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investments. So for example, you could remain long on companies X, Y, and Z, but also keep an open position in HMJI as a hedge. With a hedge, you can expect to reduce the volatility and help cancel out the noise in the day to day price movements. Even if all of the marijuana companies are sinking or rocketing, assuming your individual picks are a better performer than the overall sector as defined by the contents within the HMJI ETF then you will stand to make gains. This, of course, is not guaranteed to work, but with your expertise that you have acquired from our magazine and a professionals help this may be an approach worth considering when you are uncertain or feel the overall sector is not overly bullish but are still bullish on your specific companies you are invested in - at least more than the rest.
Extra Bullish outlook:
If you have a bullish outlook on the marijuana stocks then your new best friend could just be HMJU (the 2X leveraged fund)
Question: Where did the bull lose all his money?
Answer: At the “Cowsino”.
money from your investments. What happens when you are feeling overly optimistic or bullish about the marijuana sector and all of the fundamental and technical pieces are aligning together ever so perfectly. Well, we now have a new option for you, the leveraged HMJU fund. With this fund, you can expect approximately the value of the gains you see as the companies go up in value to double. Of course, the opposite will be true if you are wrong. Again, we know you are constantly improving your technical analysis, so the odds of you being correct are ever improving. Some of the benefits of being bullish via an ETF as opposed to actually taking out a loan to leverage your account on individual stocks include:
Reduced commission fees (unless only purchasing one individual stock)
No borrowing costs to leverage your position.
Less individual stock risk as the ETF contains a bucket of companies and an unexpected company-specific event will not be as drastically felt as if you were leveraged on only one specific position. For example, imagine a company you are leveraged on announces a crop failure or are being sued.
When you leverage a stock using borrowed funds and the trade goes against you, you not only risk losing all of your money but the money that is borrowed and not yours, to begin with. With the ETF you can be leveraged but only ever lost the maximum of what you put in.