Most people hate Mondays because it’s the start of the work week. Monday for me this week was waking up to see my CannTrust shares down 23% because they decided to grow product in rooms which were unlicensed. They did eventually receive the license for those 5 rooms but they just couldn’t wait.
When a story like this rocks your stock it’s like getting punched in the face. I was already down 7% before this scandal broke out. I don’t know why but I didn’t sell my shares even though I believed it would just keep going down and maybe even down next to zero. My mistake was not taking the time to think about it. When you’re down so much on a stock sometimes the automatic reaction is to do nothing because you feel as if the most of the damage must be done.
My book cost is $5000 so not the end of the world. Some people out there have well-in to the 5 digits and 6 digits. CannTrust was supposed to be one of the safer marijuana stocks and more well-liked by institutional investors but so was Aphria. I was lucky enough to pick up shares of Aphria the week before their scandal hit.
The sad part about this is that I was up 100% on my CannTrust shares late last year. It crashed 50% from the top but rebounded a few months later to about 80% in the green. So I was up $5000 and now I can potentially be down $5000 if it goes to zero.
I’m not expecting it to go to zero since the pesticide scandal with Mettrum and Organigram never materialized any great consequences. There’s some lessons here as usual when it comes to the stock market.
In the past year I have traded CannTrust here and there for a $2000 profit. I could break even after all is said and done. Earlier this year I held a bigger position in CannTrust but luckily I sold most of it. I had lost confidence in them already from a lack of disclosure on their part regarding the president departing and building permit issues.
- Don’t get too greedy. When I first bought CannTrust shares my plan was to sell at $13. When it hit $14 I didn’t do anything.
- When very bad news comes out the best idea is to sell your shares even if they’ve bled a fair amount.