“There are now at least 130 public companies that claim to be in the pot business, and most of them are so-called penny stocks, defined by the SEC as stocks trading for less than $5 a share.  ‘They’re full of shenanigans and charlatans,’ says Brendan Kennedy, chief executive officer of Privateer Holdings, a firm that invests in the marijuana industry. ‘Most of them will revert to zero.’  On some days, cannabis-related stocks account for 15% or more of all penny-stock trading, according to OTC Markets Group Inc., which runs the trading venue once known as the pink sheets. Since 2012, the market capitalization of those stocks has soared from $500 million to more than $7 billion.”

http://www.bloomberg.com/news/2014-06-18/legal-pot-sets-off-penny-stock-frenzy.html

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