Should We Be Investing in the CBD Industry?

As the laws and regulations regarding cannabis and its compound CBD change, so too does the financial landscape surrounding these products. The CBD industry seems poised for massive growth, with many financial advisors calling CBD stocks particularly bullish. This is an intriguing option for investors to explore. There are many options In CBD like CBD oil, CBD cream, CBD roll on stick, vape etc. Now a days CBD industry is expanding very fast.

What Is CBD?

CBD is a therapeutic compound found in hemp and marijuana. Unlike THC, this component doesn’t offer any kind of high. Rather, CBD is credited with reducing anxiety, improving sleep, lowering inflammation, and helping to treat pain. 

The Evolution of the CBD Market

The passage of the U.S. Farm Bill in December 2018 legalized CBD. Further, in July, 2020, the U.S. Food and Drug Administration approved the drug Epidiolex, a CBD oral solution designed to treat epileptic seizures.

CBD products are readily available throughout the country, everywhere from CVS and Walgreens to online stores. CBD is available in many forms, including CBD oil, CBD gummies, and CBD-infused food and beverage items like energy drinks and honey.

In 2014, consumer CBD sales were just $108 million. By 2016, this had more than doubled to $261 million. Two years later, sales had again more than doubled to $535 million in 2018. Strong growth has continued in the years since, with consumer sales of nearly $2 billion projected for 2022.

Projections for the Future of the CBD Industry

The overall CBD market was valued at $2.8 billion in 2020. Grand View Research reports that the market is expected to increase at a compound annual growth rate (CAGR) of 21.2% between 2021 and 2028. This rapid growth is likely the result of greater public acceptance of CBD and the increasing availability of CBD products.

In 2020, as the need for mental health care increased, the CBD market value for anxiety and stress applications grew to more than $1.5 billion. Research into the potential benefits of CBD is ongoing. Though there is currently only minimal conclusive evidence for some of the benefits of CBD, it’s likely that further information will be released with time, potentially increasing CBD sales further.

In July 2021, Senate Majority Leader Chuck Schumer, Sen. Cory Booker, and Senate Finance Committee Chairman Ron Wyden advocated the removal of cannabis from the Controlled Substances act. In response, several cannabis stocks went up, including Cresco Labs Inc (OTC: CRLBF), which increased 3.9%, and Curleaf Holdings (OTC: CURLF), which grew by 2.2%.

How To Invest in CBD

There are several promising CBD stocks on the market that are worthy of consideration. When deciding which stocks to invest in, consider their financial filings. Financial disclosure forms are publicly available information for businesses that sell stock. Determine whether the company makes pure CBD or synthetic CBD products. Synthetic CBD is more common in medications seeking FDA approval, whereas pure CBD has more appeal for OTC products. Getting to know the market for both will help you decide which products you’re most confident investing in.

Investing in the CBD industry now could position you to help fuel its growth and profit from the upward trends that are predicted for CBD products.