Few know the massive rotation happening behind the scenes in the Cannabis Industry. The movement is a rotation by large shareholders of public companies to get the “Cannabis Multiple” attached to their stock. The other important movement is the change in documentation which will allow portfolio managers to carry these stocks in the portfolio. These 2 simple alterations will dictate supply and demand from a macro perspective in this industry. We have said many times in our writings that Cannabis is the single most important sector we will see in our investing lifetime.
We polled portfolio managers to find out how they would invest and what the timeline for this investment in Cannabis would be and how this would take shape ( keep in mind many are already invested). Here is what they told us:
1.) They started pinging their own investor base and requested to change existing offering documents which would allow the manager to allocate a % ( normally 5-8%) of total funds under management.
2.) These pings occurred in Q4 2016 and are coming back now, most managers have been “side pocketing” these investments any way for later allocation.
3.) Once Donald Trump was elected managers started buying Cannabis stocks across the board. It was a massive buying sweep with zero regard for the normal vetting or deep dive. This proved to be fortunate as markets accelerated higher and have maintained these levels.
4.) Many managers 2016 performance were bailed out by these trades, and with 2017 markets higher PM’s for the first time in many years have an opportunity to out perform high water marks from old.
Cannabis Company Information
Our partners at Viridian Capital Advisors are a great barometer and provide excellent information on a useful index, and deals in the works.
At Equities.com we are currently providing research to several portfolio managers as part of our services. You can learn how to sign up if you are public company, or an investor. The battle lines are being drawn as Cannabis Stocks fall into sectors, and individual company analysis begins to accumulate. We noticed the following..
The Index is broken down into sub-sectors which are really cool and easy to follow. See a sample weekly ping from Scott Greiper and his worthy staff at Viridian. Sign Up for Viridian Newsletter here. Below is a sample of the weekly outreach..
Viridian Cannabis Stock Index
chart and photo attribute from Viridian Capital Advisor website
We have been working with Cannabis Companies to assist in navigating the world of publicly traded shares. Much of this is about a lack of banking options, and a confusing regulatory landscape. This is only solved by market awareness at the C-Level and and informed investor perspective. 2017 will be the year of living dangerously in Cannabis..and we love it !!!!
Email me [email protected] if you are a Public Company and would like to see our Testimonials