⏳ Final hours! Save up to 60% OFF InvestingProCLAIM SALE

In anti-drug Sweden, investors take shine to cannabis stocks

Published 2018-03-23, 11:37 a/m
© Reuters.  In anti-drug Sweden, investors take shine to cannabis stocks
ERICb
-
HMb
-
NDASE
-
ERICAs
-
WEED
-
HELIO
-
ACB
-

By Johan Sennero

STOCKHOLM, March 23(Reuters) - Growing numbers of Swedish investors are getting a buzz from trading in listed marijuana stocks even though the country has some of Europe's most restrictive drug laws.

Shares in companies including Canadian cannabis producers Aurora ACB.TO and Canopy Growth WEED.TO and Sweden's Heliospectra HELIO.ST , which makes lighting for greenhouses that can be used to grow the plant, were the most heavily traded sector in January and February at online stockbroker Nordnet.

While private investors sold heavyweight Swedish stocks such as H&M HMb.ST , Nordea NDA.ST and Ericsson (BS:ERICAs) ERICb.ST , cannabis stocks drew in around 700 million Swedish crowns ($85 million) over the period.

"It feels like a Klondyke rush. There is a new, big market opening up," said Joakim Bornold at Nordnet.

Investors are betting on cannabis as a growth market as a number of American states, including California, legalise marijuana used in healing for at least 3,000 years and smoked recreationally -- and often illegally -- around the globe.

Canada is expected to pass a bill this summer, legalising cannabis for recreational use. cannabis trade, at least to some extent, will go from illegal to legal," said Rikard Josefsson, CEO of Swedish internet broker Avanza said.

Nearly 30,000 of Avanza's 700,000 clients bought cannabis stocks in the first two months of the year.

HARD LINE

The demand for cannabis stocks is in stark contrast to Sweden's general attitudes to drugs.

As in many countries, it is a crime to sell, buy or possess drugs in Sweden. But unlike elsewhere, it is also a crime to use them.

Swedish police can force anyone they suspect is using drugs to take a urine or blood test and users can get up to six months in prison.

While many countries consider legalising marijuana at least for medicinal purposes, the issue remains taboo in Sweden.

A recent poll showed 83 percent of Swedes against legalisation despite more liberal attitudes on other social issues in the country.

"The issue of legalisation is almost non-existent," said Camilla Waltersson Gronvall, Moderate Party social policy spokeswoman.

Many buyers of cannabis stocks see them as just like any other trade.

Avanza's Josefsson said many investors are men aged between 20 and 40, looking for high risk, high return shares. Many have also invested in bitcoin.

"This is the world of capitalism - if it is legal and I can make some money - I will invest," Josefsson said

But others like Marina Trenkoska, a 36-year-old civil servant, are hoping that trading cannabis stocks will be a step on the way to it being legalised for medicinal uses.

"I think it should be free for those who need it," she said.

"It could help so many people." ($1 = 8.2354 Swedish crowns)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.