When I initially came across Auxly Cannabis (OTCMKTS:CBWTF) in my research, it immediately caught my attention as it bridges together two of my favorite investment themes — streaming royalty payments and marijuana.

As the first of its kind, the company provides funding to the marijuana industry, which can be very difficult to get for early-stage companies. In return for the funding, Auxly is entitled to royalty payments and/or a piece of the company.

An industry in its infancy, the cannabis sector has been drawing several big-name investors given the industry’s rapid-growth outlook. Back in November 2017, Canopy Growth Corp. (TSX:WEED) drew headlines as Constellation Brands (NYSE:STZ), one of the world’s largest alcohol companies, announced a $245M investment in Canopy. Since then, the industry has seen further consolidation and continues to draw interest from large alcohol and tobacco companies.

Volatility continues to run wild in the marijuana stock industry and investors are trying to figure out which pot stocks are the safest bets heading into 2019.

Let’s take a look at Canopy Growth Corp.(TSX:WEED)(NYSE:CGC) to see if it deserves to be in your portfolio right now.

Volatile market

A year ago Canopy Growth traded for $18 per share. In the middle of October, it hit a closing high above $73 and has since given back a good chunk of the gains. At the time of writing, investors can buy the stock for $43 per share.

Canadian marijuana company Cronos Group has seen its stock rally by close to 25% over the last two days, amid reports that Tobacco major Altria is in early-stage talks to invest in the company. While Cronos confirmed the talks, it noted that there was no assurance that it would reach an agreement or that a deal would go through. In this note, we take a look at what these developments could mean for Cronos.

The year 2018 is almost at an end, and with that comes the question of what will happen this year’s breakout sector: marijuana.

Marijuana stocks dominated the financial headlines this year to such an extent that it’s hard to even think of a contender for second place. That’s not to say that cannabis stocks have had a uniformly great run. Some, such as Aphria Inc, are actually down year-to-date. But the sector gave us the biggest rally of the year–short lived though it was–and received by far the most media coverage of any group of TSX stocks.

After cannabis shone so brilliantly this year, it’s natural to have high hopes for the next. But are such hopes justified? It helps to start by looking at how cannabis stocks are doing now.

The maker of Marlboro cigarettes is joining some of the biggest names in beer in exploring the budding cannabis marketplace.

Altria Group Inc., which owns Philip Morris USA, is the latest big company to show interest in marijuana. Late Monday, Canadian medical marijuana company Cronos Group Inc. confirmed talks with Altria about a possible investment.

Altria, based in Richmond, Virginia, is one of the largest cigarette makers in the United States. The company said it had no comment on Cronos’ announcement.

The marijuana industry has had a year like no other before it. In October, Canada became the first industrialized country in the world to legalize recreational cannabis. Then, during midterm elections in November, two more states joined the previous 30 in approving medical marijuana. Not to mention, voters in Michigan approved a recreational pot proposal making the Great Lakes State the 10th overall to have legalized weed use for adults.

The current cannabis shortage could be stabilized by the spring of 2019, but it could eventually be replaced by a flood of product on the market that will then lead to lower prices and consolidation, say lawyers representing clients in the sector.

This has been a truly game-changing year for the cannabis industry.

The big event, as you're probably aware by now, was the legalization of recreational marijuana in Canada on Oct. 17. Following years of promises to do so from Prime Minister Justin Trudeau, and months of debate in the Senate, the passage of the Cannabis Act in June paved the way for the lifting of nine decades of recreational cannabis prohibition in our neighbor to the north. When the industry is running on all cylinders by the early part of the next decade, it should be generating around $5 billion in added annual sales.

Shares in Canadian cannabis company Aphria Inc. plunged for the second day in a row on Tuesday as the company fought back against allegations from a short seller that its recent slew of overseas takeovers are worthless and designed only to enrich company insiders.