Cannabis Health Insider

The relaxation of marijuana-related laws across the USA has certainly increased investment prospects in marijuana stocks. With rising global interest in the market, the future of marijuana stocks holds promising results for investors.

This move has opened new opportunities for the venture portfolios of stakeholders in the market.  If things move in the right direction, one can expect exceptional returns along with improvements in economic indicators.

Is 2020 a year of recession?

The year 2020 has seen unbridled economic uncertainty and changing trends in the stock market so far. After a slight recovery from the market crash that began in February, speculations of further bearish market trends have left investors, skeptical.

For some stakeholders, classifying this year as a period of recession is an early ruling. The National Bureau of Economic Research, however, has a contradicting verdict. It categorizes 2020 as a recessive year due to the unconventional drop in unemployment and production it triggered globally.

It is not surprising to see how the stock market is striving hard to recover from the recent unexpected blows. Investment opportunities offered by marijuana stocks can certainly help economies tolerate the effects of this partial recession. Many hope this year sees a shorter dip of growth as compared to the previous episodes of contraction.

Did marijuana stocks perform well in 2020?

Despite the pandemic, the trend in the growth of marijuana stocks has been encouraging in the past few months. This trend has made marijuana stocks a safe haven for investors who are hungry for higher returns on investments.

Part of this growth in marijuana stocks can be associated with the pandemic itself. People following SOPS are turning towards marijuana usage for recreational purposes, causing a spike in consumption.

The recent policy by 11 states permitting recreational marijuana usage is a big move that has spiked marijuana stock prices. In addition, 33 other states that permitted medicinal usage, has opened new windows for marijuana-related investments.

This decriminalization of marijuana has also become a new and attractive source of tax revenue for the government. According to Forbes, the state of Washington has generated around $319 million in cannabis tax revenue, while California and Colorado produced $ 300 million and $266 million respectively.

With the increasing burden of social benefits, these tax revenues may spike federal interest. This factor has also piqued the interest of stakeholders, as the marijuana industry has not only survived well but outperformed various sectors in this pandemic permeated year, making it a big source for job generation and tax revenues for the government.

This has been a much welcome change for ancillary companies like KushCo holdings Inc. The company has seen a massive growth of 130% since March of 2020, as compared to the previous losses of 45% in revenues. The company now stands on the hot list for investors, who are eyeing it as a profitable future investment.

Other companies like OrganiGram Holdings, Aurora Cannabis, Aphria, etc. are also making it to that list successfully. This can be associated with increased demands from countries like Poland, Germany, and Canada, which now allow recreational marijuana use.

Another less discussed factor that may probe spikes in marijuana stock prices is an increased diversion of the general public towards alternate medicine. There are speculations for the CBD market to grow to $1.3 billion by 2022 from a $390 million in 2018 according to New Frontier Data.

With big chain stores like Kroger, Wholefoods, and American Eagle showing interest in selling an extended range of CBD products, investors can expect the market for marijuana and its related derivatives to see a positive trend in growth rate, providing profitable investment prospective.

All in all, it can be deduced that the marijuana industry has a lot of potentials not only in the United States but also globally. This makes it a safe investment for stakeholders considering the market trends so far.