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The global marijuana industry is poised for significant growth in the coming decades. With legalization efforts making strides in U.S. states and in countries worldwide, investors have been paying attention and pouring capital into marijuana stocks.
However, while the global cannabis market is expected to reach $445 billion by 2030, the short-term bearish market run caused by high interest rates and a lack of credit among marijuana companies has seen most cannabis stocks take a massive hit in 2022 and 2023.
Despite the fact that marijuana stocks have lost a bulk of their market value, this also represents a major entry opportunity for new investors to get into the market and buy up cheap marijuana stocks with considerable long-term growth potential.
A majority of marijuana stocks and ETFs are composed of unprofitable startups that struggle for financing, as banks and major financial institutions are prudish when it comes to handing out loans to these companies. This adds a specific degree of risk to marijuana investments, which could shift drastically as the wave of legalization goes into full effect around the world.
With nationwide legalization in the United States stalling, the global marijuana market is going through a period of high uncertainty, which can be advantageous for opportunistic investors.
If you are curious about which marijuana stocks you should consider adding to your portfolio before the market starts growing again - this investfox guide is for you.
The marijuana market is represented by a wide selection of public companies, engaged in the cultivation and processing of cannabis for medical and recreational purposes.
Investors also have the option to invest in diversified ETFs and mutual funds to disperse some of the risk.
A vast majority of marijuana stocks are highly volatile and can be solid choices for long-term investors, as well as short-term traders.
Investing in marijuana stocks comes with its fair share of benefits and risks, which are important to consider for investors to decide whether these stocks are the best choice for their financial objectives.
Marijuana stocks are a good long-term investment as the regulatory approach to the substance has changed greatly over the past decade and many countries have, or are on the verge of full legalization, which will increase the size of the global marijuana market.
High interest rates and delayed legalization efforts have meant that investors have cashed out on their overvalued marijuana investments. However, positive developments, especially in the U.S. market can help boost the market once again.
The global medical and recreational marijuana industry is growing rapidly. However, this also comes with challenges as banks are still somewhat reluctant to provide marijuana companies with the necessary credit to fund growth.