How to invest in cannabis stocks

Cannabis stocks have had a meteoric rise following new legislation, although the buzz around the stocks has been cooling of late.

However, the sector still has the potential to exponentially rise even if it faces a number of headwinds.

How to invest in cannabis

There's more than one way to invest in cannabis.

• Australian cannabis stocks. This means buying stocks on the Australian share market in cannabis companies or companies that have cannabis exposure.
• International cannabis stocks. Some of the biggest cannabis companies are listed on stock exchanges in overseas markets such as the US or Canada. It's possible to invest in these if you use a broker that offers global stocks. Click on the "global" list above to see some of these stocks.
• Cannabis ETFs. ETFs contain a bundle of stocks, usually hundreds, and these often track an index of stocks. There are around 6 cannabis ETFs listed in the US; to date, there are no ASX-listed cannabis ETFs.
• CFD trading. You can trade cannabis stocks, ETFs or indices using CFDs. CFDs are contracts that allow you to make money on the price movements of an underlying asset, such as a share or commodity. Warning – these are complex products best suited to experienced traders.
• Copy portfolio. Share trading app eToro has a pretty neat portfolio of cannabis stocks that you can invest in. These are called copy portfolios and there are a bunch of investment themes you can track. To check them out, click on eToro's link in the table below.

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How do I buy cannabis stocks?

1. 1. Choose a share trading platform. If you're a beginner, our table below can help you choose.
   2. Open your account. You'll need your ID, bank details and tax file number.
   3. Confirm your payment details. You'll need to fund your account with a bank transfer, debit card or credit card.
   4. Find the shares you want to buy. Search the platform using the stock ticket code and buy your shares.

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Finder Score	AU Trading Fee	US Trading Fee	Asset Class
Promoted 9.6 Excellent Moomoo Share Trading Finder Award	9.6 Excellent	$3.00	US$0.99	ASX shares, Global shares, Options trading, US shares, ETFs	Welcome offer: Enjoy 30 days of $0 brokerage on AU and US stocks and receive up to 30 free shares when you open and fund a new account. Expires on 30 Sep 2026. T&Cs apply.	Trade major markets with built-in social trading tools.	$100 RewardT&Cs apply T&Cs apply Go to siteView details Compare product selection Compare	loading
Promoted 8.7 Great eToro Most Loved	8.7 Great	US$2.00	US$2.00	ASX shares, Global shares, US shares, ETFs, Cryptocurrencies	CFD service. Capital at risk. Trade a range of assets from a single account with access to social trading features.	$150 RewardT&Cs apply T&Cs apply Go to siteView details Compare product selection Compare	loading
Promoted 9.8 Excellent Webull Finder Award	9.8 Excellent	$1.00	$0.00	ASX shares, Global shares, Options trading, US shares, ETFs, Cryptocurrencies	Invest in over 15,000 shares, options, and $0 Brokerage on all U.S. and Australian Chess-Sponsored ETFs.	$150 RewardT&Cs apply T&Cs apply Go to siteView details Compare product selection Compare	loading
9.3 Excellent Tiger Brokers Finder Award	9.3 Excellent	$3.00	US$2.00	ASX shares, Global shares, Options trading, US shares, ETFs	Deposit any amount and receive $20 to trade in Tiger Brokers. Plus 4x zero brokerage trades and no FX fees on the first $2,000 you exchange every month. T&Cs apply.	Trade US, Asian and CHESS-sponsored ASX stocks, China A-class shares, plus US and Hong Kong options and ETFs.	$120 RewardT&Cs apply T&Cs apply Go to siteView details Compare product selection Compare	loading
9.3 Excellent IG Share Trading Finder Award	9.3 Excellent	$0.00	US$0.00	ASX shares, Global shares, US shares, UK shares, ETFs	Go to siteView details Compare product selection Compare	loading
9.9 Excellent CMC Invest Finder Award	9.9 Excellent	$0.00	$0.00	ASX shares, Global shares, Options trading, US shares, mFunds, ETFs, Cryptocurrencies	Trade 40,000+ listed securities across the local markets and 15 major global exchanges.	Go to siteView details Compare product selection Compare	loading

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Cannabis products

While smoking weed is perhaps the best-known use of cannabis, there are many types of businesses that are set to benefit from the growing sector. In Australia and other countries, legalisation of many of these products is still new and, in some cases, still underway. These include the following:

• Medicinal products. Medicinal cannabis is used in Australia for the treatment of cancer pain, epilepsy, palliative care, chemotherapy nausea, neuropathic pain, anorexia and neurological conditions.
• Science and research. Recent policy changes mean that cannabis may be cultivated for both scientific and medicinal reasons in Australia.
• Recreational use. Marijuana as a recreational drug is still illegal or restricted in most countries and in some cases carries serious punishment. However, legalisation is starting to occur in parts of the US and in all of Canada. It's consumed to achieve feelings of relaxation or euphoria – however, there are also a number of possible side effects.
• Food products. Hemp is used as an ingredient in a range of products, including cooking oils, snacks, protein powder, cooking flour and more. The sale of hemp food products in Australia was legalised in 2017.
• Building materials. Hemp is used in insulation and building construction materials and has several names, including hempcrete, hemp masonry and hemplime.
• Clothing. Hemp is broadly recognised as one of the most sustainable materials available in the manufacturing of clothing.
• Beauty products. Hemp is commonly used in various health and beauty products, such as moisturisers, lip balm, makeup and skin oils.

Risks

Despite the large opportunity, the sector has plenty of risks investors need to be wary of before investing.

• Speculative bet. The sector is still emerging. It's a new industry with marijuana only being used beyond medical purposes since 2012. As such, most of the companies are small caps, which means they are likely to have large share price swings as well as being traded less often. As such, they are more speculative than large caps.
• Limited investors, especially from large institutions. While the sector is growing, it certainly doesn't have the mainstream adoption of much of the market.
• Valuation risks. Given the size of many of the stocks and potential growth being unknown, it's harder to valuate a fair price for these stocks.
• Dilution risks. Cannabis stocks are still controversial and have challenges that are unique to the sector. As such, investors may face the risk that the companies they own have fewer ways to raise money other than through issuing more shares. This could mean the value of your ownership falls.
• Commodity risks. Just like all other commodities, cannabis is a crop. Some years, its value will be higher; other years, it will fall. This risk can be avoided by not investing in the producers themselves.

Frequently asked questions

• Are cannabis stocks legal to buy in Australia?

  Yes. You can legally buy and sell shares of cannabis-related companies listed on the ASX or other international exchanges. However, the companies themselves must operate within Australian laws, which restrict the cultivation, manufacture and sale of cannabis to medical and research purposes. Recreational cannabis remains illegal at the federal level.

• Can I buy overseas cannabis stocks from Australia?

  Yes. Many Australian brokers provide access to international markets like the NASDAQ, NYSE or Canadian exchanges. You’ll need an international trading account and should be aware of foreign exchange fees, taxes and the regulatory environment in those markets before investing.

• What risks are involved in investing in cannabis stocks?

  Cannabis is a high‑volatility sector. Share prices often move sharply due to regulatory changes, investor sentiment or inconsistent company earnings. There’s also the risk of slower legalisation, oversupply or changing consumer trends. As with any speculative investment, it’s best to do your own research and diversify your portfolio.

• How are cannabis companies regulated in Australia?

  Only companies licensed by the Office of Drug Control (ODC) can cultivate, produce or research medicinal cannabis under strict government guidelines. These regulations limit how and when products can be sold, which directly impacts company revenue and share performance.

• Do cannabis stocks pay dividends?

  Generally, most cannabis companies are still in the growth or research phase and reinvest profits back into the business. As a result, dividends in this sector are rare. Investors mainly look for capital growth rather than income.

• What’s the outlook for the cannabis industry in Australia?

  Industry analysts expect continued expansion driven by growing acceptance of medicinal cannabis and potential reforms in regulation. However, the pace of growth depends heavily on legislative developments, market competition and the rollout of new medical applications.

• How can I research cannabis stocks before investing?

  You can start by reviewing company announcements on the ASX website, reading independent analyst reports and checking each company’s financial statements. Also look into production capacity, distribution agreements and any recent regulatory approvals.

• Are there ETFs that invest in cannabis stocks?

  Yes. A number of exchange‑traded funds (ETFs) provide exposure to global cannabis companies. Some Australian brokers give access to these ETFs listed in the US or Canada. Always check the fund’s holdings, currency exposure and management fees before investing.

• What tax implications apply to cannabis stocks?

  Cannabis shares are treated like any other investment in Australia. You may need to pay capital gains tax (CGT) when you sell for a profit and dividends (if any) could be taxable income. If you invest internationally, you might also face foreign withholding taxes. It’s worth speaking to a tax adviser about your personal situation.

• How do I know if a cannabis stock is legitimate?

  Check whether the company is licensed by the ODC or holds appropriate international certifications if it operates overseas. Review its financial filings, management team background and business model. Be cautious of speculative micro‑cap stocks that lack detailed public information.

• What percentage of N/A is owned by insiders or institutions?

  Currently N/A% of N/A shares are held by insiders and N/A% by institutions.

Written by

Kylie Purcell

Investments Analyst

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Kylie Purcell is an experienced investments analyst and finance journalist with over a decade of expertise in a wide range of financial products, including online trading platforms, robo-advisors, stocks, ETFs and cryptocurrencies. She is a sought-after commentator and regularly shares her insights on the AFR, Yahoo Finance, The Motley Fool, SBS and News.com.au. Kylie hosts the Investment Finder video series and actively contributes to the investment community as a judge and panellist. She holds a Master of Arts in International Journalism, a Graduate Diploma in Economics, and ASIC-recognised certifications in securities and managed investments. See full bio

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