Not Your Grandparents’ Stock Market
Earlier in 2018, US Attorney General Jeff Sessions made a controversial move to rescind the Obama-era “Cole Memo” which created a safe haven for those state-based marijuana-related operations who were operating in compliance with the regulations of their respective states. As surprising as this move may have been at first glance, the reality is that marijuana is still illegal in the US at the federal level for both medicinal and recreational purposes. What is remarkable, however, is that despite the federal government’s rigid stance on the issue, Cronos Group just became the first Canadian cannabis stock to trade on a US exchange. Cronos’ stock is trading on the NASDAQ under the ticker symbol “CRON.” This is the first time cannabis shares have ever been listed on the NASDAQ. Cronos wholly-owns 100% of Peace Naturals and Original BC, which are medicinal marijuana and cannabis oil brands. Cronos is not completely new to the US stock exchange. It was previously a part of the first marijuana ETF to trade on a US exchange, the ETFMG Alternative Harvest ETF. Going forward, it will be interesting to see whether Cronos’ listing paves the way for once-hesitant US investors to get comfortable with the idea of putting funds into the international marijuana industry. In the US there is still stigma attached to the idea of legal cannabis because is illegal at the federal level. The Cronos listing provides a vehicle for US investors to be assured they are putting money into a foreign company that operates legally in its respective country, since cannabis is federally legal in Canada. The listing also signals opportunity to other companies who are interested in making the move into an industry that is estimated to be worth $5 billion dollars by 2019 in California alone.