Three new billionaires emerge from pot stock rally

Thursday, 20 September 2018
Melbourne, Australia
By Bernd Struben

  • Bitcoin, ether and weed…oh my!
  • Mailbag
  • Labor burning taxpayer money to smear Dutton

There was a time when the only billionaires dealing in marijuana carried automatic weapons and were known to undergo plastic surgery to alter their appearance.

Times, they are a changin’.

We’ll get back to the new legitimate pot stock billionaires shortly. But first…

Yesterday we looked at some of the signs pointing towards a potential new price surge for cryptocurrencies.

Among them is the continued expansion of new hedge funds into the sector. Not to mention a marked increase in interest and investment coming from some of the biggest names in finance. Like billionaire entrepreneur Richard Branson.

Yet even with the potential return to some of the stellar gains cryptos enjoyed in 2017 — remember ether soared 14,263% in just over 12 months — not everyone is comfortable investing in them.

One of the biggest concerns people have with cryptocurrencies is the possibility of hacking.

That’s certainly a valid concern.

Although, as Sam Volkering explains in the new print version of his crypto investing bible, Crypto Revolution, there are a number of ways to try and keep your crypto holdings out of the hands of hackers. (Details here.)

But when it comes to hackers, it’s not just cryptocurrencies you should be worried about. In today’s ever more digitalised world, the dollars in your bank account could also be whisked away by savvy fraudsters with the click of a mouse.

The latest scam involves phony banking apps. It targeted ANZ and CBA customers, among others.

As The Sydney Morning Herald reports:

More than a thousand bank customers have unwittingly downloaded malicious banking apps impersonating legitimate ANZ and Commonwealth Bank apps from the Google Play store.

The fake apps appear to have gone undetected for weeks, phishing for credit card details and/or banking log-in credentials from unsuspecting bank customers…

How many Australians actually parted with their personal log-in credentials or credit card information is unknown…

Banks in Britain, Switzerland and Poland were also caught up in the scam. Major European cryptocurrency exchange Bitpanda was also impersonated.’

The article offers some tips on how to avoid falling victim to phishing and other fake financial apps. None of those tips cover the one I’m about to give you.

Ready?

Don’t download any of those apps. While they may save you 30 seconds of time here and there, the heightened risk of being ripped off simply isn’t worth it. Perhaps it should take a whole minute to transfer money to someone else’s account. Better that than discover your funds were just blown by some crook on a spending spree in Bucharest.

But despite the risks, the big financial institutions keep pushing ahead with technologies entwining smartphones (and now watches) with your finances.

From The Australian:

Westpac will let customers make payments with Apple’s Siri voice technology. ANZ meanwhile is allowing its customers to ditch their plastic cards and transact with ATMs using their phone or smartwatch.

Payments with voice recognition technology? Even supported by fingerprint or facial recognition backups, surely hackers are salivating at the new opportunities this presents. And since when have debit cards been cumbersome?

Getting back to cryptocurrencies, they’re really no more susceptible to hackers than fiat money these days. But as with the money in your bank account, it’s important you know how to securely send it to the people you’re intending to pay. And how you can store it safely out of reach of malicious hackers.

These are just a few of the vital issues Sam explains in his newly released print version of Crypto Revolution. Get all the details here.

Now to the markets.

Markets

Overnight the Dow Jones Industrial Average closed up 158.80 points, or 0.61%.

The S&P 500 gained 3.65 points, or 0.13%.

In Europe, the Euro Stoxx 50 index finished up 10.10 points, or 0.30%. Meanwhile, the FTSE 100 gained 0.42%, and Germany’s DAX closed up 61.35 points, or 0.50%.

In Asian markets, Japan’s Nikkei 225 is up 45.10 points, or 0.19%. China’s CSI 300 is down 0.07%.

In Australia, the S&P/ASX 200 is down 21.06 points, or 0.34%.

On the commodities markets, West Texas Intermediate crude oil is US$71.44 per barrel. Brent crude is US$79.34 per barrel.

Turning to gold, the yellow metal is trading for US$1,204.48 (AU$1,658.61) per troy ounce. Silver is US$14.28 (AU$19.66) per troy ounce.

One bitcoin is worth US$6,412.15.

The Aussie dollar is worth 72.62 US cents.

Bitcoin, ether and weed…oh my!

Since we’re on the topic of crypto’s meteoric performance in 2017, pundits are drawing analogies to what’s happening with the skyrocketing share prices of pot stocks in 2018.

As you’re likely aware, the past few years have seen cannabis transition from ‘the devil weed’ to a plant with remarkable medicinal potential. Moving well beyond medicinal use, a growing number of nations are legalising cannabis for recreational use as well.

This week South Africa became the latest nation to follow suit. Overruling the government’s opposition, South Africa’s highest court legalised the use of marijuana by adults in private locations. While citizens will be allowed to grow the plant, selling it remains a crime…for now.

Canada — like a number of US states — is about to go a big step further.

On 17 October, less than four weeks from now, Bill C-45 will be written into law. And recreational marijuana use, cultivation and sale will be legalised across the country.

It’s this massive new multi-billion-dollar market that’s drawing investor attention around the globe. And it’s seeing the share price of select pot stocks go through the roof.

From Bloomberg:

Shares of Tilray Inc. have rallied more than 1,000 percent since the Canadian pot firm went public in July, leaving some of the most hyped digital-currency companies in the dust. By comparison, Riot Blockchain Inc. only surged around 400 percent after the former machinery maker for the biotech industry ditched its old name, Bioptix Inc., in October.

Tilray shares skyrocketed 50 percent on Wednesday alone after Chief Executive Officer Brendan Kennedy claimed the company may one day be among a few other players in the industry with a valuation north of $100 billion… Tilray isn’t alone. Alkaline Water Co. and New Age Beverages Corp. also rallied recently after eyeing cannabis-related drinks.’

You can see the outperformance of this newly minted Canadian pot stock (purple line) over Riot Block Chain (blue line) below:



chart image

Source: Bloomberg
Click to enlarge

The monumental price surge is credited with creating three new billionaires: Brendan Kennedy, Michael Blue and Christian Groh. The three men are the founders of Privateer Holdings Inc, a major shareholder in Tilray. And Tilray now has a market cap of $21 billion.

As Bloomberg notes, ‘Privateer’s stake in Tilray is now valued at $7.2 billion, giving each founder a net worth of at least $2.4 billion, assuming they hold equal stakes.

The new billionaires were likely on the edge of their seats yesterday. It proved to be a volatile day for Tilray. Volatile enough to see trading halted five times. The share price went up more than 90%, then fell back to where it started, before finishing the day 38% higher.

Michael Antonelli is an institutional equity sales trader and managing director at Robert W. Baird & Co. Addressing the volatility, Bloomberg quotes him as saying:

It’s almost like everyone wanted to express their fear and greed through one entity… It’s fun to watch. It’s the wild west right now for cannabis. It isn’t the kind of thing that institutions would touch.’

The institutions might not be able to touch this explosive new market. But that doesn’t mean you can’t.

As with his remarkable foresight with cryptos, Sam Volkering was scouting out opportunities in the pot stock market before many investors had even heard about it.

Sam recommended his first Aussie-listed pot stock play back in February 2017. That stock was up 307.7% from Sam’s buy-in price, as of Monday this week.

Now not all of his pot stock recommendations have enjoyed similar gains. A few have even lost ground.

But Sam is convinced his latest Australian pot stock company could beat those gains, forecasting a potential share price rise of 495%. And it’s largely thanks to Canada’s sweeping legalisation.

However, as I cautioned yesterday, Sam tells me that for your best chance of realising those kinds of gains, you’ve got to get into the stock before 17 October.

You can get all the finer details here.

Mailbag

Have you made or lost money in the crypto markets? How about pot stocks? And do you reckon it’s high time that Australia emulate our progressive cousins across the sea and create a new, legal market for cannabis Down Under? Or is Peter Dutton right in labelling it a ‘gateway drug’ with links to schizophrenia?

Send your comments or queries to letters@portphillipinsider.com.au. If we decide to publish your email, we’ll only print your first name.

Now before you sign off, here’s the latest from The Australian Tribune:

‘Labor Burning Taxpayer Money to Smear Dutton’

Judging by the shrill cries of outrage from Labor and the Greens, you might think that the two au pairs Home Affairs minister Peter Dutton cleared to enter Australia were foreign spies. Or terrorists. While in fact they were just young women coming into the country to care for children.

As Labor continues to stir this storm in a teacup at taxpayer expense, Prime Minister Scott Morrison has…’

If you’re fed up with sanitised, politically correct dogma cut and pasted from one mainstream source to another, then The Australian Tribune is for you.

And it’s absolutely free.

Sign up here to get The Australian Tribune delivered free to your inbox five days per week.

You can visit our website at https://www.theaustraliantribune.com.au/ to read the complete article above now.

Cheers,
Bernd