U.S. Investing

Cannabis Corner: Sustainable Gains

Volatility is both the delight and the curse of cannabis investing. When these stocks soar, shareholders feel more than a little giddy, but the retreats can be scary enough to make you check your nerve.

The last few months have given us both sides of that rollercoaster. Six weeks ago, stocks like Aurora Cannabis Inc. (NYSE:ACB) and Canopy Growth Corp (NYSE:CGC) were suffering and oversold.

Then the bulls came back in force. And now, once again, my proprietary cannabis index is up a healthy 5% this week.

This time, the gains don’t feel exaggerated. This might be only the middle of this particular upswing, which is probably a good moment to weigh your nerve against your attraction to the cannabis theme.

Are you here for a quick buzz and a long hangover? If so, this is a great entry point.

But if you’re here for the long haul, there really is no better time than now to add to an existing position or start a new one.

My suggestion: go small and hold on. Don’t let the market moods shake your conviction or shock you into selling before you’ve at least doubled your money.

Three of the names on my cannabis screen are in that zone right now. The group as a whole is up 44% so far this year. And across the short-term swings in both directions, I think they’re just getting started.

Hilary Kramer

Hilary Kramer is an investment analyst and portfolio manager with 30 years of experience on Wall Street. The Financial Times describes Ms. Kramer as “A one-woman financial investment powerhouse” and The Economist distinguishes her as “one of the best-known investors in America”. Ms. Kramer is often quoted in publications such as the Wall Street Journal, New York Post, Bloomberg, and Reuters. She is a frequent guest commentator on CNBC, CBS, Fox News and Bloomberg, providing investment insight and economic analysis. Ms. Kramer was an analyst and investment banker at Morgan Stanley and Lehman Brothers. Ms. Kramer founded and ran a long-short hedge fund and has been chief investment officer overseeing debt and equity portfolios. Since 2010, Ms. Kramer’s financial publications have provided stock analysis and investment advice to her subscribers. Her products include GameChangers, Value Authority, High Octane Trader, Triple-Digit Trader, 2-Day Trader, IPO Edge and Inner Circle. Ms. Kramer, a Certified Fraud Examiner, has also testified as an expert in investment suitability, risk management, compliance, executive compensation, and corporate governance. Ms. Kramer received her MBA from the Wharton School at the University of Pennsylvania and her BA with honors from Wellesley College. Ms. Kramer has provided testimony regarding investment policy to the U.S. Senate and is a frequent speaker on the markets, portfolio management and securities fraud and compliance. Ms. Kramer is also the author of “Ahead of the Curve” (Simon & Schuster 2007) and “The Little Book of Big Profits from Small Stocks” (Wiley 2012).