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The cannabis index


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I like the idea of having a cannabis index.  So I had a look at the chart and found a gigantic green candlestick hanging in mid-air thousands of points above all the other days' prices.   Does anyone have an explanation for this behaviour?  Is this a safe index to 'invest' in?

 

 

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Hey folks. The new Cannabis index offered by IG has only just been launched and therefore we haven't kicked off any marketing or promotion at this point in time. We have it scheduled in though so we'll make sure all relevant clients are aware of our offering and provide all educational and informative material. 

Thanks for notifying me of the chart spike. Charts are indicative and it looks like this was a miscellaneous print which we will investigate. I've spoken to the trading IT team and they've gone and manually removed the incorrect tick. This should update on your charts shortly. Apologies but thanks again. (NB: any orders, limits, stops etc wouldn't have been triggered off an indicative charting spike.)

The Cannabis index itself:

  • The Cannabis Index captures the Gross Total Return Performance of the 20* largest publicly listed US and Canadian companies with direct revenue exposure to the cannabis industry.
  • The index itself cannot be traded in the underlying market (hedging will be done in the constituent stocks), therefore we cannot work orders in the index, but are happy with OTC orders to open.

Weightings (subject to change but correct at point of posting)

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As a side note: When it comes to Cannabis, individual stock can no longer be bought, but this only applies to Share Dealing accounts (however you can sell to close). You can still buy or sell individual Cannabis stock on leverage (as below). 

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On 08/05/2019 at 05:42, Caseynotes said:

That's interesting, not seen that before. So IG are taking away individual cannabis stocks but have an index instead. I don't know about 'safe to invest' in but seems workable to speculate on though the chart has many spikes and gap traps.

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They have Cannabis companies like Aurora, Tilray ecc.

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  • 3 weeks later...
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Diageo boss says cannabis no threat to booze (which causes tens of thousands of deaths, while cannabis causes zero): 

Diageo Cfo Says Monitoring State Of Cannabis Market "Pretty Closely"; No Impact On Co's Beer Or Spirit Business To Date From Cannabis - Reuters

Totally moribund industry ...

88% of clients long ... those poor souls hanging on for dear life ...

Painful ...

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"Aphria’s market-beating Q4 results last Thursday sent its share price up more than 40%. The Canadian cannabis producer announced a surprise profit of $15.8m, putting it in a good position to acquire assets from its beleaguered competitor CannTrust, which CEO Irwin Simon confirmed the company is “absolutely” interested in acquiring. The news had a positive knock-on effect for other stocks in the space, with the two best-funded Canadian cannabis plays (Canopy Growth and Cronos) having seen their stocks rise 5% and 8% respectively since Thursday’s close."

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52 minutes ago, Guest phil said:

"Aphria’s market-beating Q4 results last Thursday sent its share price up more than 40%. The Canadian cannabis producer announced a surprise profit of $15.8m, putting it in a good position to acquire assets from its beleaguered competitor CannTrust, which CEO Irwin Simon confirmed the company is “absolutely” interested in acquiring. The news had a positive knock-on effect for other stocks in the space, with the two best-funded Canadian cannabis plays (Canopy Growth and Cronos) having seen their stocks rise 5% and 8% respectively since Thursday’s close."

 

Cannabis stocks were swinging up and low like crazy last year.  Does that mean the cannabis index will display similar 'bipolar disorder'?

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Hammer on the hourly chart and this, "In the U.S., sales of CBD products for all species are approaching US$500 million, reported David Lummis, lead pet market analyst for Packaged Facts, in a column in (https://www.newsfilecorp.com/redirect/VBKgUeEk)Pet Product News (https://www.newsfilecorp.com/redirect/zDZ5uoVe). Citing data reported by the Washington Post, he said those sales are projected to soar to as much as US$22 billion by 2024."

Why bother trading?

Just buy and hold.

Edited by dmedin
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I decided to exit (with about 40p profit) as even although there is a strong hammer-like signal there, it is still in the doldrums and basically ****.  Mind you, a punt at 50p per point with a nice deep stop wouldn't be a terrible idea.  Just treat it like an investment and check on it once a month.

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