Cannabis Stocks Increased During Downward Trend, Investors Locking In Gains

When the cannabis stocks fell on Friday as a result of the broader market dropping, investors pulled out fast to keep their gains. With so many significant stocks dropping, it only makes sense that these investors would want to lock in their new gains in the cannabis sector.

Dow Jones Industrial Average dropped more than 400 points following weak data coming from Germany and the U.S. because of global growth fears. Investors left the stocks fast, resulting in an inverted spread between the three-month Treasury bill and 10-year note for the first time in around 12 years. The worry is that a yield-curve inversion is a predictor of an economic decrease.

Fortunately, the market in 2019 has been rather strong. Jason Wilson, one of the partners at ETFMG Alternative Harvest ETF, is quoted as saying, “As earnings continue to trickle out, people are waiting to see what the next movement is — there has been strong revenue growth. There’s been a lot of back-and-forth questions about whether valuations are getting lofty again. Last week we had some good, positive movement. And when we get these upward spikes, we tend to see some pullback.”

There has been a lot of action to cause cannabis stocks to grow as well. The state lawmakers in Connecticut had two separate meetings regarding bills to legalize the plant and expand on the state’s medical program.

If these bills pass, adults 21 years old and older will be allowed to possess, consume, and buy marijuana recreationally.

MedMen Enterprises Inc. avoided the downward trend, trading up 6% following the company’s agreement with funds managed by Gotham Green Partners. This investment has allowed them to secure a convertible credit facility of as much as $250 million.

Curaleaf Holdings Inc. also bypassed the downward trend, gaining 32% in value. This followed its announcement that CVS drugstores will be selling their CBD products in eight states.

With these companies boasting such impressive gains amidst the chaos, how high will these cannabis stocks grow?

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