Cannabis and coronavirus – seemingly unrelated but maybe more closely connected than we think. Now considered a pandemic, COVID-19 has reached 100 countries and infected more than 125,795 people. So, what does this have to do with cannabis? Well, like the economy as a whole, pot stocks will also take a hit—unless you see the tiny sliver of a silver lining, where they might actually get a much-needed boost.
So, get out your hand sanitizer, pack your vape pen, and put on your facemask; let’s take a look at cannabis and coronavirus—and how pot stocks are impacted.
‘A Rising Tide Lifts All Boats’
There’s a saying that when things are good, they’re good across the board. When they’re bad, like they are now, very few players are able to truly thrive. And to be honest, cannabis stocks weren’t doing so great before COVID-19 started gaining more attention. So, when the market as a whole started to take a nosedive, this was just an added burden for the already-vulnerable marijuana stocks. As of the time of the article being written, average cannabis stocks are down 76% from their 52-week high. Many investors are coming to grips with the fact that this global pandemic will have a negative impact on the global economy—pot stocks included.
A connection that may not be as apparent is the control of the spread of the virus. China’s making a lot of efforts locally—but they are affecting cannabis stocks around the world. Coronavirus started in China and, at this point, the country has been affected more than anywhere else. The Chinese government has been taking measures to contain the virus, which is potentially troublesome since many Chinese-made products end up everywhere around the globe. Where is the connection between cannabis and coronavirus? Well, most vaporizers and product packaging are made in China. If exports are down, so are the stocks that rely on these products.
It’s Not All Bad News
When stock markets are suffering, cannabis companies have a difficult time accessing sometimes very much needed capital. In fact, it’s looking like some marijuana firms may go under. When prices drop, however, it may be a good thing for some investors. For those who want to get in on pot stocks, and do so cheaply, now could be the best time.
Some analysts are even inspired by the current outbreak and the anxieties it’s producing. Where alcohol consumers typically like to drink in a large gathering, cannabis consumers prefer to smoke alone, or in a smaller group. If we’re all self-quarantining, we might be enjoying more marijuana—a very happy thing for pot stocks.
We hope this gives you a bit of insight as to what’s going on in the world of pot stocks, and how the recent pandemic is impacting it in a variety of ways. If you’re an investor or thinking about getting into the marijuana stock market, we hope that you were able to find some good news in this article. If not, stock up on non-perishables, stay in tonight, light up a joint, and do your part to support the cannabis industry.