Investing In CBD Stocks Offers Opportunity But Risks

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There is a lot of hype regarding CBD and a lack of regulatory clarity. I discuss the big issues and identify some of the better players in the space among public-traded companies.

Cannabidiol has taken off lately, and the recent passage of the Farm Act in December has accelerated interest in the cannabinoid found in cannabis plants that was also the active ingredient in the first FDA approved drug derived from botanical cannabis, GW Pharmaceuticals's Epidiolex, which is indicated for the treatment of seizures in treatment-resistant forms of two types of epilepsy, Dravet syndrome and Lennox-Gastaut syndrome.

The recent Farm Act that legalized industrial hemp was supposed to clear the path for the sale of CBD from industrial hemp, but this is only at the federal level. It turns out that states must create legislation to govern hemp production and the commercialization of hemp.

Gottlieb had recently announced that the agency would hold public hearings on the issue in April. His pending departure throws into question how this will all play out, so uncertainty will persist for a while.With the tremendous growth in the market, investors have expressed keen interest in CBD, and the number of publicly-traded stocks has skyrocketed.

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