It’s quite likely that you’ve heard about the legalization of recreational or medical marijuana. At least 30 U.S. states have legitimized recreational or medical marijuana use despite very nebulous federal legislature and enforcement. Just last week, Canada legalized the use of the popular plant, possibly spreading the word of marijuana’s health benefits and economy boosting potential to thousands more international eyes and ears.
So what does this mean for African Americans? Other than being one less reason for being unjustly harassed, arrested or imprisoned by law enforcement officials, this marijuana momentum represents a huge economic opportunity. I promise this article isn’t going to take a left turn and convince you to move to Oregon, Washington or Colorado. I’m also not going to give you a step by step on how to cultivate or distribute pot to get wealthy. I simply wish to raise awareness and share how we can cash in on the legal cannabis wave.
The Truth About Marijuana Use
I’m a proponent of recreational cannabis use, and I also happen to be a trained medical professional with better than average knowledge (I’m certified to issue medical marijuana certificates) about the health benefits of using cannabis. I’ve got melanated skin in this game, and I can tell you that one of the major obstructions to the legalization and monetization of cannabis and cannabis related products is just plain old ignorance. The powers that be have taken great steps to stigmatize cannabis use, which is why I still have to go through great lengths with both patients and colleagues to normalize discussions around the use and applications of medical marijuana. For this reason, I always start the discussion conservatively with the subject of our first method: good old cannabidiol.
Cannabidiol or CBD is just one of the hundreds of pertinent molecular components found in the hundreds of different plants in the cannabis family. Its big brother THC gets most of the hype and camera time, because frankly, that’s the component that gets users that trademark bright and buzzy sativa high or the full body massage feeling of an indica strain. Ironically CBD and THC have almost identical molecular structures, but whether isolated or combined with THC, CBD can do some wonderful things to the human body. From taming some of the more annoying effects of THC (when used in combination) to flat out treating and relieving symptoms of chronic diseases such as asthma, seizure disorder, multiple sclerosis, and lupus, CBD is rapidly making its way to the forefront as a miracle remedy.
This past March, The Washington Post highlighted a few unorthodox usages of CBD, such as for facials and skin balms. It feels as if a new use or indication is discovered every other day, simply due to increased interest and research. Several industries, such as pharmaceutical companies, food and beverage producers, health food stores and spas have not just featured CBD as an oil, which is a common approach, but they are also doubling and tripling their resources to make CBD their main attraction. Now that I’ve hopefully boosted your cannabis IQ, let’s talk about a few ways we can earn income as a part of what weed industry folks are calling the “green rush.”
Investopedia steered clear of OTC market options when it highlighted several viable billion dollar market cap companies that have made huge financial investments in cannabis related or infused products. Over the counter (OTC) markets tend to offer riskier stocks and should generally be avoided by most investors. Some of the companies for OTC and traditional markets include foods, beverages, vapes, growers and dispensaries. Many of these companies have seen substantial growth in the past year or two, but clearly, the best is yet to come. Companies like Canopy (CGC) are drawing a lot of attention in this regard.
Established beverage giants such as Molson Coors (TAP) and Heineken (HEINY) have made huge steps to establish themselves in the green rush as well. Diversified companies like this can offer you exposure to marijuana’s growth but may be less risky than some of the volatile companies on the OTC markets.
The ETF Managers Group (ETFMG) offers a marijuana focused index fund under the ticker MJ. It invests across several different marijuana companies and can provide diversification and a simpler investment strategy. The fund does carry a higher than normal fee, but with few options and the volatility of the market, it offers an easy entry point into investing in marijuana. Accredited investors have a few more options, including venture capital funds or equity crowdfunding.
Real estate investors from all walks are scouting potential sites that are ideal for both outdoor and indoor cannabis growth, processing, and distribution. If you are well versed in real estate, consider this option. If you understand the growing process well, have a good knowledge of commercial real estate, and understand the legal implications of working with marijuana companies, there is an opportunity to be had for the seasoned investor.
Even more universally appealing are the prospects of REITs (real estate investment trusts) that were created specifically for this purpose. One such example is Innovative Industrial Properties Inc. (IIPR) which has acquired over 600,000 square feet of rentable real estate intended for cannabis growth throughout several states, including New York, Maryland, Arizona, and Minnesota. IIPR can also be found on the major exchanges.
Pot themed cryptocurrencies such as pot coin (POT) and more recently DASH (DASH) have cannabis themed utilities tied to both their intended function and marketing efforts. Of course, there is no way to tell if either of these digital currencies (or any) will emerge as the cannabis cryptocurrency frontrunner or provide any real return. But if you are aware of the fundamentals of cryptocurrencies/blockchain technology and the risks involved, they are both certainly worth the time to research. If you aren’t already invested in cryptocurrency, take the time to understand if it’s even right for you before trying to jump in on a craze.
All of these options are largely passive income opportunities. This means that investors can earn from the cannabis industry without ever touching a plant. It’s also worth staying aware of companies that do well as producers of cannabis related equipment such as farming tools, LED lamps for indoor growers, child safe containers and vaporizers/vape pens because they can also make great investments.
Using your imagination and leveraging current and future trends will certainly yield more and more investment opportunities. Some sound advice: Never invest in ANYTHING you do not understand, and cannabis and its associated financial institutions and industries are no exception. This does not negate the fact that now is the ideal time to investigate and take action on any or all of these opportunities. You can pursue many of them online as you multitask, and read this article.
It is estimated that North America will increase its spending on legal cannabis from $9.2 billion in 2017 to nearly $50 billion by the year 2027. If this figure does not surprise you, then neither should the idea of investing in cannabis related companies, stocks, real estate/REITs or cryptocurrencies. The rapidly growing cannabis industry represents a huge void that is just waiting to be filled by the most assertive and enterprising individuals or groups. So in the words of Russell Wilson, the quarterback of the cannabis friendly Seattle Seahawks’ home state: “Why not you?”
Kwesi Legesse is an author, blogger and speaker. He is an independent publisher with a background in family medicine, community health education and healthcare consultancy. His mission is to spread awareness of tools and practices that lead to black financial, spiritual, educational, health and psychological empowerment.” Follow his publishing company at keyspublishers.com or on Facebook, Instagram and Twitter.