Tuesday Risk On


Stocks resumed their recent risk on rally with strength in international, emerging, small and micro cap stocks. It is interesting to see strength in the technology sector despite the drubbing in price for micro-blogging site, Twitter. The S&P 500 closed the day nicely with a gain of 1.19% to 1985.

Cannabis indices failed to participate in the strength in micro cap stocks today as both MJIC Marijuana Index and Benzinga 420 Marijuana Index declined by 1.27% and 5.17% respectively.

Daily Positive: CannLabs (OTCQB: CANL) opened its Connecticut laboratory today. We see testing as vital to both consumers and regulators as this market continues its transition into a legitimate industry. We are interested to see how the business metrics unfold in the testing marketplace.

Daily Negative: The volume and activity in the sector seemed disproportionate to the activity in the broader markets.

The Las Vegas licensing hearings are being held today, and so far, the process has gone well. Showing that operators are preparing appropriately and that opposition is not as intense as once predicted. It will be interesting to see how this all nets out, as Las Vegas is a merging of all markets in many ways, with tourists coming from all regions. They are the first state to have medical card reciprocity, making it easy for out-of-staters to participate when visiting. This is a tremendous opportunity for investors.

Additionally, the cannabis industry is being represented by a panel at what is usually a very traditional financial conference. Emily Paxhia of Poseidon Asset Management, Troy Dayton of The ArcView Group and Josh Rosen of 4Front Advisors will be addressing family offices, hedge funds and private equity investors at the Opal Family Office Private Wealth West Conference. It is great to see attention being paid to the industry and it is encouraging to see the interest from these broader based investors. We are noting that investors outside of the sector are viewing cannabis as a new investable asset class.


The discussion above is provided for informational purposes only and does not constitute an offer of, or solicitation for, any investment services or products offered by the author. The author is not making any investment recommendations and the opinions above do not constitute investment advice. Reference to above indices [and companies] is based on information provided by sources the author believes to be credible. Investing in the cannabis industry, as with other industries, presents certain risks including the risk of loss on an investment.

Morgan is a Founding Partner and Managing Director of Poseidon Asset Management. He is the Chief Investor of their Cannabis Focused Fund. Morgan previously worked for a privately owned Registered Investment Adviser and earlier was at UBS Financial Services focusing on wealth management. Morgan believes in the potential of the cannabis industry and likes having an active involvement as it develops. You can follow him on Twitter @PoseidonAsset.

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