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Economy , Investing , Lifestyle


May 24, 2019

That’s the opportunity in the cannabis industry right now – it’s an arbitrage play. On one side of the fence, you have government laws. On the other side of the fence, you have a landslide of momentum and support for the green plant.

Is it a stretch to call investing in cannabis an arbitrage opportunity? Based on the exact definition of arbitrage, yes. However, from an investing perspective, there is an actual arbitrage in the cannabis industry simply because of government laws and social perception.

In economics and finance, arbitrage is the practice of taking advantage of a price difference between two or more markets: striking a combination of matching deals that capitalize upon the imbalance, the profit being the difference between the market prices.

Globally, more than a quarter billion adults consume cannabis at least once a year, collectively spending $344 billion each year.

Source: NFD

Many countries and US states have completely legalized the recreational consumption of cannabis, just like drinking a beer. There are dozens of former politicians and highly respected CEOs who currently work for cannabis companies. Tax revenues have skyrocketed in locations that have legalized the plant. 

Most importantly, public support for the legalization of cannabis has surged to an overwhelming number. Two out of every three Americans are in favor of legalization. 

And get this… every single group of people determined by political party affiliation, age group, and location poll over 50% in favor of legalization. That means over 50% of Republicans, over 50% of those 55 and older, and over 60% of all regions in the US are in favor of making marijuana legal (all of those groups have traditionally voted against cannabis).

Source: Gallop

That is incredible. There are very few things in our world that have such a high approval rating. Yet, despite this overwhelming opinion, most governments throughout the world still classify cannabis as one of the most dangerous drugs on the market. 

Currently, nearly every single state in the US has a cannabis related topic on the next ballot. Internationally, the trend is the same, with 68(!) countries currently legalizing or not enforcing cannabis laws.

I bet that in ten years, we’ll look back on this era of cannabis prohibition and think to ourselves, “What the hell was that all about!?”

Actually, I am literally betting on that. We’ve invested in a variety of different cannabis companies. Some that touch the plant and some that provide ancillary services. You can see an abbreviated portfolio of companies we’ve invested in here.

You can make that bet too, even if you have no idea what the cannabis industry is all about. The first step is to just learn about the plant. Take a very simple approach and just go buy some cannabis. (Gasp!)

And to make it even easier you can buy a CBD product, which is the non-psychoactive part of the cannabis plant (it won’t make you high).

One of our portfolio companies, Heally, allows you to do just that. You can buy CBD products online and have them shipped to your door (you don’t need any special license or anything like that). 

Of course, if you want the real stuff, Heally can also get you your medical marijuana card.

I’ve arranged for a 20% discount for anyone, as long as you use the code “EXPLORER” at checkout. Just go here to shop.

If you’re already a cannabis pro and don’t need to buy anything, why aren’t you looking at investing in the industry? Get in contact with us, if you’d like to start.