Back to top

Canada upgrades to Cannabis 2.0

Updated: Nov 7, 2019

So what is Cannabis 2.0?

Firstly you need to know that Canada passed the Cannabis Act in the House of Commons in late November 2017. The Cannabis Act legalised the use of recreational cannabis nationwide in Canada from October 2018.



Cannabis 2.0 is the second phase which has made edibles containing cannabis and cannabis concentrates legal on October 17, 2019.


Three new classes of cannabis products have become legal.

Edible Cannabis (Food and Beverages Products, Lozenges and Capsules)

Cannabis Extracts (Vaping, Wax and Oil)

Cannabis Topicals (Product applied to person, such as Lotions and Creams)


Will Cannabis 2.0 re-light the fire under the cannabis market?

The cannabis market is big and growing. According to a report from investment bank Jefferies, the global cannabis industry could be worth as much as US$130 billion a decade from now.


The size of Cannabis 2.0 is also substantial, with Deloitte having just "estimated that the annual Canadian market for edibles and alternative cannabis products is worth C$2.7 billion.”

The market has seen a phenomenal rise of all cannabis stock prices, while people predicted the potential of the new sector. This has recently been followed by a raft of the biggest companies in the sector, like, Canopy Growth and Aurora reporting much larger than expected losses and extending dates to achieve predicted profit targets, creating numerous questions.



Cannabis Stocks this year

We have seen cannabis stocks plummet this year with some of the major companies in the sector dropping over 50%. The Cannabis Index chart above provides an overview of the sector, as it provides the gross total return performance of the 20 largest publicly listed US and Canadian companies. From the peak of 1273 on the 19th March 2019 with have seen a market in freefall to a low of 517 on October 10th 2019 a decline of over 40%


But with so many companies rolling out their Cannabis 2.0 strategies there will always be winners and losers in the capture of market share.


If you like our article, please do share using any of the methods below. Thank you !

0 views

Any post is prepared for informational purpose only, with no recommendation or solicitation to buy or to sell. The background of any individual or other investor has not been considered in providing these posts. Individuals and other investors should seek independent financial advice which considers their specific risks, objectives and specific constraints, and make their own informed decisions. Individuals and other investors should note that investing in shares carries a degree of risk and the value of investments can go up or down. Past performance is not a reliable indicator of future performance.  Investments should be made with regard to an investor’s total portfolio.  Guardian Stockbrokers, its independent third party provider and its employees make no representation or guarantee with regard to any investment noted on this report, and shall therefore not be liable with regard to any loss.

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money. Professional clients can lose more than they deposit.

 

All trading involves risk.

The value of shares, ETFs and ETCs bought through a share dealing account, a stocks and shares ISA or a SIPP can fall as well as rise, which could mean getting back less than you originally put in. Past performance is no guarantee of future results.

The information on this site is not directed at residents of the United States, Belgium or any particular country outside the UK and is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

Guardian Stockbrokers Limited is authorised and regulated by the Financial Conduct Authority (No. 492519).

Registered office: 14 City Road, London EC1Y 2AA. Registered in England and Wales. Company No. 06756375.