Why You Have to Go to Canada to Buy American Pot Stocks and Vice Versa

As cannabis stocks experienced a massive spike in popularity throughout 2018, there is a trend of mutual dependence that is emerging among public cannabis companies in the USA and Canada.

“wine glass with cannabis leaf decor” by Justin Aikin on Unsplash

Earlier this summer, I accidentally went on a “green state” tour through Nevada, California, Maine, and Colorado, yes, half of the American states that have legalized marijuana. If not anything else, this tour illustrated the vastness of the emerging marijuana industry throughout the country. Between the cannabis billboard advertisements on the drive across western Colorado from Grand Junction to Denver, the amount of money spent on informational technology at one of MedMen’s newest locations in Venice Beach, or the quick conversation I had with a budtender at a 24/7 weed store in Las Vegas about the money spent on cannabis lobbying, this country assured me that the cannabis industry is exploding.

Traveling that I do often introduces me and inspires me with new ideas for my business and investments. This summer’s tour through some of the green states was not any different. At night, after squeezing every ounce of energy out of my day and tiring out the group I was with, I would come home and research to learn more about the marijuana industry. I was often the first one awake and the last one asleep. I spent hours reading and writing. Cannabis had all of my attention.

My First Love, Tilray.

The first love I had was Tilray, the first cannabis IPO in the USA. Upon reading more about Tilray, I quickly learned that the company was Canadian. Interesting, I thought. As Tilray went from the $25.00 mark I purchased it at upward toward $97.00 plus; I began looking at other cannabis investments so that I could try and replicate my success. As I surveyed the other pot stocks that were available on Robin Hood (and available on US-exchanges), I noticed one strange commonality throughout all of the companies: they were all Canadian. Not that I’m saying it’s strange to be a Canadian, maybe it is, maybe it isn’t, I don’t know.

What I’m saying is that it was strange that it was only Canadian companies that were listed on American exchanges (as opposed to the American companies I saw while I was toking my way around the USA earlier this summer). Then, as I continued researching other companies in the cannabis industry, I noticed that MedMen, an American company that I had shopped at earlier in the summer, actually did have public investment opportunities. However, those investment opportunities were only available on the Canadian Stock Exchange: this is the great catch-22 of commercial cannabis, at least for now. The United States and Canada rely on one another to promulgate the growth of public cannabis investment.

I need to get my hands on MedMen, I thought to myself. But to do that I need to go to Canada. Kind of.

“landscape photography of body of water overlooking mountain range” by Tom Gainor on Unsplash

For the first time since December, I went back to an institutional brokerage account that I hadn’t touched since selling my Pure Storage stock around last Christmas after buying it earlier in the year at about $14.00. A relative had asked to borrow some money, a request I never turn down. Now I have to go back to that brokerage account to buy MedMen. The brokerage account brought me luck before with Pure Storage, maybe I could replicate it. I didn’t look forward to putting money into the account.

Depositing money into this account is antiquated. Unless you wire transfer money from your bank or request that this particular institution calls your bank to verify that you have money, you have to wait seven days for the funds to settle in the account. There aren’t any debit card options like Robinhood has. HOW is this the case in 2018 — especially for a bank with over 5 trillion in assets. I have no idea.

However, this investment bank DID have the American stocks that I wanted, which were not available anywhere else, so I waited.

After seven days, when my money finally cleared, I bought shares of 2 American companies, Charlotte’s Web and MedMen. Both are American companies, and both companies listed on the Canadian Stock Exchange.

Interweaving the North American Cannabis Industry

As interesting as the conundrum is, this catch-22 builds a framework for the North American cannabis industry that further interconnects the countries and investment networks involved. It demonstrates a strategic point of symbiosis within the investment pools and possibly the trade interests for the future of North America.

Furthermore, this (perhaps unintentional) interconnectivity demonstrates how cannabis is an industry that people want to invest in throughout the USA and Canada. Even for the people that do not want this industry to emerge, it is now too big to fail.

Several upcoming dates will further propel the growth of the industry, such as October 17, 2018, which will mark the date of legalization for marijuana across Canada. The potential upside of this market is enormous, and that is just one country.

Tides May Turn Against Long-Standing Marijuana Legalization Opponents

As the political landscape changes in Washington and certain gatekeepers that demonstrably oppose marijuana retire and fall from power, the USA’s stance toward the cash crop may change, too. However, the USA will continue to fight uphill battles until industries like big-pharma embrace the opportunity instead of opposing it.

The battles are much more relaxed now than they were when I first protested for the legalization of marijuana back in 2011 in Washington D.C. A somewhat rainy day when I marched from the Washington Monument screaming vehemently, “We’re here, we’re high, get used to it.” Now a much easier fight is ahead, but there is still a battle left to fight. Now, fortunately, the other side’s king is now only a few planned moves away.

Big-pharma and scrambled-egg-brain will not go down without a fight. They will extend the fight further, maybe to the point that they will be on our side.

Cannabis, your New National Treasure

As the United States prepares to become more independent and self-sustainable, lawmakers should treat marijuana as the national treasure that it really is. This year is a rally year for the cash crop, as cannabis is now recreationally legal in over nine states with an additional 30 states having medical marijuana programs. The industry is expected to grow from 9 billion in 2017 to 22 billion in 2022, that’s just the USA alone. The global trend for medical marijuana showed 37% growth in the first six months of 2018 alone.

The global medical marijuana industry also has the potential to establish further trade connections with European countries whose relationship with the USA is losing credibility. The USA’s alliance with Germany, a country that is on pace to become a world leader in medical marijuana after numbers soared earlier this year, can be further improved through the medical marijuana industry. The United State’s well-established medical marijuana companies that have been operating for almost a decade in some places can be a world leading market. It’s the green pasture. The last, big frontier.

In Closing

As infrastructure and trade networks transition across North America and the world, cannabis should be the cash crop that maintains the continent’s leadership and influence. Canada and the United States should continue building co-influence within this industry. The combination of investment pools from both countries can serve as a foundation of influence and decision-making as the cannabis sector becomes a worldwide enterprise over the next decade.