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Canadian Mushroom Stocks: Top Picks, Pros and Cons

Written by Tim-bot
Reviewed by Friedrich Odermann Fact-checked by Ed Weinberg
Updated 11/17/2023 15 min read

Mushroom stocks in Canada refers to companies in the Canadian market focused on the cultivation, research, and development of psychedelic mushrooms. These stocks present a new world of potential for both medical treatment and investor growth, specifically in the mental health space.

You should read this article because it dives deep into the burgeoning sector of Canadian mushroom stocks, offering insights into the top picks, pros, and cons for traders eyeing this unique market.

I’ll answer the following questions:

  • What are mushroom stocks in Canada?
  • How do these stocks differ from traditional stocks?
  • What is the current state of psychedelic stocks in Canada?
  • Why should you consider investing in psychedelic stocks in Canada?
  • What are the top psychedelic stocks in Canada for 2024?
  • Are psychedelic stocks legal investments?
  • What are the pros and cons of investing in psychedelic stocks?
  • How can you buy mushroom stocks in Canada?

Still with me? Good. Now let’s dig into the details.

What Are Mushroom Stocks in Canada?

Mushroom stocks in Canada are companies listed on various markets like the TSX and NEO that center around the cultivation and research of psychedelic mushrooms. These aren’t your grandma’s canned mushrooms; we’re talking about substances like psilocybin, which have shown promise in mental health treatment. In the same way, you’d carefully pick penny stocks or cannabis stocks, diving into mushroom stocks requires attention to company development stages, trials, and market potential. Look, I’ve seen too many traders toss their hard-earned cash into stocks without doing their homework. Don’t be that guy.

If you need a reminder on the golden days of pot stocks — before the crash — watch this video … the advice is still good:

Keep an eye on phases of clinical trials and research. If you’re accustomed to scanning balance sheets and revenue results, you’ll need to factor in additional data points like trial approvals and stages of testing. Always remember, trading is about recognizing patterns. I’ve been teaching and trading long enough to know that jumping into any sector without adequate knowledge is a shortcut to blowing up your account.

The Rise of Psychedelic Stocks in Canada

As more researchers worldwide look into the efficacy of psychedelics, the Canadian sector is seeing a boom in both demand and investment. Research and development are skyrocketing, positioning Canada at the forefront of this market. Since the market cap of these companies is often smaller compared to other industries, the growth potential is massive. It’s not unlike when I started trading tech stocks; the upside can be extraordinary if you time it right.

Just as the cannabis stocks had their moment, now it’s time for psychedelic stocks to take the world stage. But remember, more attention means more competition and volatility. You’ve got to keep your eyes peeled for the next play, the next news release, and how global regulations might impact these companies. If you want to trade patterns successfully, you need to understand the market conditions and trends, the same way I’ve taught thousands of traders over the years.

Why Invest in Psychedelic Stocks in Canada?

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Canada is leading the charge in psychedelic research. From Vancouver to Toronto, biotech companies are engaged in revolutionary research and development. It’s attracting capital from investors, who see the potential for substantial returns. Ever wondered how I make consistent gains? It’s because I always evaluate the risk-to-reward ratio, just like you should be doing with these stocks.

Besides growth prospects, Canada offers a regulatory framework that is more favorable than most countries. For instance, the Minister of Health has been open to granting exemptions for psilocybin trials. This kind of support provides companies a cushion to develop solutions for issues like ADHD, substance abuse, and post-traumatic stress disorder. Before you commit a portion of your portfolio to this sector, ensure you’re clear on the specific conditions that make these stocks a good or bad play.

Canada isn’t just leading in psychedelic research; it’s also a hotbed for biotech innovation. Companies in the biotech sector are increasingly collaborating with psychedelic firms to accelerate research and development. This synergy could be a game-changer, offering more robust scientific backing and potentially faster FDA approvals. If you’re intrigued by the biotech angle, you might want to explore my top picks for biotech stocks in Canada for 2024.

Top Psychedelic Stocks in Canada for 2024

My mushroom stock picks are:

In 2024, you can’t talk about Canadian psychedelic stocks without mentioning Compass Pathways (NASDAQ: CMPS), Cybin Inc. (AMEX: CYBN), Mind Medicine (NASDAQ: MNMD), and Numinus Wellness Inc (OTCPK: NUMIF). These companies are becoming the cornerstone of the psychedelic stock space, both in research and market capitalization. As someone who’s been navigating different markets for years, trust me when I say, always dig into the financials and the science behind each firm.

Before you send in your orders, take note: I have NO plans to trade these stocks unless they fit my preferred setups. This is only a watchlist.

The best traders watch more than they trade. That’s what I’m trying to model here. Pay attention to the work that goes in, not the picks that come out.

Sign up for my NO-COST weekly watchlist to get my latest picks!

Compass Pathways (NASDAQ: CMPS)

My first Canadian mushroom stock pick is Compass Pathways (NASDAQ: CMPS).

Compass Pathways is listed on the Nasdaq and focuses on psilocybin therapy for depression. Their leading drug, Comp360, is gaining attention. If you’re thinking about adding this to your portfolio, check out its latest phase results and FDA approvals. Trading this stock isn’t much different from trading tech stocks; the catalysts matter. Study their pipeline and approval stages because the next news release can drastically change the stock price.

Cybin Inc. (AMEX: CYBN)

My second Canadian mushroom stock pick is Cybin Inc. (AMEX: CYBN).

Cybin operates from Toronto but is trading on AMEX. Focused on neurology and mental wellness, it’s developing psychedelic substances like DMT and psilocybin. Evaluate their latest data and technologies before you make a move. In my years of trading, I’ve learned that numbers don’t lie; always check a company’s operational performance and financial health.

Mind Medicine (NASDAQ: MNMD)

My third Canadian mushroom stock pick is Mind Medicine (NASDAQ: MNMD).

Mind Medicine or MindMed is a game-changer in treating addictions and mental illnesses. Their operations extend beyond Canada, further diversifying your potential gains. Just as I diversify across sectors and trading styles, consider MindMed as a diverse play in your psychedelic stock portfolio. Pay attention to their trials on LSD and other substances as well.

Numinus Wellness Inc (OTCPK: NUMIF)

My fourth Canadian mushroom stock pick is Numinus Wellness Inc (OTCPK: NUMIF).

Listed on the OTCPK, Numinus is a smaller player but with considerable promise. They’re into research and clinical trials, much like MindMed. Now, if you’ve been following my teachings, you know small companies often present the best opportunities for quick gains. Still, be wary; check their trial phases and any partnerships or licenses they may have acquired.

Are Psychedelic Stocks Legal?

Let’s cut through the noise: Psychedelic stocks are legal investments, but the substances these companies deal with may fall under varying regulatory frameworks. Legal does not mean without risks. Whether you’re new to trading or have been learning from my experiences, know that legality doesn’t remove volatility or risk.

Psilocybin, LSD, and other substances are still under intense scrutiny by health experts and government bodies, including the FDA. Companies need to adhere to strict regulations, undergoing multiple phases of testing and trial before they can commercialize their products. It’s not different from the hurdles any biotechnology company would face.

Investing in Psychedelic Stocks: Pros and Cons

There are compelling reasons to invest in psychedelic stocks. The potential for revolutionary treatment in mental health can’t be ignored. That means high growth potential and market demand. If you’ve absorbed my lessons, you know that understanding both sides of the coin is essential for success.

However, the sector is new, making it inherently risky. All of North America is their market, and the road to FDA approval is filled with obstacles. Plus, these stocks are highly susceptible to news and market sentiment. As someone who’s made my fair share of losses and gains, know that volatility can be both an ally and an enemy. Make sure you’re prepared for both scenarios.

Psychedelic stocks share similarities with growth stocks: both can offer high returns but come with elevated risks. Emotional discipline is crucial. You can’t let FOMO drive your decisions. If you’ve been burned by growth stocks before, you know what I’m talking about. For a deeper understanding of the emotional and financial complexities of growth stocks, check out my article on growth stock blues.

Pros of Psychedelic Stocks

Here’s the deal: the pros include strong research pipelines, growing market demand, and significant attention from both the medical community and investors. Look at it this way, if you’re selective and wise, like the way I pick my trades, you could hit some home runs here. Companies like Compass and MindMed are demonstrating the ability to potentially change lives through their research.

Another advantage is the regulatory framework in Canada, which is favorable for these companies. As someone who’s seen both the ugly and good sides of market regulations, favorable conditions can be a massive boon for investors.

Cons of Psychedelic Stocks

But wait, there’s a flip side. The cons include high volatility, market sensitivity to news, and the length of time it takes for products to reach the market. Plus, there’s a growing number of competitors entering the space, making it harder to identify the true winners. If you’ve been following me, you know I always say, “Cut your losses quickly.” The same principle applies here. Know when to step back if things don’t align with your strategy.

The road to FDA approval is rocky, and not every company will make it. Just as I teach my students to recognize signs of a bad trade, it’s crucial to keep an eye on developments that could signal a downside. Being caught off guard is a surefire way to damage your portfolio.

Are Psychedelic Mushroom Stocks Right for You?

Let’s get to the kernel of it. Psychedelic mushroom stocks fall into a unique niche in the biotech industry. But just because there’s buzz doesn’t mean it aligns with your financial goals. You need to assess your risk tolerance and finances before jumping in. Unlike traditional shares, the commercialization of psychedelic medicines is still in its infancy. If your finances can’t handle the volatility, these stocks might not be right for you. This is not for cancer patients looking for immediate pain relief; it’s for traders looking for a calculated chance in a unique industry.

How To Buy Mushroom Stocks in Canada

The first step to buy mushroom stocks in Canada involves finding the right brokerage platform. Popular platforms like Psyk ETF offer access to a variety of shares in this sector. Before you proceed, know that the article’s author suggests caution. Companies like Numinus Health are making strides in commercialization but read the disclaimer and consult professionals before you invest your hard-earned funds. Consider the steps carefully, as not every brokerage will give you access to all the types of assets you might be interested in.

While you’re exploring the psychedelic sector, don’t overlook the potential of penny stocks that pay dividends. These stocks can offer a different risk profile and might be a good addition to diversify your portfolio. However, remember that high dividends can sometimes be a red flag, indicating that the company is trying to attract investors for the wrong reasons. If you’re curious about this angle, read my guide on penny stocks that pay dividends.

Platforms to Use for Mushroom Stock Trading

When it comes to trading platforms, variety is your friend. Brokerages differ in fees, types of securities they offer, and the level of professional advice available. In Canada, platforms like Interactive Brokers, Questrade, and Wealthsimple Trade can give you access to a multitude of psychedelic shares. Whether your goal is long-term or short-term, the right platform meets your specific needs in a manner that benefits you.

Key Takeaways

The psychedelic stock industry is still emerging, so tread cautiously. From the cultivation license required for the production of lysergic acid diethylamide to the potential effects on mental health clinics, the sector is intricate. Your needs might differ from those of traditional stock traders, so align your finances and business expectations accordingly. In conclusion, there’s potential, but also a lot of complexities.

Trading isn’t rocket science. It’s a skill you build and work on like any other. Trading has changed my life, and I think this way of life should be open to more people…

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We don’t accept everyone. If you’re up for the challenge — I want to hear from you.

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Trading is a battlefield. The more knowledge you have, the better prepared you’ll be.

What Canadian mushroom stocks are on your watchlist? Let me know in the comments — I love hearing from my readers!

Frequently Asked Questions

How Do Psychedelic Stocks Differ from Traditional Stocks?

Traditional stocks might focus on commercialization and sale, while psychedelic stocks are still grappling with issues like possession and legality in various states. The business models are vastly different, with traditional companies often having a more stable role in the market.

What Are the Tax Implications of Investing in Psychedelic Stocks?

Taxation varies by places and types of assets you hold. In Canada, for instance, the export and sale of psychedelic compounds could have different tax implications than traditional stocks. Always consult professionals to navigate this.

How Do I Choose the Right Psychedelic Stock to Invest In?

This question’s answer lies in how well you understand the business and finances of each biotech company you’re considering. Companies like Numinus Health are making significant inroads, but due diligence is your best friend. Keep an eye out for their CEOs’ visions, research the amounts they’re investing in R&D, and what steps they’re taking towards making their products more accessible in clinics. Remember, the goal is not to invest but to trade smartly.

What Are the Equivalents of Psychedelic Stocks for Investment Purposes?

When it comes to finding equivalents for investment purposes, consider sectors that are similarly emergent and volatile. Think cutting-edge technologies or frontier markets where the risk and reward profiles could resemble psychedelic stocks.

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Timothy Sykes

Tim Sykes is a penny stock trader and teacher who became a self-made millionaire by the age of 22 by trading $12,415 of bar mitzvah money. After becoming disenchanted with the hedge fund world, he established the Tim Sykes Trading Challenge to teach aspiring traders how to follow his trading strategies. He’s been featured in a variety of media outlets including CNN, Larry King, Steve Harvey, Forbes, Men’s Journal, and more. He’s also an active philanthropist and environmental activist, a co-founder of Karmagawa, and has donated millions of dollars to charity. Read More

* Results are not typical and will vary from person to person. Making money trading stocks takes time, dedication, and hard work. There are inherent risks involved with investing in the stock market, including the loss of your investment. Past performance in the market is not indicative of future results. Any investment is at your own risk. See Terms of Service here

The available research on day trading suggests that most active traders lose money. Fees and overtrading are major contributors to these losses.

A 2000 study called “Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors” evaluated 66,465 U.S. households that held stocks from 1991 to 1996. The households that traded most averaged an 11.4% annual return during a period where the overall market gained 17.9%. These lower returns were attributed to overconfidence.

A 2014 paper (revised 2019) titled “Learning Fast or Slow?” analyzed the complete transaction history of the Taiwan Stock Exchange between 1992 and 2006. It looked at the ongoing performance of day traders in this sample, and found that 97% of day traders can expect to lose money from trading, and more than 90% of all day trading volume can be traced to investors who predictably lose money. Additionally, it tied the behavior of gamblers and drivers who get more speeding tickets to overtrading, and cited studies showing that legalized gambling has an inverse effect on trading volume.

A 2019 research study (revised 2020) called “Day Trading for a Living?” observed 19,646 Brazilian futures contract traders who started day trading from 2013 to 2015, and recorded two years of their trading activity. The study authors found that 97% of traders with more than 300 days actively trading lost money, and only 1.1% earned more than the Brazilian minimum wage ($16 USD per day). They hypothesized that the greater returns shown in previous studies did not differentiate between frequent day traders and those who traded rarely, and that more frequent trading activity decreases the chance of profitability.

These studies show the wide variance of the available data on day trading profitability. One thing that seems clear from the research is that most day traders lose money .

Millionaire Media 66 W Flagler St. Ste. 900 Miami, FL 33130 United States (888) 878-3621 This is for information purposes only as Millionaire Media LLC nor Timothy Sykes is registered as a securities broker-dealer or an investment adviser. No information herein is intended as securities brokerage, investment, tax, accounting or legal advice, as an offer or solicitation of an offer to sell or buy, or as an endorsement, recommendation or sponsorship of any company, security or fund. Millionaire Media LLC and Timothy Sykes cannot and does not assess, verify or guarantee the adequacy, accuracy or completeness of any information, the suitability or profitability of any particular investment, or the potential value of any investment or informational source. The reader bears responsibility for his/her own investment research and decisions, should seek the advice of a qualified securities professional before making any investment, and investigate and fully understand any and all risks before investing. Millionaire Media LLC and Timothy Sykes in no way warrants the solvency, financial condition, or investment advisability of any of the securities mentioned in communications or websites. In addition, Millionaire Media LLC and Timothy Sykes accepts no liability whatsoever for any direct or consequential loss arising from any use of this information. This information is not intended to be used as the sole basis of any investment decision, nor should it be construed as advice designed to meet the investment needs of any particular investor. Past performance is not necessarily indicative of future returns.

Citations for Disclaimer

Barber, Brad M. and Odean, Terrance, Trading is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors. Available at SSRN: “Day Trading for a Living?”

Barber, Brad M. and Lee, Yi-Tsung and Liu, Yu-Jane and Odean, Terrance and Zhang, Ke, Learning Fast or Slow? (May 28, 2019). Forthcoming: Review of Asset Pricing Studies, Available at SSRN: “https://ssrn.com/abstract=2535636”

Chague, Fernando and De-Losso, Rodrigo and Giovannetti, Bruno, Day Trading for a Living? (June 11, 2020). Available at SSRN: “https://ssrn.com/abstract=3423101”