Canadian CANNAINVESTOR Magazine April 2017 - Page 50

Putting this all together, the typical Retail Investor that is long on this industry in Canada has good reason to be and for that reason may have adopted a traditional buy and hold strategy. Accepting the industry as an ecosystem where the Retail Investor plays a vital role and understanding that Ecoforming is continuously transforming this Ecosystem allows the typical Retail Investor to alter their mindset and approach to investing. When imagining a terrain undergoing a rapid shock to the system such as, for example, from a natural disaster – the strategy that comes to mind for optimal survival is one of: preparedness, planning, contingencies, and be able to adapt fast to a quickly changing and threatening surrounding. Clear and reliable access to timely relevant information is as critical as is avoiding all sources of misleading and false information. Whereas gradual Ecoforming is akin a farmland bought out, rezoned, and transformed into a subdivision complete with gas stations and a plaza. Now change gears from surviving in a hostile physical environment to investing in a precarious industry relying on yet to be introduced legislation that will pave the way for the eventual legalisation of recreational marijuana in some form. That mindset (ever changing environment) when applied to investing in this industry increases the potential for success. The Retail Investor who can take that approach can remain long on a sector and even on specific companies but knows when to take short term actions to maximize return, safeguard capital, and reduce risk by, for example, adapting a Technical Analysis strategy to time entry and exit points and re-entry points where warranted. A relevant recent example would be several investors that I know who are long on Canopy Growth selling their entire positions on December 1st to buy shares of Mettrum due to the arbitrage that existed resulting in an increase in their shares held of Canopy Growth when the acquisition was completed.

Retail Investor's Perspective