Cannabis goes to pot?

As the economy lumbers slowly back into motion after the annual visit to the fleshpots of the coast, many will have used the holiday season to set a few goals for the year ahead. Traditional favourites include regular exercise, abstention from vices of all shapes and sizes, and ruthless application to the ascent of the corporate ladder.

However, the crafty investor might consider ways to ensure the peace and relaxation of the holiday spirit permeate the rest of the year as well.

Those fortunate enough to live in the more enlightened states of the US can now indulge legally in herbal products to maintain the high of the holidays, and investors can liven up their portfolios with exposure to the likes of the Alternative Harvest exchange traded fund, which invests exclusively in stocks related to the cannabis industry.

The fund has attracted rapid inflows since recreational sales kicked off in California, and 41% of its portfolio is in Canada-based companies, as the legal framework in the land of the Mounties is positive and well-defined.

The situation in the US is a little more wobbly, however, and cannabis stocks took a pounding when the justice department revoked a ruling that allowed states to set their own policies on recreational use.

This may have caused many a wannabe weed entrepreneur to get properly stuck into his own product, and investors may be concerned that the industry attracts enthusiasts rather than devotees of the profit margin.

It’s clearly a market with potential, but there may be a few false steps on the way to Nirvana.