High returns put fun in fungi

Alternative investments (or alternate assets) are any investment class that excludes stocks, bonds and cash — and they’re nothing new. People have been hedging their bets on art, antiques, wine and even stamps for generations, but now there are unique and more exciting investments that have piqued the interest of intrepid investors the world over.

The decriminalisation and destigmatisation of cannabis and mushrooms (of the non-psychoactive variety) are changing the game. Investors, casual and otherwise, are trying their hand at  making a mint off these novel investments as medical studies affirm the broad treatment applications that both provide.

Although research is ongoing and far from conclusive, cannabis has shown promise in helping to treat some cancers, epilepsy and Alzheimer’s. The medical fraternity is starting to acknowledge that cannabis can treat the pain and nausea associated with chemotherapy and the muscle stiffness of those who have multiple sclerosis. 

The plant has always been popular, but it is only now revealing its potential as a legitimate cash crop. Following Lesotho’s decision to legalise the cultivation of the plant in 2008, many lucrative ventures have sprung up in the landlocked kingdom, which is making history as the first African country to become certified to supply the EU with pharmaceutical-grade cannabis.

According to SilverLeaf Investments’ joint chief executive Pierre van der Hoven, there are already ways to get involved. In the Jaco Maritz book How We Made It in Africa, Van Der Hoven is quoted: “The key areas of investment are the cultivation of cannabis, followed by the extraction of oil from the plant, testing laboratories, and the retail and branding of cannabidiol (CBD) products. The emergence of CBD products in big South African retail pharmacies such as Clicks and Dis-Chem has brought investment prospects at the retail end of the value chain. As the industry grows, there will be a demand for services such as greenhouses, nutrients, plant growers, quality control systems and software.”

South Africa is the fourth-largest cannabis producer globally and with rumours swirling around the regulation here, the potential of this already booming R28-billion industry is set to explode. 

Functional mushrooms

In much the same way that CBD had a huge rise in popularity a few years ago, functional mushrooms are making their way onto the wellness scene. Revered for centuries in Chinese and Ayurvedic medicine, these non-toxic, non-psychoactive fungi are known for their abilities to combat stress, improve concentration and aid the body’s natural ability to heal itself — and there are scientific studies to back these claims. 

Global figures suggest that the functional mushroom market will exceed $555-billion by 2026, and supplement brand Goodmind is leading the way locally, touting the power of their non-toxic, non-psychoactive properties to help users combat stress and achieve balance and calm.

Although they’re on a longer route to legitimacy, psychedelic mushrooms (and their psychoactive chemical, psilocybin) are on the rise as an alternative investment, thanks to their viability as an alternative medicine. Various studies have shown their efficacy for treating alcohol, drug and nicotine addiction as well as cluster headaches and depression. 

With mental health disorders in-creasing globally, pharmaceutical giants worldwide are looking for products that are efficient and safe; given that “shrooms” are natural, non-habit forming and non-toxic, their popularity is sure to increase. Institutions such as the  Psychology Society of South Africa have already begun to canvas their members regarding their attitude towards psychedelic treatment — a strong indication of wider adoption within the medical fraternity, and, by extension, the public.

The raised profit ceiling for these commodities makes cannabis and mushrooms attractive for potential investors, and the potential for profit in less mature local industries is higher than elsewhere. Neither industry is yet saturated with investors, making getting in on the ground floor a realistic aspiration. 

However you choose to build an investment portfolio, one thing’s for sure: new and unconventional investment opportunities are opening up a wealth of options for budding investors. Beyond pure profit, investing in cannabis and mushrooms may help advance life-changing treatments for mankind — a moral incentive for building your fortune.

This article was commissioned for #OnTrend

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