An Introduction
Well meaning investors have seen their investments in either the Canadian Cannabis LPs or American Cannabis MSOs Portfolios decline month after month since this past May and, collectively, they are DOWN 60% meaning that most investors have seen their investment in cannabis stocks decline. Listen to the MunAiMarkets theme song and join the rich man’s world!
Take Advantage Of Tax-loss Selling Provisions
The above being said, they are now in a position to take advantage of tax-loss selling provisions by selling their losers so they can offset their gains from other investments. Follow MunAiMarkets on Facebook and never miss an article.
Alan Brochstein writes in an article entitled “Cannabis Investors Should Take Advantage of This Annual Opportunity” that:
“As the year’s end approaches, it’s a great time for investors to take action to reduce their near-term tax liability [and] for cannabis investors, this is especially important [again] this year given the…[month after month of] declining prices.
Those who booked gains on the way up but haven’t booked losses could be looking at large tax bills in early 202[5]…[and those U.S. investors] who are focused solely on the cannabis sector may not have any gains but just losses…[That being said, they] can deduct up to $3,000 each year in capital losses and can carry over excess losses into the future, so selling some cannabis stocks at a loss can reduce one’s income tax to some degree, even if there aren’t gains to offset…[Remember]…one doesn’t have to exit the market…[only] stay out of the stock sold for 30 days…[before buying] it back…”
What Can We Expect By Year End?
A further sell-off over the next 2 weeks is a distinct possibility based on what has happened at this time in the past 2 years. The 7 largest MSO stocks, as represented by the MunAiMarkets American Cannabis MSO Stocks Portfolio and the Canadian Cannabis LP Stocks Portfolio, experienced an average 54% range from high to low in December of 2022 and a 27% range in December of 2023. The Portfolios are already DOWN 50% this December, on average, so it looks quite likely we expect the same sell-off again this year.
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