A kind of hush settled over the trading world last week as institutional investors and individual traders alike waited to see whether or not the 2018 Farm Bill would be passed.
Wait, what does farming have to do with the stock market? Well, since the bill proposed full legalization of industrial hemp, it was considered a huge potential catalyst with the power to move CBD-related stock prices big time.
The Farm Bill was indeed passed last week — so what happens next? Here, I’ll talk about how swing traders can take advantage of this news, and what types of stocks to look at during this exciting time.
Recap: What is the Farm Bill and Why Does it Matter?
For traders, the biggest impact of the Farm Bill’s passing is the legalization of industrial hemp, which is a common source for CBD.
Short for cannabidiol, CBD is a compound from the marijuana plant — but unlike THC, it isn’t psychoactive. CBD has been gaining a lot of public interest for its medicinal qualities in recent years, but since it resides in kind of a legal grey zone, it hasn’t been widely available.
With the passing of the Farm Bill, CBD will now more easily be able to reach a much wider audience, which means that companies in this sector may experience incredible growth in the near future.
Farm Bill Passing: What It Means for Traders
As a trader, now is the time to be looking at CBD-related stocks.
Many CBD related stocks are experiencing price spikes right now thanks to the passing of the Farm Bill.
However, these stocks might not be just a flash in the pan. With the potential for increased sales and production, many of these companies are poised for a ton of growth in the coming months and years.
Additionally, many CBD related companies are being courted from big players in the food and healthcare industries, respectively, which could lead to even greater expansion and growth of this sector.
In a nutshell? This is news with legs, and these stocks are ready to run!
Pure Play CBD Stocks
Looking for examples of CBD stocks? Here are some stocks that are getting buzz in the sector:
On the OTCBB
Here are some top pure play CBD hemp stocks:
Charlotte’s Web Holdings, Inc. (CWBHF)
When it comes to CBD wellness products, Boulder-based Charlotte’s Web Holdings is considered one of the market share leaders. On their last earnings report, they reported revenue growth of over 50%, and that was before the passing of the Farm Bill.
With the market potentially opening up to more CBD products, the fact that they have an infrastructure in place makes this stock a tempting play.
CV Sciences, Inc. (CVSI)
Las Vegas-based CV Sciences is a company focused on developing prescription drugs with CBD as an active ingredient. Their first candidate is a drug that would combine CBD and nicotine that would help people quit smoking.
With growth during both the second and third quarters and the positive buzz around the Farm Bill, hemp companies like CVSI could be on the cutting edge of new drug development.
Elixinol Global Limited (ELLXF)
This company focuses on industrial hemp and medical marijuana. Their hemp-based offerings, including dietary supplements, beauty products, and food items, may be available to a much wider audience with the passing of the Farm Bill.
With positive and steady price action and a ramping-up of production, this is a CBD stock to look at in the sector.
NASDAQ CBD Stocks
Here’s what’s in play in the CBD sector on the NASDAQ:
Level Brands (LEVB)
Headquartered in Charlotte, NC, Level Brands is a company that helps develop brands. They do this via partnerships, product development, and operations guidance, helping develop brands in strategic ways.
How does that relate to CBD? Well, this established company recently signed a merger to acquire cbdMD, an established producer of CBD consumer products. With strong financials and no long-term debt, Level Brands is one to watch as CBD events unfold following the Farm Bill.
New Age Beverages Corp. (NBEV)
Located in Denver, New Age Beverages was founded in 2010 and produces energy drinks, kombucha, and other beverages.
Now, they’re expanding into the CBD sector, with a new line of CBD drinks on the horizon.
While the stock price had been down based on lower than expected third-quarter earnings, the new line of drinks, expanded production and distribution, and a connection to the superhot CBD sector have been turning up the heat on this stock in recent weeks.
Alkaline Water (WTER)
Alkaline Water is a distributor and seller of, well, alkaline water. Recently, they entered a partnership with American Nutritional Products (ANP) to “finalize the formulations for our Cannabinol (CBD) and infused products”.
Already boasting an established client base, Alkaline Water could be positioned for extreme growth in the future as it rides the coattails of the CBD trend.
Youngevity International, Inc. (YGYI)
This California-based company is established in the wellness sphere, with over 5500 products among its many offerings, including vitamins, minerals, herbal supplements, apparel, packaged foods, and coffee.
In 2017, the company dipped a toe into the CBD world, releasing several infused products, including coffee. With the passing of the Farm Bill, they may be set for big-time growth in the coming months.
Swing Trading with SwingTrades
These are some great examples of stocks to look at when evaluating current CBD trading action. But how can you stay updated on the best opportunities and figure out what stocks to trade?
To make the most educated decisions, you need to have a strong foundation of knowledge. This is what will help you create your own watchlists and find stocks like this before people are posting about them on the major finance sites.
SwingTrades with Paul Scolardi
My real name is Paul Scolardi, but my trading track record — plus my signature Clark Kent style glasses — have earned me the nickname “The Superman of Stocks.”
Over the years, I’ve developed a method of seeking out stocks before they reach their peak. Using this method, I’m a self-made millionaire.*
I now share my strategy and have taught 1,400 students in over 50 countries. One of my students reports making over $1 million dollars in a year and half after learning my strategy.
If you are interested in learning how to choose stocks ahead of the curve, I recorded a free video where I share my one-word secret that can unlock these massive winners. Click below to watch this free video.