Rumor circulating (at least from my front page) on the Marijuana bill going through congress early next week:
Starting this thread up for stocks/etfs etc. that may be affected (possibly buy the rumor, sell the news type of thing).
Not familiar with this sector - just initiating for discussion. Feel free to add / recategorize.
$LFLY (MCMJ)
$CGC
others: $CURLF, $TLRY, $CRON, $ACB, $SNDL
“The U.S. House of Representatives plans to vote on a bill to federally legalize marijuana for the second time in history next week, congressional leadership confirmed on Thursday.
The body will take up the Marijuana Opportunity, Reinvestment and Expungement (MORE) Act, a bill sponsored by House Judiciary Committee Chairman Jerrold Nadler (D-NY).”
This is a floor vote in the House of Representatives.
"The Senate on Thursday unanimously approved a marijuana bill—but not the federal legalization measure that advocates have been eagerly awaiting Senate Majority Leader Chuck Schumer (D-NY) to bring to the floor. Rather, it’s a modest bipartisan piece of legislation that’s simply meant to promote research into marijuana.
The bill—sponsored by Sens. Dianne Feinstein (D-CA), Brian Schatz (D-HI) and Chuck Grassley (R-IA)—is titled the Cannabidiol and Marihuana Research Expansion Act. It cleared the full chamber unanimously, without debate."
Doubtful it will pass Senate if passing House. Good for a pump though upon House approval.
So for this play to work, most started talking about this yesterday and earlier today. Then it became mainstream in the last few hours. This may be the good old peak, but I think we can scalp some things tomorrow or find a good entry and sell if the vote passes etc. We just need to breakdown the outcomes, what this bill means, and chance of approval for both House and Senate etc.I am more bullish on TLRY than SNDL but I am sure there a few other tickets to watch. TLRY has better business model and lower float. Still within the Mems though.
Hexo, acb, and cgc all up 20+%
IIPR is up 4%
On the Bearish side of things - I don’t expect the bill to pass. Just some personal prospectives. - This is intended for the long-term plays - Scalps and others - whole different story.
I think the political powers that be, would feel it is a bit too hot of a topic given the midterms coming in NOV. Assuming the democrats (who highly support the bill) approved it on their own - it lays the groundwork for the Republican side to say - “While Inflation, Gas, and Food prices are out of control - the democrats give you Weed.” Democrats are by no means dumb and realize this is a potential outcome and would rather go with the we tried! It’s them not us!
Below is a snippet from Federal Marijuana Legalization Bill Officially Scheduled For House Floor Vote Next Week - Marijuana Moment
"The last time the MORE Act went to the floor in December 2020, it passed in a 228-164 vote, with just five Republicans joining their Democratic colleagues in advancing the reform. One of those five GOP members, Rep. Don Young (R-AK), died last week. He was one of bipartisan co-chairs of the Congressional Cannabis Caucus.
The move to hold another vote on the cannabis legalization bill comes weeks after congressional Democrats held a closed-to-press session at a party retreat that included a panel that largely centered on the reform legislation."
The bill has made it’s way out of the House Judiciary Committee and will now go to the Rules Commitee to prepare the bill for consideration on the House floor. The consideration of the measure may be governed by a “rule”. A rule is itself a simple resolution, which must be passed by the House, that sets out the particulars of debate for the bill—how much time will be allowed for debate, whether amendments can be offered, and other matters. This is what is happening on Monday.
After that the bill can be considered by the House, it will likely pass (because Democrats) and then head to the Senate where it will likely fail again. This bill has passed the House before and was then rejected by the Senate. Another thing to consider is that Biden has indicated he does not favor Federal legalization of cannabis.
Edit: Edit to say I don’t think the bill will pass and become law but the run-up to the vote and the intial time after it passes the House before going to the Senate could provide some good plays.
Cannabis ETFs with options:
MSOS - ADVISORSHARES PURE US CANNABIS ETF
YOLO - ADVISORSHARES PURE CANNABIS ETF
CNBS - AMPLIFY SEYMOUR CANNABIS ETF
THCX - CANNABIS ETF
TOKE - CAMBRIA CANNABIS ETF
POTX - GLOBAL X CANNABIS ETF
MSOS is the only one with decent volume, would probably be easiest to get fills on that one.
MSOS Current Holdings
https://advisorshares.com/wp-content/uploads/csv/holdings/AdvisorShares_MSOS_Holdings_File.xlsx
YOLO’s biggest holding is MSOS
https://advisorshares.com/wp-content/uploads/csv/holdings/AdvisorShares_YOLO_Holdings_File.xlsx
CNBS is similar to MSOS
https://amplifyetfs.com/cnbs-holdings
THCX - not familiar with anything but TLRY
https://thcxetf.com/fund/thcx-holdings
TOKE - Largest holding is scott’s miracle-gro
https://www.cambriafunds.com/toke-holdings.html
POTX - This is the one that’s weighted very heavy to actual weed stocks, might be the biggest mover. Very little OI but that kinda reminds me of RSX (lol) before invasion.
https://www.globalxetfs.com/funds/potx/?download_full_holdings=true
Is there enough OI on TLRY or SNDL to get any kind of gamma squeeze?
There’s about 36k OI that’s ITM as of close for TLRY. If it holds $8 through open that increases to About 56k. Unless there are other factors reducing the float, it’s over 400M right now, so I don’t see a gamma squeeze happening on TLRY.
SNDL earnings on 29th as well. Never expected anything good from this company’s ERs but that’s something to keep in mind for those playing it
SNDL is a potential short squeeze candidate. Looking at the options, the 2023’s are super cheap, even when ITM
I spoke to a friend who use to be a senators aide and is now a lobbyist in DC this morning about the weed bill. He said it’ll likely pass the house and it’s unlikely to make it past the senate (he said unlikely to get 10 republicans to vote for the filibuster).
Just sharing for the good of the group
SNDL earnings are on Tuesday
Super cheap!? I can afford them LOL! What’s the move boss?
The Rules Committee is scheduled to meet on the following day:
Wednesday, March 30, 2022 at 1:00 p.m. to report a Rule for H.R. 3617.
https://www.majorityleader.gov/content/weekly-leader-friday-march-25-2022