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“(Trading) volume drove the price spikes at the end of March, early April, and since then it has really dropped off,” said Dan Nicholls, vice-president of the Marijuana Index which tracks top-performing stocks in North America.

Dramatic spikes in share prices have attracted scores of first-time investors who have put up their own money to ride what they hope will be a big green wave to riches.

Matt Henry, a telecommunications technician in Calgary, said he’s invested $18,000 of his own cash in a single company, Ontario-based Supreme Pharmaceuticals. Given recent declines in the stock market, his investment was down 10 per cent Monday, but he’s not too worried.

“I’m a pretty patient guy who doesn’t get stressed too easily so I can handle it,” said Henry, who plans to ride the cannabis market for at least another year or two.

Henry said he expected share prices would fall, because “everything was way too high; it could only come down, but I’m a little surprised it’s still going down.”

Nicholls said several factors have likely weighed on share prices. While he agreed the industry is looking for more clarity on legalization rules, he added investors have followed a familiar pattern of buying on rumours and selling on news, after Ottawa tabled legislation in April.

Nicholls said he wouldn’t be surprised if investor fatigue was also helping to drive down share prices as more licensed growers enter the market looking to cash in on what is widely believed to be a multibillion-dollar industry.

“We’ve seen four or five new (licensed growers) go public in the last month,” he said.

“For some investors, this is a brand new market; some of these companies aren’t producing revenue, so it can be difficult for investors to differentiate between the different (growers) as more and more are coming online.”

rsouthwick@postmedia.com