a lot of questions surrounding such an investment. Is it legal? What are the risks and rewards?

Read on to find out.

The Legality of Investing in Marijuana Stocks

There’s no doubt that investing in marijuana is a confusing area of the law. It remains a federal crime to get caught with weed, yet many states have decriminalized it.

The legality of owning weed stocks is a gray area. Indeed, investing is a conspiracy to violate the Controlled Substances Act. Despite this, a prosecution is very unlikely.

Many companies including Heineken and Molson Coors Brewing Co. have joined the game. They’ve both announced coming cannabis-infused products.

Could their investors get charged with a crime now? Most lawyers agree that it’s not likely, and it has never happened in the past.

How have marijuana businesses thrived despite the law? The federal government has declined to pursue charges against marijuana businesses. They haven’t targeted them because of policies set in place by former President Obama.

President Trump has hinted at policies allowing states to set their own weed laws. It seems evident that a reversal in the policy at this point isn’t what the public wants.

What Other Risks Are Involved?

While you shouldn’t sweat criminal charges, investing still comes with risks. Marijuana stock risk includes the possibility of the company going south.

If the federal government started cracking down on cannabis, then things may change. You’ll need to keep up-to-date with the weed stock news as an investor.

Keep in mind that there are many marijuana-related industries like:

  • Hemp products
  • CBD Oil
  • Medical marijuana stocks
  • Biotech companies

Investors always face the risk of an economic downturn.

If you’re interested in the current stock market, then you’ll want to follow the Dow today. These companies help give consumers a broad overview of how the general economy is doing.

What Are the Benefits of Investing in Weed Stocks?

Right now, there are at least six public marijuana stocks:

  • Aurora Cannabis Inc.
  • Cronos Group Inc.
  • Apharia Inc.
  • Canopy Growth Corp.
  • Tilray Inc.
  • GW Pharmaceuticals PLC

These companies are the biggest players, but there are dozens of similar businesses. 

The most obvious benefit of investing is the potential money you can make. The industry will continue to explode as marijuana legalization efforts continue.

Big gains are always a possibility in emerging markets. The Canadian Bank CIBC believes the market will top $6.8 billion CAD by 2020.

So, Is It Safe to Invest?

Investing in weed stocks does carry risks, but there are also rewards. The legality of marijuana makes many investors skeptical. These concerns are legitimate, but it’s unlikely such investments would cause an arrest.

Does investing in marijuana sound appealing to you? What are your thoughts? Join the conversation by leaving your comment below.

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