The hemp industry is just beginning to blossom, and finding the best hemp stocks to buy for your portfolio could put you in a position for long-term gains. What’s the story behind this plant that was, until a few years ago, deemed illegal?
Hemp is a fast-growing plant with a number of industrial uses. You can make paper, clothing, rope, textiles, and paper with it. Of course, the big news with hemp these days is the cannabinoid oil, or CBD, derived from the plant. We’ll get to that in a moment, though. First, let’s talk stocks.
Investors interested in long-term gains in a burgeoning industry may find that good hemp stocks to buy and hold can be a profitable venture. Many investors like that global production and usage is on the rise, especially as more uses for hemp are found. From supplements and medicine to industrial uses, the growing acceptance and usage of hemp is a main reason why investing in hemp can help fuel some diversified portfolios.
Why is hemp so popular?
One reason to look for good hemp stocks to buy is the growth within the industry. The 2018 Farm Bill made hemp legal in the United States on the federal level. This bill also allows states to develop their own industrial hemp programs. This ultimately made it legal to transport hemp and hemp products across state lines. It has also allowed for great sales opportunities stateside and abroad to countries where it is also legal.
Another big reason to consider hemp stocks is the growth of the CBD market. CBD, also known as cannabidiol, is one of the many cannabinoids found in the hemp plant. This constituent has gained a lot of attention because it appears to have a variety of health benefits, like the ability to prevent seizures, without any sign of public health-related problems. In fact, the FDA even approved a cannabis-derived medication called Epidiolex, which has CBD in it. Other conditions that CBD may be able to help include anxiety, insomnia, and chronic pain. You can find CBD in an array of foods, supplements, tinctures, and topical creams.
Furthermore, the market potential for hemp is massive. Not only is CBD in foods, supplements, and medications, but there are many other industrial uses for hemp that make the stocks potential even greater. That’s in addition to the industrial applications already mentioned. This billion dollar global industry is poised to grow even more.
Characteristics of the top hemp stocks to buy
Major companies are already getting involved with CBD and there are profitable hemp companies currently in existence. Major retailers like Krogers, Walgreens, and CVS are all starting to carry hemp products in their stores. There is little wonder that the global market is expected to reach over $10 billion by 2025.
Hempco is an example of one profitable hemp producer. This company also has hidden assets, as the management talks of investing in their internal research and development, as well as new proven technologies.
The types of hemp stocks to buy are ones with strong management, a history of sales and preferably profits, one that focuses on multiple products, and has assets in research and development. Also look for a balance sheet that you feel confident in. Investing in hemp ETFs can be a smart move because they provide for diversification within the hemp industry and can protect against risk.
Investing in top hemp stocks can help a diversified portfolio experience long-term gains, especially if the investment involves a company or companies (when investing in ETFs) that operates within multiple financial sectors.
Is investing in a hemp a long-term strategy of yours? Do you find it more beneficial to invest in hemp over legal marijuana?