Cannabis

Screening Filters

1. Theme: The Cannabis Industry

   • Purpose: Limit the universe to companies that are directly involved in, or closely tied to, the cannabis industry.
   • Rationale: Your question is specifically about the cannabis industry or cannabis-related stocks. This thematic filter ensures the results are actually cannabis operators (cultivators, distributors, MSOs), ancillary providers (packaging, technology, hydroponics), or companies whose core business is materially linked to cannabis. It excludes unrelated sectors so the analysis reflects the real state of the cannabis space.

2. Market Cap: min 200,000,000 (≥ $200M)

   • Purpose: Focus on larger, more established cannabis-related companies.
   • Rationale: The cannabis space is full of micro-caps and highly speculative names. By setting a $200M minimum market cap, the screen prioritizes companies that:
     • Are typically more mature, with more stable operations.
     • Have better disclosure and analyst coverage, which makes “industry status/analysis” more meaningful and less driven by extreme outliers.
     • Are more representative of the overall industry trends, rather than tiny, idiosyncratic players.

3. Price: min 1 (≥ $1 per share)

   • Purpose: Exclude ultra-low-priced “penny stocks.”
   • Rationale: Many cannabis-related stocks trade at very low prices on minor exchanges or OTC markets and can be extremely volatile and thinly regulated. A $1 minimum price:
     • Filters out the most speculative tickers where price moves can be disconnected from fundamentals.
     • Keeps the list focused on names where price signals and valuation ratios are more meaningful for analysis.

4. Monthly Average Dollar Volume: min 200,000 (≥ $200K traded per month)

   • Purpose: Ensure the stocks are reasonably liquid and actively traded.
   • Rationale: To analyze the “current status” of a sector, you want stocks that:
     • Trade enough value for prices to reflect real investor sentiment.
     • Are less prone to sharp, easily manipulated moves due to low liquidity.
     • Are investable in practice for most market participants.
       A $200K monthly dollar volume floor is modest but helps remove extremely illiquid, hard-to-trade names from the sample.

5. Is Optionable: True

   • Purpose: Select cannabis-related stocks that have listed options.
   • Rationale: Optionable stocks tend to be:
     • Larger, more followed names within their sector.
     • More important “benchmark” or “bellwether” tickers that institutions and active traders use for exposure and hedging.
       Since you’re asking about the industry status, focusing on optionable names highlights the more established, widely watched companies that often drive sector sentiment.

Why Results Match Your Question

• The cannabis theme filter directly targets the industry you asked about, ensuring the list consists of cannabis or cannabis-linked companies.
• The market cap, price, and liquidity filters refine that universe to more established, liquid, and analyzable stocks—better suited to understanding the true state of the cannabis industry rather than speculative noise.
• The optionable filter further focuses on the most followed, more mature cannabis names, which often serve as key indicators for how the broader cannabis sector is perceived and valued in the market.