Investing in Cannabis For Dummies
- Length: 304 pages
- Edition: 1
- Language: English
- Publisher: For Dummies
- Publication Date: 2021-02-03
- ISBN-10: 111967476X
- ISBN-13: 9781119674764
- Sales Rank: #189127 (See Top 100 Books)
Invest in one of the most exciting and booming industries available today
Investing in Cannabis For Dummies takes readers on an illuminating and whirlwind tour of the legal cannabis investment industry. Written by a renowned expert in the world of cannabis, Steve Gormley (also known as the Cannabis Viking), this book provides an in-depth look at all aspects of publicly traded stocks (nationally and internationally) in the cannabis industry for medical or recreational use.
This book covers crucial topics for a firm understanding of investing in the cannabis industry, including:
- How to evaluate the strength of a cannabis company
- The differences between investing in public and private companies
- Investing in different cannabis silos – from cultivation, oils, and edibles, to technology
- Avoiding common scams and traps
- Trading strategy tips
Investing in Cannabis for Dummies is perfect for those who want to get in near the ground floor of an industry experiencing a massive expansion due to cannabis legalization around North America, Canada, and around the globe.
Title Page Copyright Page Table of Contents Introduction About This Book Foolish Assumptions Icons Used in This Book Beyond the Book Where to Go from Here Part 1 Getting Started with Cannabis Investing Chapter 1 Taking the Nickel Tour Weighing the Pros and Cons of Investing in Cannabis Pros Cons Deciding Whether to Invest in Businesses That Touch the Plant or Those That Don’t Exploring Your Investment Options Starting your own business Investing in cannabis real estate Buying and selling stocks Diversifying with exchange traded funds and mutual funds Considering private investment opportunities Finding Investment Opportunities Researching Investment Opportunities Planning Your Investment Strategy Investing in a Cannabis Business Chapter 2 Exploring Cannabis Business Types Choosing Sides: Medical or Adult-Use? Investing in medical marijuana Investing in adult-use marijuana Recognizing Different Cannabis Business Types Cultivation Manufacturing Processed product brand Retailers/dispensaries Device makers Considering Ancillary Businesses Breweries Banking, payroll, and other cash management services Blockchain and other technologies Delivery services Grow equipment manufacturers and suppliers Marketing, public relations, and advertising firms Professional employer organizations Pharmaceutical and biotech companies Real estate Security services and security equipment suppliers Software companies Chapter 3 Understanding the Political, Cultural, and Regulatory Landscape Recognizing the Impact of Laws on the Industry Getting up to speed on U.S. federal law and enforcement Brushing up on state cannabis laws Considering local laws, too Examining cannabis laws in other countries Riding the Waves of Politics and Culture Checking the nation’s pulse Debunking misconceptions of cannabis and users Examining activism Tuning into cannabis culture Accounting for the High Costs of Doing Business Regulatory and compliance costs Federal, state, and local taxes Security costs Chapter 4 Sizing Up the Risks and Rewards of Cannabis Investing Weighing the Risks Falling victim to con artists Investing in an overvalued company Accounting for dilution risks Weighing the risks of potential commoditization Recognizing the possibility of changes in how federal marijuana laws are enforced Considering the impact of state and local regulation and enforcement Evaluating risks associated with obtaining banking and financial services Anticipating the impact of possible supply and demand imbalances Considering the possibility of business failure Assessing the Potential Rewards Deciding Whether Investing in Cannabis Is Right for You Considering your investment goals Assessing your own risk tolerance Part 2 Doing Your Homework Chapter 5 Exploring Your Investment Options Comparing Public versus Private Investment Options Understanding how companies raise capital Investing in private companies Investing in public companies Investing Domestically or Abroad? Investing in Cannabis or Ancillary Businesses? Buying and Selling Cannabis Stocks Going mainstream with listed stocks Bargain hunting with unlisted, over-the-counter stocks Diversifying with exchange traded funds Betting on an index with exchange traded notes What about mutual funds? Buying and selling shares of Canadian cannabis companies Investing as a Venture Capitalist Chapter 6 Digging Up Cannabis Investment Opportunities Using Online Investment Tools and Apps Cannabis Stock Trades Yahoo! Finance Morningstar FINVIZ ETFdb.com FeeX FRED The Marijuana Index Marijuana Stocks Barchart Apps Staying Abreast of Cannabis Industry News Scoping Out Opportunities in Exchange Traded Funds Finding Private Equity and Venture Capital Funds and Firms Getting Investment Leads from a Broker Chapter 7 Researching Cannabis Businesses and Stocks: Fundamental Analysis Grasping Fundamental Analysis Basics Researching Any Company You’re Thinking of Investing in Assessing the management team Evaluating the company’s financial health Evaluating startups and investments in licenses Looking at the company’s business strategy Checking out the company’s competitive position Checking any insider buying or selling Looking into warrants and convertible securities Following analyst coverage and conference calls Digging up dirt Evaluating Cannabis Cultivation Businesses Sizing up the grow master Checking a grower’s cost per gram Comparing cost per gram Considering the cultivator’s clientele Chapter 8 Analyzing Market Trends: Technical Analysis Comparing Technical and Fundamental Analysis Grasping the principles of technical analysis Weighing the pros and cons of technical analysis Combining the best of both worlds Gathering your tools Spotting and Monitoring Trends Examining different trends Gauging a trend’s length Following trendlines Looking for resistance and support Referencing Technical Charts Getting to know the different chart types Identifying chart patterns Interpreting Technical Indicators The Relative Strength Index The Money Flow Index Moving averages Moving average convergence divergence Bollinger Bands Part 3 Buying and Selling Cannabis Stocks, ETFs, or Mutual Funds Chapter 9 Choosing a Broker or Advisor Defining the Broker’s Role Distinguishing between Full-Service and Discount Brokers At your disposal: Full-service brokers Just the basics: Discount brokers Deciding Whether to Fly Solo or Consult a Broker or Advisor Finding a Cannabis-Savvy Broker or Advisor Evaluating Brokers and Advisors Comparing costs Comparing quality and service Checking credentials Comparing online brokers Chapter 10 Using Screening Tools Searching the Marijuana Stock Universe Getting Up to Speed on the Different Exchanges and Markets Browsing through the Daily Marijuana Observer’s List of OTC Cannabis Stocks Checking Out Other Stock Screeners Screening Cannabis Investment Funds What to Screen for First up: The major categories The main event: Specific filters Valuation measures Financial Highlights A Few Final Points to Keep in Mind Chapter 11 Placing Buy and Sell Orders for Cannabis Stocks and ETFs Understanding the Bid-Ask Spread Placing an Order to Buy or Sell Shares Choosing an Action Buy Sell Sell all shares Understanding the Different Order Types Market orders Limit orders Stop orders Trailing stop orders Specifying a Timeframe Day Good till canceled Fill or kill Immediate or cancel Market on open Market on close Chapter 12 Exploring Advanced Trading Techniques Buying on Margin Registering to buy on margin Examining marginal outcomes Striving for success on margin Shorting a Stock Setting up a short sale Taking a hit when the stock price keeps rising Responding when you feel the squeeze Recognizing the ups and downs of shorting cannabis stocks Part 4 Exploring Cannabis Investment Strategies Chapter 13 Following the Money: Momentum Investing (aka Speculating) Spotting Opportunities to Buy: Upward Momentum Watching for Signals to Sell: Downward Momentum Following the Smart Money Avoiding Some of the Risks Inherent in Momentum Investing Watching out for the short squeeze Steering clear of pump-and-dump scams Avoiding cannabis stock and industry bubbles Knowing when momentum investing works and when it doesn’t Chapter 14 Investing in Canadian Cannabis Companies Deciding Whether to Invest in Canadian or U.S. Cannabis Businesses The pros and cons of the Canadian cannabis market The pros and cons of the U.S. cannabis market Scoping Out the Four Leading Canadian Cannabis Companies Canopy Growth Corporation Cronos Group Aurora Cannabis Aphria Chapter 15 Investing in Countries Where Marijuana Is Legal Argentina Australia Brazil Chile Colombia Czech Republic Ecuador Germany Greece Ireland Israel Italy Jamaica The Netherlands New Zealand Norway Peru Poland Portugal Switzerland Thailand United Kingdom Zambia Chapter 16 Minimizing Risks While Maximizing Gains Staying Plugged in to the Industry Investing in the People, Not the Plant Performing Your Due Diligence Trading Cannabis Stocks on Private Markets Investing in the Biggest Markets Diversifying Inside and Outside the Industry Investing in Multi-state Operators Keep an Eye on the ETFs Invest in Innovative Companies Use Different Stock Order Types to Your Advantage Don’t Get Greedy Part 5 The Part of Tens Chapter 17 Ten Ways to Profit When the Market Drops Be Patient, But Vigilant Review Your Portfolio Cut Your Losses Buy More Shares Focus on Value Stocks Short Bad Stocks Find Potential Treasures with Bond Ratings Rotate Sectors Buy a Call Option Write a Covered Call Option Chapter 18 Ten Reasons Not to Invest in Marijuana Stocks Marijuana Is Still Federally Illegal in the U.S. Marijuana Investment Scams Are Rampant Earning a Profit as a Cannabis Business Is a Huge Challenge Illegal Operations Undermine Demand for Legal Products The Industry Is Very Fragmented Oversupply Is More Likely Than Not Bad News Is Just Around the Corner Marijuana Laws Are Slow to Change Company Shares Are Being Diluted Demand Is Unpredictable Chapter 19 Ten (Plus One) Criteria for Choosing a Cannabis Investment Experienced and Successful Management Team Steady Revenue Growth Consistent Profit Growth Comparatively Low Price-to-Earnings Ratio Positive Money Flow Indicator Expanding Free Cash Flow Operations in Other States or Countries Growing Market Increasing Market Share Positive Reputation in the Industry Manageable Debt Chapter 20 Ten Mistakes to Avoid Failing to Diversify Sufficiently Relying Solely on Online Information Not Performing Due Diligence Believing Federal Legalization Will Happen Soon Failing to Account for Regulations Failing to Consider the Possibility of Bad News Buying or Selling Too Late or Too Early Ignoring Business Fundamentals Expecting All Marijuana Stocks to Be Winners Buying a Stock Just Because It’s Cheap Index EULA
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