The Controlled Substances Act at the federal level in the US still declares marijuana as the Schedule 1 drug. The north part of the world might try to legalize this drug with sales from October this year, it still is unpredictable. It is even a hot topic in the world of stocks and legalization of cannabis could be really a plus for the marijuana-linked companies.
Recently, Oklahoma became the 30th stated for voting in favor of legalization of marijuana for medical usage in June 2018. There are many stocks which have risen their scope with Marijuana legalization for medical usage. These cannabis stocks are based in different modes and have the business models having a wide scope for the progress. The penny stock investors must read the guidelines properly to make the right choice. The investor relations and the company’s activities have to be considered as the primary elements in making the right choice.
The investors are required to do their homework before making a choice to invest in any marijuana penny stock. This would be a hard decision as there are many companies trading in PTV markets with fewer disclosure documents and no proper transparency. It can be difficult to attain the source information and details about the company as it doesn’t show its information in detail. The investments are young and the industries have not reached the mainstream position.
Any company on OTC markets don’t reveal that the company is not worthy. There are many groups in the OTC markets having a good presence and do well in the long run. There might be some names in the New York Stock Exchange trading having the less than stellar names. The main issue with marijuana penny stocks is that the chances of fraudulent cases are more than the major stock exchanges. It is due to the non-transparency of the stock analysis and company’s information on the public platforms.
Taking an example of the Nasdaq listed group INSYS (Insys Therapeutics), Arizona. This pharma group was betting on cannabinoid oil-based drug for the treatment of the people suffering from AIDS and cancer. The drug was meant to control loss of appetite, nausea, and vomiting caused due to the heavy medication used for anti-cancer, chemotherapy and AIDS medication. The company’s drug Syndros got the FDA approval in 2016. The stock price in 2015 was $44 and it came down to $4 in 2017. This happened due to the company’s executives attaining charges of offering the kickbacks to the doctors to prescribe Subsys.
There is another example of TGOD (The Green Organic Dutchman Holdings Ltd.) having a rise in the stocks of 57 percent since it began its trading (May 2, 2018). The fact is that this company has no revenue generated. The investors need to decide on investing in every penny stock or major stock exchange group by making an in-depth research about the same. The growth of penny stocks is unpredictable and investments have to be tackled in a way to earn profits.