Marijuana is the dried flower of the naturally occurring cannabis plant, that’s existed on the planet for thousands of years and has been widely used through history by various cultures. The first-ever recorded use of the plant for medical reasons dates back to 2,737 BC in China when Emperor Shen Neng began exploring its potential benefits, yet it’s medical benefits are only today truly being considered once again, after nearly decades of prohibiting its usage both medicinally and recreationally. It’s led to a booming market for investors seeking to profit from the next big thing.
The eons-old plant has recently become a topic of conversation alongside an extremely new, emerging, and potentially world-changing technology: Bitcoin, and cryptocurrencies. While one is completely natural, occurring from the planet, the other is computer code designed by a mysterious human named Satoshi Nakamoto – whose true identity remains shrouded.
Both Bitcoin and the budding – no pun intended – the marijuana industry have both provided investors with a wealth of opportunity this year thus far.
Introduction to Pot Stocks and Marijuana Market Trading
In fact, there are only a small amount of publicly listed pot stocks, including the ”Big Four:” Canopy Growth, Aurora Cannabis, Cronos Group, and Tilray.
Additional companies are emerging as penny stocks and through OTC markets, but these markets often are viewed by some investors as unnecessarily risky or unsavory. Like cryptocurrencies, there are risks involved with investing in new companies or startups, and the failure rate of startups is high.
Due to the speculative nature of these startups, these assets are highly volatile and offer traders falling and rising prices to capitalize on. Traders can earn from any trend: up or down, making pot stocks exceptionally lucrative.
Introduction to Trading Bitcoin and Cryptocurrencies
Bitcoin was created as a peer-to-peer cryptographic cash system, designed to remove the control that governments and banks have over one’s money. It’s creation sparked the birth of an entire industry and thousands of cryptocurrencies like it.
But it’s not just Bitcoin and the crypto assets themselves investors are betting on, it’s the blockchain technology underpinning these cryptocurrencies that has investors so interested. Nearly every industry has the potential to be forever transformed by these emerging technologies, and it poses a unique opportunity for investment.
Like pot stocks and startups, crypto trading can be high risk, so much due diligence and research is necessary on the investor’s and trader’s part. However, the volatility that cryptocurrencies offer creates an enrichment for substantial profits.
Bitcoin and Crypto Versus Pot Stocks: Which Performed Best in 2019
Both asset classes have been the talk of the investment and trading world over the last few years. The pot industry is booming and the crypto industry is only getting started.
While 2017 was the year that put Bitcoin and cryptocurrencies on the map, 2019 has been almost as lucrative. In early January, Bitcoin traded in the low $3,000 range where it found its bear market bottom. Once traders realized the bottom was in, and that Bitcoin was once again climbing high, it went parabolic before it was stopped at $13,800. The rise represented over 300% gain for Bitcoin.
During the same time, Litecoin also found a bottom at roughly $20 and went on to increase over 500% to $140 before falling back down.
Cryptocurrencies like Bitcoin reached valuations of $20,000 in the past and is highly likely to beat past all-time high prices in the future.
Pot stocks, however, have underperformed in 2019. Performance shows that most of the major pot stocks are at six-month lows, and have declined as much as 20% throughout the start of the year. However, assets that are falling in prices also can present an opportunity for short-selling, which means they can be equally as profitable to traders during downtrends.
Advanced trading platforms such as PrimeXBT, offer the ability to short-sell and go long on assets, and offer a wide range of cryptocurrencies, commodities, stock indices, and more. PrimeXBT and others also offer up to 100x leverage on trading, which allows traders to take full advantage of the wildly volatile price swings in these speculative and emerging asset classes.
Pot stocks, like cryptocurrencies, are still very young as an investment vehicle and will take many more years for each market to fully mature, and present the returns investors are hoping for. The fact that both have performed extremely well, yet have experienced corrections are normal market cycles and behavior. But their speculative nature lends well to volatility, and make them the best option for traders.
Timing the tops and bottoms of each market, as well as trading the rises and falls is the best strategy no matter which asset you invest in.