The revival of the psychedelic renaissance is creating a bright future for investors. With strong clinical research favoring this new generation of revolutionary drugs, an increasing number of investors are getting attracted to the space. Early projections for the space, including a data report from a Canadian exchange, have forecasted the “shroom boom” alone to reach a US$7 billion value by 2027! While this emerging market is certainly exciting, there are a few key points every investor, amatuer or experienced, can benefit from heeding in this industry. This guide will explore three important things every psychedelic investor should know to help guide them through their exciting journey into this dynamic market. 

 

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  1. Psychedelic investing is very different from that of cannabis: Despite being used to treat countless conditions, the US Food & Drug Administration has only approved cannabis to treat two rare forms of childhood epilepsy. Contrast this with the incredibly promising clinical data supporting psychedelic use in the treatment of massive public health issues, including depression, anxiety, addiction, and PTSD. The United States Food & Drug Administration went so far as to call psilocybin, the active ingredient in magic mushrooms, a “breakthrough therapy” for depression. MDMA is already being used in phase three clinical trials, while many ketamine clinics across North America are already in full swing. While cannabis may indeed be an incredibly effective band-aid, it pales in comparison to the potential that psychedelic medicine has in revolutionizing the treatment of notoriously stubborn neuropsychiatric conditions. New investors in this space are advised to be wary when trying to draw parallels between psychedelic and cannabis capital markets, as there are several, very notable distinctions.

    psychedelic investing is not like cannabis
  2. Invest in long-term plays like drug discovery: Long-term drug discovery in the psychedelic medicine space by far contains the lion’s share of capital, dominating 70% of the market. All current indications point to a promising, lasting future for psychedelic medicine. Decades of extensive research into the receptors psychedelics act upon, such as serotonin, combined with a whopping 264 ongoing drug trials into psychedelic compounds and their derivatives, suggests immense promise for this emerging industry. New investors are advised to seek out long-term plays, (such as drug development by manufacturers that understand the rigorous regulatory landscape for psychoactive drugs), and to avoid “pump and dump” pitfalls in the evolving capital markets.

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  1. Think critically and take an evidence-based approach: The rapidly materializing psychedelic medicine industry is as nuanced as it is complex. New investors are advised to think critically and take an evidence-based approach in developing their investment strategies. Ensuring there is a clear path for sustainability and profit is of utmost importance to investors and entrepreneurs in the space today. Indeed, the allure of making a “quick buck” has led to some newsworthy downfalls in the cannabis space. Follow the research (not the “hype cycle”) and validate that the players looking for capital have a clearly defined path to market, are privy to the complexities of clinical trials, and have long-term plays for an ethical, sustainable product.

 

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Preparing For The Future of Psychedelic Investing 

 

As research continues to expand into these promising compounds and their vast therapeutic potential, market players are beginning to ask themselves how to get involved and mindfully invest in the space.  With the Canadian markets already offering early stage investment opportunities, now is the best time to get educated and develop a sound, long-term psychedelic investment strategy. The three tips mentioned in this guide will certainly help guide anyone interested in this revolutionary emerging market.