According to Viridian Capital Advisors’ Cannabis Stock Index, last week proved to be a successful one for publicly traded cannabis stocks. The report, outlined by Equities.com, showed that the “Touching the Plant” segment rose 33.4 percent, which outpaced the Ancillary Products and Services segment. The Cannabis Stock index outperformed the major stock market, according to the report, rising 22.8 percent for the week ending on Oct. 28.
“We attribute the rise in the Index, specifically following the end of the first half, to the anticipation of the new cannabis markets that may come online following the elections this November,” analysts wrote in the report.
Additionally, the Biotech/Pharma Sector rose 75.8 percent, and the Consulting Services sector gained 41 percent during the week.
Akin Oyedele, a Businesses Insider markets reporter, suggested that the cannabis industry’s penny stocks “are trading as of most states will say yes to legalization.”
In four days, five states will vote on legalizing cannabis for adult use, and four others will decide whether or not to implement or expand their medical cannabis programs.
The Viridian index tracks the performances of about 50 cannabis companies traded in the over-the-counter market. The companies tracked must meet certain basic characteristics, including market capitalization, trading volume and Securities and Exchange Commission filing requirements.
The Viridian Cannabis Stock Index has gained 182.3 percent in the year-to-date.
Editor’s note: If you’re not familiar with penny stocks, we encourage you to make sure you know what you’re getting into before you start investing. Watch out for pump-and-dump schemes and companies that are constantly making vague “announcements” without being able to show any actual progress, action, or clear direction forward.