Trade the Cannabis index

Take a position on cannabis stocks:

  • Trade the 20 biggest publicly listed companies
  • Index weighted by market capitalisation
  • Margins as low as 5%
  • Go long or short
  • Spreads from 6 pts

Relaxed laws open up a new opportunity

There are few things investors love more than a nascent industry set for rapid growth. That’s where we are with the legal marijuana market today which enjoyed a particularly bullish start to 2021.

Our Cannabis index features 20 publicly listed companies, dominated by enterprises headquartered in Canada and trading on the Canadian stock exchange.

The index is weighted by market capitalisation and is rebalanced on a quarterly basis. Companies qualify for inclusion if they have more than 50% revenue exposure to the cannabis industry (cultivation, production of derivatives, biotechnology, commercialisation and secondary services.)

Trade the Cannabis index

Quick facts

The Cannabis index is comprised of the top 20 cannabis stocks weighted by market capitalisation, and is revised quarterly on the third Friday of every March, June, September and December after market close.

  • Number of constituents: 20
  • Market hours: 14:30 – 21:00
  • Spread: Fixed (6 points)

Smoking hot or stone cold?

Cannabis remains federally illegal in the United States, but some states have started permitting marijuana for medical and recreational use in recent years.

In Canada, recreational cannabis use was federally legalised in 2018, allowing a number of legitimate pot companies to fly high many of which went public.

These Canadian stocks are the best way for traders to gain exposure to the global expansion of legal marijuana, a market that experts see growing around 18% year-on-year through to 2027.

Our team of analysts keep an eye out for possible cannabis stock movements, so be sure to stay abreast of the news.

NEWS & ANALYSIS

How to trade the Cannabis index

Many commentators say cannabis stocks look expensive by traditional metrics. Few are consistently profitable and with some it’s too early to tell if they will be. Traders taking those views to heart may wish to sell or go short on the Cannabis index.

On the other hand, you can buy or go long in cannabis if you think there are enough factors in play to drive strong growth at the top end of the market. The Biden administration is thought to be relatively open to the concept of wider relaxation in cannabis laws.

As with all our other trading instruments, our Cannabis index charts are easily accessible on any device, and come with technical indicators and drawing tools as standard.

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