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Beauty Industry Tries Pot Luck: ETF in Focus

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The cannabis industry is at cloud nine right now. Growing legalization globally, increasing potential of cannabis-induced food, beverage and tobacco industry and a wave of mergers and acquisitions have sent marijuana stocks and ETF on a tear (read: Tilray's Deal to Buy Hemp Food Maker Bolsters Marijuana ETF).

The space gained momentum in mid-2018, suffered a correction in the fourth quarter and has skyrocketed in 2019. This year, the fund ETFMG Alternative Harvest ETF (MJ - Free Report) is up 44.8% (as of Feb 20, 2019) (read: 4 Reasons Why Marijuana Stocks & ETFs Could Be on a High in 2019).

Beauty Industry: The New Attraction for Pot Stocks

With legalization of cannabis in Canada in October 2018, several U.S. states walking the same line and many other countries approving it for medical purposes, the attitude toward the plant became more acceptable. Cannabis is known for its efficacy in medicinal uses and this is what the beauty industry is cashing in on.

Of late, the popularity of beauty products induced with cannabidiol (CBD) – natural non-psychoactive compound found in plants of the Cannabis genus” – has grown. Analysts at Piper Jaffray see huge growth for marijuana stemming from the beauty industry. This industry will boost the overall CBD market, making it worth $50 billion to $100 billion, as quoted on CNBC.

High-end retailers like Sephora, Barneys and Neiman Marcus are showcasing such beauty products. In September 2018, French beauty retailer Sephora launched its first cannabis-infused cosmetics brand called High Beauty. Estee Lauder (EL - Free Report) ’s Origins launched a CBD-infused green face mask in September. Neiman Marcus keeps CD-induced products from Sagely Naturals, Cannuka, Cannabliss Organic, Code of Harmony, Ildi Pekar, Vertly and Yuyo Botanics on its shelves.

Walmart (WMT - Free Report) and Ulta Beauty (ULTA - Free Report) sell hemp topicals already, per the source. Facial shop Heyday launched a service exclusive to its Los Angeles location. Piper Jaffray analysts expect further retailer developments in CBD-packed beauty products, per CNBC.

According to market research company Brightfield Group, hemp CBD market is likely to outpace the rest of the marijuana market combined by 2022, helped by medicinal, recreational and cosmetic use.

Encouraging International Outlook

International opportunities for marijuana producers.So, no wonder, globally known beauty brands will soon jump on the bandwagon of launching CBD-induced products, depending on the growing acceptance of the plant. Internationally, markets are opening up in Germany, Australia, South Korea and the United Kingdom. So, investors can definitely tap this emerging corner of the hemp industry by investing in MJ (read: Forget Mixed Pot Earnings; Bet on ETF on Growth Prospects).

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