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Many states have now legalized marijuana use or are in the process of passing laws to allow for the use of the cannabis plant extracts as medication, for recreation or in some states, both. Of the more than 113 cannabinoids that can be extracted from the cannabis plant, tetrahydrocannabinol, THC, and cannabidiol, CBD, are the popular ones. THC is the primary psychoactive compound in marijuana strains of the cannabis plant. It gives users a high feeling. While cannabidiol accounts or up to 40 percent of the extracts, it does not give you a high. This is because it is extracted from the hemp plant: a cousin to the marijuana plant that contains only trace amounts of THC. It is instead, capable of counteracting the psychoactivity of THC and giving relief to patients from conditions such as depression, seizures, arthritis, anxiety, psychosis and pain. This article will explore the legality of investing in stocks. Stay tuned for part two which will discuss the legality of CBD across the United States.

Legalizing marijuana for medicinal purposes is limiting in terms of consumer usage and sales growth. However, legalizing the usage of marijuana for recreational purpose is a significant move that is increasing demand and sales. The legalization of marijuana in the United States and Canada is gaining steadfast momentum. Canadian marijuana stocks are particularly gaining more attention compared to the United States thanks to its federal restrictions. However, the legalization of cannabis also comes with regulations that companies need to adhere to strictly.

Like any other venture, financiers must do their assignment before investing in stocks; especially marijuana stocks, because of the over-the-counter trading. However, the fact that the stocks are OTC-based does not, by any means, automatically make shoddy and untrustworthy. Sometimes, it’s just that OTC markets are the only avenue through which marijuana stocks can trade.

The fact that the stocks market is doing well doesn’t make marijuana stock investments a magic bullet either. It is a risky venture, and investors may be forced to be a bit more patient. They may have to take a couple of murky rides before eventually ripping the benefits.

While legalizing medical marijuana is a huge jump for investors, it is the consumer behavioral changes that are more exciting and game-changing. Consumers’ perceptions of marijuana are changing widely, increasing the potential for tremendous sales growths. The positive results include:

Strong stock market performance.

Nothing attracts financiers for a project more like its robust performance. Market performance numbers soared even higher when Canada recently legalized marijuana for recreational usage.

Steady sales growth.

Speculators are predicting a steady rise in the marijuana market based on legalization and changes in consumers’ opinions. Medicinal marijuana-based companies are likely to venture into recreational marijuana.