Marijuana is different things to different people. To David Brooks, it’s a youthful dalliance that creates a toxic “moral ecology.” To the Ethiopian Zion Coptic Church, it’s a religious sacrament. And to stock-market buyers, it’s now the hottest investment going.
Bloomberg reports that investors are piling into marijuana-related stocks at a furious pace. Ten weed stocks have risen more than 20 percent so far this year, and one stock is up more than 1,700 percent. Most of these are penny stocks – meaning that they might be rising from, say, 4 cents a share to 80 cents a share. But it’s clear that the sector is heating up.
As with the people who bought Bitcoin stakes once they saw the price spiking, most of the people investing in weed companies right now have no actual interest in the underlying assets. They’re speculating, on the theory that as marijuana gets legalized in more and more places, some of these companies might actually start turning a profit.
One problem with investing in the support industry for a (mostly) illegal drug is that many of the early movers are, well, a bit shady. Bloomberg mentions the existence of one hemp company CEO who previously “spent nine years in prison for running one of the largest drug-smuggling operations in history.” But if you’re looking for something new to put in your Schwab account, and you don’t mind wild speculation on an industry filled with penny-stock sleazes and former convicts, you just might make some money.