Poll: Wealthy investors not interested in marijuana
The majority of San Francisco’s wealthy investors won’t be doing business with cannabis any time soon.
Only 15 percent of high net worth investors in the Bay Area say they would be likely to invest in the legalized marijuana industry in the next 12 months, according to Morgan Stanley’s Wealth Management Investor Pulse Poll.
After surveying 1003 investors age 25 to 75 online, Morgan Stanley concluded the following:
Interest in investing in legalized marijuana is relatively low among San Francisco-area HNW investors. In the short term, two in three (65%) are not at all likely to invest where it is legalized in the next 12 months; another one in five (20%) are not too likely. Imagining for a moment that marijuana were legalized in California, and throughout the US, most say they would not invest (69% and 67%, respectively, disagree).
The Bay Area’s lack of financial interest in marijuana is surprising when compared to state and national polls. Although the area is considered liberal and cannabis-friendly, the 85 percent of investors unlikely to invest in cannabis businesses are a huge increase over California’s overall 69 percent disinterest in pot investments, as well as the nation’s at 97 percent.
“However, this leaves sizable shares that are open to the idea, if legalized,” the Morgan Stanley poll notes.
Those most open to investing in cannabis in California are HNW investors aged 65 and over, who represent 38 percent of the poll. Outside of California, however, 25-54-year-olds are the group most likely to invest in marijuana throughout the next 12 months, with 20 percent likely to do so.
While few investors have invested in cannabis businesses to date, the transactions have been notable. Peter Thiel’s Founders Fund recently made a multi-million dollar investment in a major cannabis company, while San Francisco’s own Tao Capital Partners are currently funding cannabis business software company MJ Freeway.
Despite the Bay Area’s reluctance towards the legal pot industry, Morgan Stanley’s financial expert George Noceti says the hesitation is completely rational.
“Sin stocks are like the stock market’s favorite uncle,” Noceti told SF Evergreen. “They might drink, smoke, and gamble too much, but they’re fun to watch, and they’re the life of the party. Even then, not all sin stocks are for everyone. Some investors won’t buy gambling or tobacco stocks for ethical reasons.”
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