Marijuana Wins Big On Election Night, But Marijuana Stocks Lose

The presidential race was hotly-contested on Tuesday night, but the marijuana legalization movement nearly ran the tables in the nine states with marijuana on the ballot.

Recreational and/or medical marijuana initiatives passed in eight of the nine states, including California, Florida, Massachusetts and Nevada. The only blemish on a tremendous night for the marijuana legalization movement was a defeat in Arizona.

The marijuana movement is celebrating a major election victory on Wednesday, but marijuana stock investors are taking profits on stocks that have surged headed into the election. The MJIC U.S. Marijuana Index was down 1.6 percent in mid-day trading, with stocks like Kush Bottles Inc KSHB, Cannabics Pharmaceuticals Inc CNBX and Cannabis Sativa Inc CBDS each down more than 10 percent.

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The post election selloff in these red-hot marijuana stocks was predictable considering the huge run these stocks have been on so far this year.  Kush Bottles is up 98 percent in 2016, Cannabis Sativa has surged 865 percent this year and Cannabics Pharmaceuticals is up a staggering 2,500 percent.

Now that the primary near-term marijuana-related catalyst has come and gone, many of these OTC-listed marijuana stocks will likely come back down to earth as traders book gains. The MJIC U.S. Marijuana Index remains near its 52-week high, implying many of these stocks could have significant further downside in coming weeks.

however, big names like GW Pharmaceuticals PLC-ADR GWPH and Zynerba Pharmaceuticals Inc ZYNE sold off in the morning, but were trading in the green by Wednesday afternoon.

Despite victories in eight U.S. states, marijuana remains illegal in the U.S. under federal law.