Following an ugly fourth quarter, marijuana stocks are on fire once again. In January, the Horizons Marijuana Life Sciences ETF, the first-ever cannabis ETF to trade in Canada, gained close to 50%, with 15 out of roughly four dozen pot stocks rising by at least 50%.

Why such optimism, you ask? Look no further than the legalization of recreational weed in Canada last October, which ended nine decades of adult-use prohibition, and the ongoing legalization of pot at the state level in the United States. Going green in Canada is expected to balloon sales in the country from a few hundred million dollars to perhaps as much as $6 billion by 2022.

Cannabis managed to bring in $17.4 million in sales for the Nova Scotia Liquor Corporation in the first few months of legalization, but that wasn't enough to make the bud profitable for the provincial Crown corporation. 

"We're not making money on cannabis at this point because of the implementation costs," NSLC spokesperson Beverly Ware said Tuesday. 

Those costs include renovating stores, purchasing products, along with the hiring and training of new employees. 

Khurram Malik believes there is a “dramatic” lack of legal CBD products in Canada.

The CEO of Biome Grow, a cannabis holding company with licensed pot operations in a number of Atlantic provinces, says his ongoing conversations with various provincial liquor control boards, specifically in Nova Scotia and Newfoundland and Labrador always ends up circling back to one topic — the complete dearth of cannabis products high in CBD content, versus the large demand for it.

“When recreational legalization was going to happen, I think many of the licensed producers focused too much on the THC side of the sector. Now we’re seeing there’s actually a huge demand for CBD,” Malik said.

Interest around cannabis stocks continues to rise as legal adult use sales pick up steam in Canada and California, and other U.S. states move to legalize either recreational or medical use of the plant.

Investors have directed much of their attention on production and distribution of dried flower used for smoking.

Over the past couple of years, the hype behind cannabis stocks has been building to an all-time high, with many company stock prices doubling and tripling in the first nine months of 2018. Although the last quarter of the year shook the foundations of many of the less serious cannabis investors, 2019 has already seen an excellent return to force. Just in January, global cannabis stocks increased 31 percent, a trend that’s poised to continue throughout the rest of the year.

Canopy Growth has big plans for its edibles and vape pen rollout

One measure of a stock’s volatility is called beta, which is defined as the covariance of the stock and the market (typically an index such as TSX Composite) divided by the variance of the market.

The Canadian cannabis stocks we’ve dug up today have had an average one-year beta 3.1, indicating they are likely to have strong price movements in the future. For reference, the closer a stock’s beta is to 1, the closer it follows market movements.

America’s licensed marijuana sellers are just getting started.

They have only a few stores and profits are scarce. Their Canadian-listed stocks—they can’t trade on U.S. exchanges as marijuana remains illegal under federal law—also trade at steep multiples of the nascent industry’s sales. Maybe that’s because they are mainly owned by giddy retail investors—or maybe that’s the risk of getting in on the ground floor of ventures that aim to become the Starbucks of marijuana.

Canada's nationwide recreational marijuana market opened last October; last week, we got results from Canada's two biggest marijuana companies that suggest the country's marijuana market represents a massive opportunity.

Cannabis is rapidly becoming a global financial concern as nations ranging from the U.S. to Canada to Colombia to Israel — to name just a few — are actively discussing how to best partner up and get in on this economic juggernaut. Those imminent marijuana enterprises worldwide will soon create the industry’s global supply chains, lower costs, and potentially lead to scientific research for the plant as medicine.