Cannabis investors recently saw a jolt of optimism after President Donald Trump signaled support for covering CBD oil under Medicare. With the news, stock prices soared.
A few of the companies that saw their stock prices soar up to 36% after the news include Green Thumb Industries, Curaleaf Holdings, Innovative Industrial Properties, Tilray Brands and Canopy Growth. (1)
All of this growth came after The Commonwealth Project released a video touting the benefits of CBD oil for seniors. Subsequently, Trump shared this video on Truth Social, a signal of support. (2) But somewhat uncharacteristically, he didn’t add any commentary in his post; he simply shared the video.
Back in August, Trump shared that he was considering reclassifying marijuana as a less dangerous substance. (1) But, so far, nothing official has moved forward that would reclassify marijuana and potentially open the door to more prevalent use in the medical industry.
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The future of CBD still uncertain
The video’s narrator states, “it’s time to educate doctors on the endocannabinoid system, provide Medicare coverage for CBD and give millions of seniors the support they deserve.” It also highlighted Trump’s role in signing the 2018 Farm Bill, which helped open the door for production and sales of CBD across the country. (3)
Trump shared a video that proclaimed the benefits of CBD oil. But, notably, he didn’t say anything about the contents of the video. Instead, he shared it through Truth Social without any additional commentary.
Many may rightly see this as a sign of support for covering CBD oil under Medicare, which pushed CBD stock prices higher. But the president hasn’t explicitly stated anything that would indicate this is his goal, and more pressingly for investors, there’s no firm timeline.
It’s critical to remember that nothing is finalized. Any political or legal challenges could derail the industry’s progress, which means investors cannot assume smooth sailing anytime soon.
Unfortunately, the lack of clarity means that investors cannot know for sure that this signal from the president means they can relax. With that, it seems likely the stock prices in the cannabis industry will remain volatile for the foreseeable future.
Read more: How much cash do you plan to keep on hand after you retire? Here are 3 of the biggest reasons you’ll need a substantial stash of savings in retirement
Should you add CBD stocks to your portfolio?
Volatility in the stock market isn’t a new phenomenon. It can impact almost any industry. But some sectors, like tech and consumer discretionary, seem especially prone to market volatility.
Most investors expect market volatility in their investment journey. Recently, a Gallup survey found that 73% of investors expected market volatility to persist through the end of 2025. (4) Although that survey covers the market in general, it does shed light on the fact that dealing with volatility is a part of being an investor.
One way to deal with volatility is to craft an investment portfolio with the long-term in mind. Buy-and-hold investing isn’t necessarily an exciting strategy. But it’s an option that works well for many investors.
If considering adding CBD stocks to your portfolio, buying and holding for the long term might be a good idea for investors who believe in the future of this industry.
When opting for a long-term approach, consider opting for an ETF instead of buying into individual companies. The right ETF will help you gain exposure to CBD without putting all of your eggs into the basket of a single company. Some possible ETFs to consider include AdvisorShares Vice ETF (VICE) and Cambria Cannabis ETF (TOKE).
Depending on how things play out, buying into the industry now could pay off in the long run. But as with all investment possibilities, only time will tell.
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Article sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
New York Post (1); Truth Social (2); Congress.gov (3); The Hill (4)
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.