CANNABIS MARKET UPDATE JANUARY 2026

CANNABIS MARKET UPDATE JANUARY 2026 – A New Year and New Hope ?

February 4, 2026

A New Year and New Hope ?

SWI Cannabis Portfolio Stock Values decreased by 8.1% in January
A significant Drop after an Increase of 22.2% in December

At SWI, we entered the new year with optimism, hoping that the promising momentum of a 22% increase in value in December 2025 would carry us forward and possibly accelerate even further in the new year. Regrettably, that vision did not materialize. The reality is that many cannabis companies, particularly major Canadian players like Canopy Growth, Innovative Industrial, and Tilray, have struggled to achieve profitability for years. Their revenues have stagnated or declined, while persistent issues like mounting losses and cash burn remain significant obstacles. Unfortunately, this troubling trend persists, underscoring ongoing industry challenges.

Regulatory Uncertainty continues sparking Volatility.

Investors have sold on news that didn’t meet expectations — for example, after a federal executive order on rescheduling didn’t include banking reform many had hoped for. Even positive policy moves (like a shift from Schedule I to Schedule III) sometimes spark volatility rather than sustained rallies — because the details and implementation remain unclear.

Analysts’ Expectations for 2026

Short-term (next 6–12 months)

Cannabis stocks may remain choppy. Even with good policy news, markets may “sell the news” if expectations are already priced in or if results fall short of investor hopes.

Medium-to-long-term (2026–2028)

If federal reforms (tax, banking, interstate) continue and companies improve profitability, valuations could recover significantly — especially for well-capitalized multi-state operators and ancillary service businesses.

SWI InvestmentTakeaway

Cannabis equities remain speculative, driven more by policy catalysts than by earnings today. If you’re considering exposure in 2026:

· Focus on companies with strong balance sheets and realistic paths to profit

· Don’t assume policy wins automatically translate to significant stock gains

· Consider diversified exposure (e.g., ETFs) rather than single names

Broader Market Exposure via SWI’s Favorite ETFs

AdvisorShares Pure U.S. Cannabis ETF (MSOS)

· Focuses on U.S. cannabis companies.

· One of the largest cannabis-focused ETFs.

Amplify Alternative Harvest ETF (MJ)

· Tracks global cannabis companies, including Canadian producers.

· Broad portfolio for diversified exposure.

Global X Marijuana Life Sciences Index ETF (HMLSF)

· Smaller ETF with life-sciences focus tied to cannabis.

Other ETFs worth noting

· YOLO – active strategy cannabis ETF.

CNBS / TOKE – smaller funds with different weighting and strategies.

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