Buy stock in Texas weed
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Could Texas be the Next State to Legalize Marijuana?
The Lone Star State. A place of vast open plains and some of the best barbecue in the world. But, recent news has shown that the smoke may not just be coming from barbecues anymore. Currently, marijuana laws in the state are quite strict. The state has passed some laws for the legalization of hemp and hemp-derived products. But, this has not meant that any form of cannabis is legal in the state at this point in time.
Where Texas Currently Stands On Cannabis
With the passing of the Farm Bill not too long ago, Texas added its name to the list of states that allow legal hemp to be produced and owned. But, this in no way means that THC, the substance that gets people high, is legal. The difference between hemp and cannabis? Well, the substances are two completely different plants, but there is one key difference.
Buy stock in Texas weed
With cannabis, THC levels can be anywhere from five percent all the way up to twenty and thirty percent. With legal hemp, the maximum allowance for THC is at 0.3%. So for the short answer, there is no legal cannabis currently available in the state. This, however, does not mean that it won’t be in the near future.
Recent news is showing that one small area in Texas, could just be the first domino in the state to allow or at least decriminalize cannabis. Austin, a city known for its music and liberal population, could be moving toward decriminalizing small amounts of marijuana. This could be good for both business and marijuana stocks looking to enter into the southern market.
Big Steps Being Taken Around the State
A new resolution pushed forward by the Austin City Council, will be voted upon in the next month. The resolution would effectively end arrests and fines related to small amounts of cannabis consumption or possession. Most of this simply applies to the needlessness of arrests and ticketing for small levels of possession regarding cannabis. This is something that is being adopted in many places around the U.S., with Texas being next in line.
The only issue stems from whether or not the individual in possession of the cannabis, is distributing that product or not. But this is something that seems to be across the board. Greg Casar, a sponsor of the new resolution, stated that “if there’s no intent to sell or distribute, we’re not going to mess with it.”
This is a vastly different tone for a state that has historically been extremely conservative in regard to cannabis law. But, this could just be the defining factor to help bring to light the new state of cannabis in many conservative areas in the U.S.
What this does is it creates an atmosphere amongst pot stock investors, and citizens in the nation, that allows for the growth of the industry. If Texas moves toward legalizing cannabis, there’s no telling which state could be next. But, for now, it seems to lie in the hands of Austin, as to whether or not cannabis law can be pushed forward.
Marijuana Stocks: How to Lower Risk and Buy What’s Right for You
Marijuana stocks may seem a tempting investment, but make sure you’re aware of the associated risks before diving into this burgeoning market.
Marijuana stocks are dope, the industry’s growing like a weed — take your pick of puns, but investing in marijuana is far from a joke. With recreational marijuana legal in 15 states and medical marijuana legal in far more, this once-shady corner of commerce has become a full-fledged industry, albeit one still in its early stages.
At first blush, weed stocks may seem somewhat limited to retail operations. But once you dig a little deeper, you’ll find several subsectors within the industry, where everything from biotech and research companies to specialists in distribution and consumption operate.
All that said, it’s important to remember this is a nascent industry whose main product is still a Schedule 1 drug at the federal level. That alone makes any marijuana investment risky, but there are several other reasons why you’ll want to do thorough research before diving headfirst into cannabis stocks.
Why marijuana stocks are unique and risky
A stock’s a stock, right? Definitionally, sure: You’re buying shares of ownership in a publicly traded company. But marijuana stocks carry some additional challenges and risks, including:
- Relatively new industry. Marijuana legalization beyond medicinal purposes began in 2012. As a result, many marijuana stocks are very small, falling into the category of penny stocks, which is a risky arena for investors, especially beginners. Young companies are at higher risk of going out of business, their stocks can experience wide price swings, they may trade less frequently (making it harder to sell when the time comes) and there’s less publicly available research for would-be investors. Finally, with marijuana not yet legal on a federal level, there could be enforcement threats in the future.
- Speculative bet. For all the above reasons, marijuana stocks should be considered speculative investments at this point. Don’t invest more than you can afford to lose.
- Potential scams. Many people are eager to make money in the weed industry, including scam artists. The Securities and Exchange Commission has issued alerts specific to marijuana stocks, warning investors of potential investment fraud (unlicensed sellers, promises of guaranteed returns, unsolicited offers) and market manipulation (including trading disruptions and fake press releases meant to influence prices).
- Foreign stocks. Many cannabis companies trading in the U.S. are Canadian, and they’re also among the largest. When venturing abroad in your portfolio, there are some additional risks — there may be more limited access to financial data, such as research or company reports, than what’s required in the U.S. and potentially no legal recourse if an investment is fraudulent.
- Not yet embraced by the financial services industry. Because marijuana is illegal federally, many banks are reluctant to touch this industry. As a result, some investment professionals, such as advisors or portfolio managers, won’t be able to recommend marijuana stocks to invest in. (To purchase them on your own, see our step-by-step guide for how to buy stocks.)