As New Jersey approaches what could be a defining moment for the legalization of recreational marijuana use, investors are renewing their interest in the potential profits of cannabis growers, traders and so-called cannabis-related companies.
New Jersey is one of four states whose voters will decide next month whether to legalize marijuana for recreational use; others are Arizona, South Dakota and Montana. And if cannabis gets the green light in Garden State, it will dramatically increase pressure on Pennsylvania to do the same or lose windfall tax revenues during tough financial times.
A surge of optimism followed months of stock market ups and downs – a pun inevitable – for state-owned marijuana and CBD firms. After an oversaturation in Canada earlier this year and a lack of funding, the share prices of most of the leading firms have plummeted.
“The cannabis industry has been in a bear market for about 25 months,” said Emily Paxia, managing director of Poseidon Asset Management, a cannabis-focused fund with $145 million in assets. Her foundation mainly funds private companies and also tracks government-owned cannabis firms. “We’re watching very closely,” said Paxia.
But strong demand during the coronavirus isolation in the United States made a difference, surprising industry veterans. “It pushed everything to a new norm,” said Paxia. – People are lighting houses. They increase consumption, travel less often. ”