There are two main reasons why institutional investors (banks,pension funds,mutual funds) can't invest in cannabis stocks:
Federal illegality: Cannabis is still classified as a Schedule I drug under federal law in the US, despite legalization for recreational or medical use in many states. This creates a conflict for institutions that are federally insured or regulated.
Banking restrictions: Because of federal law, it is difficult for cannabis businesses to use traditional banking services. This makes it challenging for institutional investors to hold these stocks in their portfolios.
Both of these things are about to change. With SAFER banking and new SAFER-lite in the spending bill, banks are about to jump on to cannabis before the next rounds of legalization catalysts and CAGR pumping above 25%. Cannabis about to get uplisted, with some companies working on workarounds like teaming up with beer companies.
Federal legalization is changing too. Biden and Harris are already in talks, and with the dea rescheduling to S3, things are excelerating there as well.
Retail has behaved emotionly with cannabis stocks, spiking prices with each catalyst and the price gets suppressed and shorted down with low volume. This time, at these oversold floors, Retail has the chance to accumulate and hodl, getting in at the start of the rocket and an exponentially growing cannabis industry, before hedge funds and institutions can get their discount.
$MSOS and $MSOX
Current position: MSOS calls 6/21
Very low put call ratios and decent options volume at 6/21
MSOS has retail advantage over institutions this election year
byu/andrewbiochem inoptions
Posted by andrewbiochem
1 Comment
Retail getting in early, institutions will follow, huge upside potential in $MSOS and $MSOX