Over the past month, shares of exchange traded fund (ETF) Horizons Marijuana Life Sciences ETF (TSX:HMMJ) have increased by more than 10%, and investors are growing increasingly bullish that the Canadian cannabis sector could potentially have another parabolic surge in mind as the weather becomes nicer and we inch closer to legalization in Canada.
The Canadian cannabis sector has become a hotbed for early-stage investors to get involved as speculators look for a hot sector to invest in. While most major publicly traded cannabis producers now sport equity valuations north of $1 billion, mainstream investment has brought many of these producers out of the venture indices and into the limelight, with some companies choosing to list outside of Canada as well.
For investors looking to capitalize on the sort of growth trajectory early cannabis investors are continuing to hope for, buying shares in an ETF like HMMJ is certainly a decent way to go, given the fund’s rather diversified approach to picking stocks (this ETF holds most major cannabis producers as well as secondary and tertiary businesses which stand to benefit from the rise of the cannabis industry as a whole).
With the cannabis sector still in its infancy, concerns about picking a “winner” in a sector filled with uncertainty are real, and investors choosing to spread some of the sector-related risk around may be served well by looking at vehicles such as this ETF over the long-haul.
Invest wisely, my friends.
