Global X ETFs Survey: U.S. Opinions on Recreational Cannabis

Sep 7, 2021

In May 2021, we surveyed 557 U.S. respondents regarding their opinions towards recreational cannabis. 2020 was a landmark year for the state-level cannabis industry in the U.S. and 2021 is shaping up to be one as well. 7 states have legalized recreational, or adult-use, cannabis, since last November, bringing the total to 18 plus Washington, D.C., though it remains federally illegal. We believe that the U.S. cannabis market is at an inflection point where continued state legalization will further accelerate sales and help cannabis companies get their footing in advance of potential federal legalization.

Key Takeaways

  • A majority of Americans support legalizing cannabis on the federal level in the U.S.
  • Older millennials & younger gen-Xers support federal legalization, followed by gen-Z & older demographics
  • Positive attitudes toward the federal legalization of recreational cannabis have increased in recent years
  • More Americans plan on increasing their recreational cannabis use than those who plan on decreasing use
  • Gen X & baby boomers plan on increasing recreational cannabis use as they approach retirement years
  • Americans prefer legalizing & taxing cannabis to generate state tax revenues over alternative options
  • Central states most prefer legalizing & taxing cannabis for state revenue, Southern states show least support
  • A majority of Americans believe cannabis should be taxed similarly to alcohol/tobacco
  • Those in support of legal federal cannabis believe it should be taxed similarly or less than tobacco/alcohol

Click here to download the Global X ETFs Survey on U.S. Opinions on Recreational Cannabis

Investing involves risk, including the possible loss of principal. The investable universe of companies in which POTX may invest may be limited. The Fund invests in securities of companies engaged in Healthcare and Pharmaceutical sectors. These sectors can be affected by government regulations, expiring patents, rapid product obsolescence, and intense industry competition. International investments may involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles or from social, economic or political instability in other nations. POTX is non-diversified.

POTX’s investments are concentrated in the cannabis industry, and the Fund may be susceptible to loss due to adverse occurrences affecting this industry. The cannabis industry is a very young, fast evolving industry with increased exposure to the risks associated with changes in applicable laws (including increased regulation, other rule changes, and related federal and state enforcement activities), as well as market developments, which may cause businesses to contract or close suddenly and negatively impact the value of securities held by the Fund.  Cannabis Companies are subject to various laws and regulations that may differ at the state/local, federal and international level. These laws and regulations may significantly affect a Cannabis Company’s ability to secure financing and traditional banking services, impact the market for cannabis business sales and services, and set limitations on cannabis use, production, transportation, export and storage. The possession, use and importation of marijuana remains illegal under U.S. federal law. Federal law criminalizing the use of marijuana remains enforceable notwithstanding state laws that legalize its use for medicinal and recreational purposes. This conflict creates volatility and risk for all Cannabis Companies, and any stepped-up enforcement of marijuana laws by the federal government could adversely affect the value of the Fund’s investments. Given the uncertain nature of the regulation of the cannabis industry in the United States, the Fund’s investment in certain entities could, under unique circumstances, raise issues under one or more of those laws, and any investigation or prosecution related to those investments could result in expense and losses to the Fund.

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