There's never been a more dangerous time to invest in cannabis than right now. Pot stocks are plummeting and companies are running low on cash, making consolidation and bankruptcies inevitable in the near future.
A big reason for the struggle comes back time and time again to the legal industry's high pot prices. Whether it's taxes, overhead costs, or just pricey red tape, cannabis companies are struggling to remain competitive against the black market. Unfortunately, winning market share from the black market is a long-term goal for the legal industry, and right now, there are serious short-term problems investors can't ignore. And while North America may be particularly risky today, other parts of the world may offer safer pot plays.
A big disadvantage for North America is that its cold winters limit the opportunities for growing cannabis, especially outdoors. But in places like Uruguay or Israel where the temperature is pretty warm year-round, those same problems don't exist. Uruguay, in particular, is an attractive option as it was the first country that legalized the recreational use of marijuana.