There are three stages to every bull market.
The first stage is when early investors jump in.
Stocks in the sector have fallen, often for years, or it’s a new technology or growth industry few realize how big it will eventually be.
Investors who buy in are often called “crazy” for buying something that’s been left for dead or never going to happen.
The second stage is the bull market.
Word is out.
The smart money is really buying in. They’re investing in private companies for future IPO’s.
At this stage, most investors tend to buy in a bit, but never not too aggressively.
The third stage is the bubble stage.
This is the stage when early investors are sitting on fortunes. The big money is sitting on gains.
The sector is the hottest in the market. Expectations are higher than they’ve ever been.
It’s also when the “panic buying” begins and investors plow money in.
Now, we realize marijuana stocks have had a good year.
Last year institutional investors invested just over $1 billion directly into marijuana companies.
That puts us right in the second stage.
It’s not too early. It’s not too late either.
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