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Cannabis Stocks Slid in premarket trading

Tiger Newspress2021-04-12

(April 12) Cannabis Stocks Slid in premarket trading. Aphria were down 8.29%. Tilray stock was falling 5.62%. Aurora Cannabis stock was slipping 1.91%.

When so many stocks in the same industry sink, there's usually a common denominator. In this case, one potential culprit is Vice President Kamala Harris' comments in an interview with the San Francisco Chronicle published yesterday. The vice president stated that the Biden administration has been too busy with other priorities to address marijuana decriminalization or other major cannabis reforms. This relegation of cannabis-related efforts to the back burner could be increasing investors' doubts that any action will be forthcoming in the near future.

Days ago, Natalie Fertig with Politico tweeted that the Treasury Department's Alcohol and Tobacco Tax and Trade Bureau has been meeting with various cannabis advocacy groups to discuss cannabis regulations. Investors could be more worried about the possibility that cannabis reform measures won't meet expectations than they are that no reform will happen at all.

So what

What does all of this really mean? Nothing.

Concerns that the Biden administration won't fulfill its campaign pledge to decriminalize marijuana are premature. After all, President Biden has been in office less than three months. Worries about what final regulations might look like if significant cannabis reform moves forward are also a waste of time. It's better to wait to see what changes are ultimately proposed.

More than anything, what we're seeing with cannabis stocks today reflects their inherent volatility. These stocks tend to swing either higher or lower on mere speculation.

You probably noticed that most of the stocks falling the hardest are Canadian cannabis producers -- Aphria, Aurora Cannabis, and Tilray. These companies are especially anxious about the opportunity to enter the lucrative U.S. cannabis market.

Charlotte's Web, on the other hand, is already a leader in the U.S. hemp CBD market. However, the company hopes to expand into the marijuana market once cannabis is legalized at the federal level.

Now what

The best thing that investors can do right now is to wait and see what happens with regard to U.S. cannabis reform. In the meantime, the U.S. cannabis market continues to expand even without changes at the federal level. Several U.S. multistate cannabis operators are already benefiting from this growth.

Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.

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Comment15

  • han1911
    ·2021-04-12
    Like and comment
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    • Jazling
      Comment back pls
      2021-04-13
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  • Daveb
    ·2021-04-12
    Or of course it might be that the last news item stated that cannabis stocks were meme stocks ... which of course they arent. They are however a hedgie target stock due to the general young age of investors who hold them. I say HODL...??✊?✊?
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  • Kiteflying
    ·2021-04-12
    Like and comment
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    • Jazling
      Comment back pLs
      2021-04-13
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  • deeplearning
    ·2021-04-12
    Diamond hands, I'm holding ??
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    • SSVC
      [强][握手]
      2021-04-12
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  • uttermehhnes
    ·2021-04-12
    APHA just missed earnings, causing the price to tank. No better time than now to load up with all of the upcoming catalysts, with the merger with Tilray the first of many. I’ll check back here in a year to see how well this ages ;)
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  • nctony
    ·2021-04-12
    Is a risk buying this share
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    • Snakekiller
      Problem is, when? 1 year? 2 years or 5 years?
      2021-04-12
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    • Asycroft
      you can buy the dip. it'll go up eventually
      2021-04-12
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  • tigerbabymoass
    ·2021-04-12
    Yo
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  • Helmix
    ·2021-04-12
    Hmm? ??
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  • mohjoejoejoe
    ·2021-04-12
    Like and comment pls
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  • GMetzidies
    ·2021-04-12
    Its more that aphria's today esrnirng report was 300% down from estimates so no surprise why this is happening.
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  • Alvinwong
    ·2021-04-12
    Like and comment
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    • JoelLim
      Sure. Please comment back on this comment
      2021-04-12
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  • bryancyh99
    ·2021-04-12
    Lost? 
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    • Helmix
      Terrible
      2021-04-12
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  • ZhenYangx2
    ·2021-04-12
    Like and comments thanks
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  • Johnwinnie
    ·2021-04-12
    Oh no..
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  • BigRobin
    ·2021-04-12
    Sell the news 
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    • BigRobin
      ??
      2021-04-14
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    • BigRobin
      ?
      2021-04-13
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    • RBeaver
      Ye
      2021-04-12
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