There are many recent developments that have a positive impact on the cannabis market. Large-scale legalization and regulation in America is generating optimism in the market.
A statement released this week by US Senate Leader Chuck Schumer and two other Democratic senators is pushing for another green wave. They want to work towards federal legalization as quickly as possible.
This trend "gives investors a sense that more institutional money will enter the industry soon," Tim Seymour, Seymour Asset Management's founder and chief investment officer, told CNBC's “ETF Edge” this week. That's great news for cannabis companies operating in states with some degree of legalization. Notably, Curaleaf, Green Thumb Industries, TerrAscend and Cresco Labs, said Seymour, who runs the Amplify Seymour Cannabis ETF (CNBS). It also benefits Canadian cannabis giant Canopy Growth.
Developments in the cannabis market
New York could also be a major catalyst for the market. Governor Andrew Cuomo is pushing for legalization over New Jersey's switch to recreational use, Seymour said. "New York is kind of pivotal to 'adulthood' across the East Coast," he said. Letting US investors quote directly on domestic exchanges would be a big step forward. That would pave the way for wider investeringen and more public debuts. ”
“Over the next six months, it is expected that more capital will enter the sector, as it can now be invested by institutional players. Bankers will help bring more capital into the sector, ”said Seymour. More mergers, acquisitions and consolidations are also likely to take place over the next six months. The cannabis deal calendar looks very exciting for the next three to six months, ”he said. On Wednesday, Jazz Pharmaceuticals announced a $ 7,2 billion deal to purchase GW Pharmaceuticals for its cannabis-based epilepsy treatment.
It's likely just one of many strategic deals investors will see in the space this year, according to Seymour.
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