By Nigam Arora
• The chart shows that momo crowd money flows are extremely positive in Curaleaf /zigman2/quotes/205334348/delayed CURLF +2.30% .
• The chart shows that momo crowd money flows are positive in MedMen /zigman2/quotes/201940908/delayed MMNFF +17.54% , Liberty Health /zigman2/quotes/204270480/delayed LHSIF -2.74% , Aphria /zigman2/quotes/207425803/composite APHA +1.05% and Aurora Cannabis /zigman2/quotes/210559470/composite ACB +3.00% .
• The chart shows that in Tilray /zigman2/quotes/209129655/composite TLRY +3.39% , smart money flows are negative but momo crowd money flows are extremely positive.
• The chart shows that in marijuana ETF /zigman2/quotes/204332491/composite MJ +1.99% , smart money flows are negative, but momo crowd money flows are positive.
• Corbus Pharmaceuticals /zigman2/quotes/201549545/composite CRBP +2.09% is a small biotech company but is also grouped with marijuana stocks. Smart money flows are positive. This stock has come under a vicious short attack.
• In other marijuana-related stocks, smart money flows are negative in GW Pharmaceuticals /zigman2/quotes/209686240/composite GWPH -0.56% , KushCo Holdings /zigman2/quotes/209165034/delayed KSHB 0.00% , Scotts Miracle-Gro /zigman2/quotes/200553749/composite SMG +2.65% and Constellation Brands /zigman2/quotes/207737284/composite STZ -4.14% .
• Smart money flows are neutral in Craft Brew Alliance /zigman2/quotes/209915231/composite BREW +0.94% .
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The chart shows the relative rankings of the five select popular marijuana stocks. Those rankings are based on the six screens of the ZYX Change Method. Please click here to learn about the six screens.
Risk-adjusted rankings are more useful for medium- and long-term positions. Non-risk-adjusted rankings are more useful for short-term or trade-around positions.
What to do now
There are millions to be made in marijuana stocks. However, these stocks are volatile. Volatility will cause many to lose their shirts. Segmented money flows are the best tool to keep your marijuana investments prudent.
There is merit to holding core marijuana positions. Astute investors would want to make sure that their position sizes are correct. Arora’s 14th Law is directly applicable in this situation: To be successful at investing and trading, become a master of position sizing. Position sizing is critical to investing in marijuana stocks. In addition, using techniques such as trade-around positions is especially important.
Those not in marijuana stocks may consider waiting patiently for signals to buy select marijuana stocks. There is too much risk in buying these stocks at these levels. Of course, there are exceptions in buying special situations in marijuana stocks as they develop, and also for short-term trades.
Disclosure: Subscribers to The Arora Report may have positions in the securities mentioned in this article or may take positions at any time. Nigam Arora is an investor, engineer and nuclear physicist by background who has founded two Inc. 500 fastest-growing companies. He is the founder of The Arora Report, which publishes four newsletters. Nigam can be reached at Nigam@TheAroraReport.com.