A year ago I set sights on the cannabis sector, stating:
Maybe once per half a century do we have an investible situation as socioeconomically unique and potentially profitable as exists presently with respect to marijuana in the United States and most of the world.
MSOX was $6.21
Two weeks later, there was news such as this:
Corporate cannabis giant to shut down facilities in Oregon, 2 other states
Curaleaf Holdings, Inc., one of the largest cannabis companies in the U.S., announced on Jan. 26 that it plans to close a majority of its operations in Oregon, California and Colorado later this month
At the same time I remained bullish, typically against the grain:
I keep adding small amounts of MSOX.
MSOX was $5.74
Since then I’ve stated repeatedly:
When a sector is so beaten down and with so many having abandoned it in frustration and losses, the upside is exceptional and often exponential.
Political winds slowly blowing in a favorable direction, though not without hiccups.
Patience, process, and prudence are paramount.
Finally in June I confirmed a “Bullish Pot Signal”:.
MSOX was $3.31
In July, “Adding MSOX”:
MSOX closed today at $3.94
I’ll scale up to a double position tomorrow.
On August 16 came this news:
Poseidon Dynamic Cannabis ETF to close as investors lose interest in marijuana industry
I noted that headlines like this are typical along a bottom, while at tops new ETFs appear. Bitcoin fans may want to keep that in mind.
As usual, the majority - among them a great many “professional” and “expert” - got it totally wrong.
The ironically-named Poseidon ETF shuttered within pennies of the sector’s low.
Two weeks later I posted “Cannabis Calling - Adding More MSOX”:
Another of America’s military misadventures may finally be coming to an end - the war on pot - as it no longer favors politicians (both “sides”) and the very long list of Drug War profiteers have greener battlefields to focus on.
MSOX closed today at $3.20
Score has since improved to i3, m3.
I’m opening an additional MSOX position at the morning’s open.
The next day, “Selling MSOX, Natgas Story Time”:
MSOX opened today at $3.74 and hit a high of $4.99
That’s a max gain of 33% intraday, 54% from the previous close, and 112% from the close 2 days ago.
Those figures underscore these statements I’ll keep reiterating:
When a sector is so beaten down, with so many having abandoned it in frustration and losses, the upside is exceptional and often exponential.
Political winds slowly blowing in a favorable direction, though not without hiccups.
Patience, process, and prudence are paramount.
Selling some for such a big, fast windfall is part of that process and prudence.
I booked an actual gain of 25%, selling at $4.67 after just a few hours of holding.
No intention to turn this into a day-flailing stock flipper blog. That’s luckily just the way it went this time.
I’m still in the cannabis sector for the long term, and if I can restore this sold MSOX position at a much lower cost I’ll do so.
Shortly after, MSOX hit a 9-month peak of $8.11, materially higher than at any time since this substack launched with a bullish call on cannabis.
MSOX then tanked, and the opportunity to repurchase much lower came in October and again in December when it traded back below $3.00
My signals remained bullish all along, but I didn’t reset the sold position.
Today MSOX hit a high of $5.93 , closing at $5.68
I’m now closing my 2nd position, purchased in July at $4.03 (noted above), booking another big and relatively quick win in this sector while markets are still afloat.
That’ll leave the initial MSOX position, at an average cost of $6.72
I’m again expecting to repurchase any added positions at a much lower price, or in a much more favorable overall market environment.
Note:
Tesla tanked 6% in after-market trading after another poor earnings report, with the company projecting “Slower Growth in 2024 as EV Demand Softens”
At its close in late trading of $195.50 it’s already down 8% from the 2nd Tesla short position opened just 2 days ago.
I might book that short-term profit if there’s a further significant sell-off soon: