Cannabis Investing

High Returns: 7 Ways to Get Started with Investing in Cannabis

By November 25, 2019 No Comments
investing in cannabis

The Green Rush is here. 

As you know, marijuana is now legal in much of the United States — and as the demand grows for the green herb, so do money-making opportunities within the cannabis industry. 

Savvy investors everywhere are asking how they can get started with investing in cannabis, and with good reason. 

The cannabis industry has a projected growth rate of 230% in the next few years. Global spending on legal cannabis is expected to be at $32 billion by 2022! 

Keep reading to learn more about how to invest in marijuana.

1. Do Your Research Before Investing in Cannabis

This should go without saying, but before you start flinging your money around at the latest shiny green stock, make sure you’ve done your due diligence. You need to research the stocks and companies that you’re investing in!

The fact that you’re here reading this blog post right now shows that you’re already down the right path in learning how to invest in marijuana.

If you’re really serious about cannabis investing, then keep reading. 

Read cannabis company press releases. Go through their SEC-filing reports. If you don’t have the time or knowledge to do that yourself, then you’ll want to consult with cannabis experts to gain insights on the leaders of the cannabis industry. 

Once you’ve read up on the cannabis industry and familiarized yourself with some of the best marijuana companies to invest in, you’ll be ready to make a decision of where to put your money.

2. Invest in Technology and Software Companies That Serve the Cannabis Industry

Even though marijuana is becoming legal in multiple states, it is still classified as a Schedule 1 Drug by the U.S. Federal Government. This makes some investors hesitant to put their money directly into dispensaries or marijuana stocks themselves, because of this federal gray area. 

If you’re looking for a less direct way to get started with investing in cannabis, then you should consider investing in technology or software companies that serve the cannabis industry.  Ancillary companies like these are actually some of the highest-valued companies in the cannabis industry right now.

By “ancillary companies,” we mean any kind of company that provides some kind of necessary service to the marijuana industry. That could be payroll services or other software. Biotechnology companies, working in the pharmaceutical and/or agricultural side of the industry are another recommended option for investing in medical marijuana.

The simplest way to get started with investing in these ancillary companies is to either invest in single stocks within the company or to invest in an ETF.

In fact, let’s talk about ETFs now. 

3. Invest in ETFs

One of the most straightforward ways of investing in cannabis is to put your money into an ETF (that’s an exchange-traded fund).  

An ETF is basically a group of stocks within an industry that are all bundled up into one fund. Rather than investing in all those individual stocks, you invest directly into the fund. Your investment into the fund gives you a percentage of ownership into each of the stocks within that fund.

If you’re not feeling up to weeding through lots of individual cannabis stocks, then ETF’s are a great way to diversify your cannabis investing portfolio without spending too much of your own time researching or sweating over the stocks you’re investing in. 

Investing in cannabis ETFs might mean investing in an index fund of only cannabis stocks, or in a mix of cannabis companies and ancillary companies. 

If you’re a more independent investor, keep reading for some more “adventurous” options. 

4. Invest in Single Stocks

Though we caution against investing too much into pot stocks, if you are a savvy and adventurous investor, then individual legal marijuana stocks might be the right place for you to start your cannabis investing. 

Investing in single stocks is when you purchase a single share of ownership of a specific company. Cronos Group and CanniMed are just two examples of cannabis companies with individual stocks available for investment. 

Right now, many of the leading cannabis stocks are based in Canada — which means you’ll have to purchase them on the Canadian stock market. However, as the industry grows, U.S.-based cannabis stocks are becoming more available. 

As we mentioned above, make sure you research the cannabis companies and familiarize yourself with any potential risks before putting your money into their stocks.

5. Invest in a Dispensary 

Perhaps you have the entrepreneur spirit yourself, or maybe you just want to put your money more directly into the cannabis industry than what you can do with stocks and ETFs. 

Many investors prefer the medical sector of cannabis investing, as it feels a bit less risky than recreational marijuana. Investing in medical marijuana dispensaries is one option.

Now that medical marijuana is legal in 33 states (plus DC), dispensaries and medical marijuana companies are popping up around the nation in order to meet the growing demand for medical marijuana.

However, if you’re looking for marijuana companies to invest in, dispensaries are definitely not your only option. Remember what we said earlier about ancillary companies? 

6. Invest in Other Cannabis-Related Businesses

Get creative — any company can market themselves towards the cannabis industry. Giggle Insurance is a great example of a company that’s meeting a specific need of the cannabis-consuming population, and they have nothing to do with the production or sale of marijuana itself. 

Perhaps you want to put your money into companies like that, or maybe you already have your own business skills that could be targeted towards the cannabis industry!

Are you an interior designer? Social media manager? Realtor? Dispensaries need people with these skills to help get their businesses up and running. 

7.  Start a Career Within the Cannabis Industry 

If you’re really interested in getting involved with the cannabis industry, then you might want to consider diving right into a marijuana-related career.

With over 200,000 jobs in the cannabis industry, there’s never been a better time to find where you fit in. 

Budtender, growmaster, edibles chef, quality control analyst, cannabis consulting — these are just a few potential cannabis careers that are taking off right now within the cannabis industry. 

Still, Have Questions About Investing in Cannabis? 

Take a look around our blog for more information about the cannabis industry.  Feel free to contact us with any further questions you might have about investing in cannabis! 

Quantum9

Quantum9

Quantum 9, Inc. is a Chicago, IL-based cannabis consulting firm. We specialize in getting high net worth individuals and private equity cannabis business licenses to cultivate, manufacture and dispense marijuana. We have over 50 marijuana consultants that work for the company, and we have practiced in 12 countries. Our areas of expertise include permit acquisition, team building, employee training planning, and process planning. We help clients fully maximize the potential of any cannabis cultivation, processing, and dispensary business.

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