Despite all the legalization news surrounding cannabis, investors still view it as a speculative market at best, while many others take issue with buying stock in something that (on a federal level) is still illegal. It looks like, even after the rise an fall of pot stocks this August, they may be on the rise once more.
Writing off marijuana stocks at this point in time would be a bad move, especially for those who missed out on the first major run made back in 2017.
Unsurprisingly, though it still isn’t legal on a federal level, a recent Gallup poll pulled results that stated about two thirds of America support complete legalization. With that in mind, we shouldn’t expect a pot friendly country any time soon, the legalization of many new states barely made a dent on existing legislation and cannabis stocks are still in the doghouse for now.
An end to the flood of pot stock selling may be on the horizon, with the bumps in the road serving as an effective “test-run” for pot distributors. The company Constellation Brands (NYSE: NYSE:STZ) just upped its interest in the marijuana giant Canopy Growth Corp. (NYSE:CGC) by making a $4 Billion investment in the company. In addition, Cronos (NASDAQ:CRON) caught the eye of the tobacco giant Altria (NYSE: NYSE:MO) who acquired almost half of the company.
Even with their rocky past these last few months, Canopy Growth and Cronos have nabbed two of the biggest “vice” companies in the industry due to the expectation that weed interests are going to explode very soon. There are far worse moves to make than investing in a down and out marijuana company when a pot stock rise is on the horizon.
Next up? Five gold rings! (Had to get that Christmas reference in somewhere.)
While gold may not be the adrenaline inducing market that cannabis is, that doesn’t make it any less appealing for investors. In such a volatile market, it’s nice to fall back on something dependable like precious metals, which have all enjoyed a nice recovery these past few weeks.
While silver and copper have also risen, gold is the Beyonce of this metals trio, having risen about 5% since October. Gold’s rise also benefitted mining companies such as Barrick Gold Corporation (NYSE:ABX) and AngloGold Ashanti (NYSE:AU).
Adding fuel to the fire, it looks like inflation may increase in the very near future, stoking the fears of investors who had worried about inflation's seemingly inevitable rise. In light of the uncertainty that long term bonds once provided, many investors are turning back to gold.
It’s been long enough since gold had a nice run, even with the economic instability and its oversold state. 2019 might just be a return of the all time high in gold prices we saw back in 2012!
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