Some investors may be concerned about buying stocks when the S&P 500 is up double-digits in less than six months. That’s understandable. As I write this, the S&P 500 index has rallied 16.2%, while the market is up 49% over the past five years and 217% over the past decade.

But rather than adopt an overly defensive posture, I’ve been telling my Fast-Track Millionaire readers something different… You see, I think the antidote is to invest in rapid-growth industries — places where future profits are likely to outgrow the market by a wide margin. 

After all, if we can identify the companies delivering the kind of growth I’m talking about — it won’t matter what the rest of the market is doing… the shares of these companies will be positioned to keep delivering.

This explains the recent strength in tech, for example. And while there’s plenty of growth in that sector — and you should be paying close attention to it (as we do over at Fast-Track Millionaire)… I’m not here to talk about tech today. 

Instead, I’d like to touch on another growth industry — where the action has largely been more muted — the fledgling cannabis sector. 

The Next Growth Frontier
This sector — which, by some estimates, can expand to $500 billion in annual sales (comparable to the global hotel industry) literally didn’t exist a decade ago. And today it still does not have a strong foothold in the United States. As Canada legalized recreational marijuana in October of last year (only the second country in the world to do so), it’s the Canadian companies that set the tone.

While the United States is significantly behind Canada in legalizing recreational use, recently another milestone was reached as Illinois became the 11th state in the country to legalize the recreational use of marijuana by adults. 

But there is another positive to the legalization of pot – the tax revenue that newly legal sales can generate. In Illinois, for example, where adult usage will become legal starting in January 2020, pot is projected to generate over $57 million in new tax and fee revenue in fiscal 2020, which begins on July 1. Tax revenue generated by cannabis is expected to nearly triple in fiscal 2021, and to grow to as high as $375.5 million in 2024.

Just as with any new business, the business of growing and selling cannabis is risky. But one can argue that for growth investors it might be even riskier to fully ignore this sector — it’s not often they get to jump on the very beginning of what is shaping up to be a huge business.

That’s why we have exposure to this sector in a number of ways over at Fast-Track Millionaire. Today, I’d like to update you on two of them…

The Medical Play
It’s been long argued that medical properties of cannabis can address a variety of maladies, including helping solve the growing opioid epidemic.

Our portfolio already has two positions that I expect to continue to benefit from the progress — legal and scientific — that is being made in the industry. One is GW Pharmaceuticals (Nasdaq: GWPH), whose Epidiolex drug is approved for the treatment of two rare forms of epilepsy: Dravet syndrome and Lennox-Gastaut syndrome. 

As the first and still only FDA-approved drug derived from the cannabis plant, Epidiolex has been a successful drug — as of April 2019, just five months after the launch, 10,000 patients have already been treated with it. In the first full quarter on the market, the drug’s actual sales of $33.5 million have been more than double analyst expectations. 

The “Legalize It” Play
Our second pot-focused stock, Canada-based Canopy Growth (NYSE: CGC), has also been successful in building up its own strategy — which is to enter the U.S. market as soon as it becomes legally possible and to hit the ground running as soon as that happens.

There’s just one problem… 

#-ad_banner-#Management changes have been weighing on shares ever since it was announced that co-CEO Bruce Linton was stepping down effective immediately (and that his co-CEO Mark Zekulin has agreed to become the sole CEO and will work with the board to begin a search for the company’s new leader). Reportedly, the board made the change because it felt the company needed a new leader for its next growth phase. 

But the decline indicates that the market isn’t all that worried about the future of Canopy. From July 3, when Canopy announced the change, the stock has only declined a few percentage points (versus a 1% gain in the market) as I write this.

With that said, on the plus side, one big step in achieving its long-term goal has just been completed. On June 19, CGC announced that its shareholders approved — with 99.05% of the vote — the acquisition of Acreage Holdings (OTC: ACRGF), an owner and operator of cannabis licenses and assets in the United States. The company also approved the issuance of common shares of Canopy Growth and certain amendments to outstanding CGC warrants in connection with the acquisition.

This $3.4 billion acquisition is conditional — the deal will not happen unless cannabis manufacturing and sales become federally legal in the United States (with an expiration date of seven and a half years if this main condition does not come to fruition). Meanwhile, both companies will continue to operate independently.

Buying Acreage Holdings is a shrewd — albeit somewhat risky — move. This company is unique in that Acreage has been investing in real estate, cannabis growers, processors, and dispensaries across the country — and has numerous licenses across the United States, thanks to its early start, good management and strong partnerships with regulators, physicians and medical researchers.

Of course, this deal might not pan out — it’s conditional on pot becoming legal in the United States. But if and when that happens, CGC will be in the catbird’s seat relative to the competition. Meanwhile, CGC continues its work on legal hemp — the company now owns and has contracted hemp operations in seven states: California, Colorado, Kentucky, New York, North Carolina, Oregon and Pennsylvania, with planting already underway, using a mixture of high-CBD varieties and high-fiber genetics.

Action to Take 
If you’re looking for a “pharma”-like way to invest in cannabis, then GWPH is the way to go. We’re up by about 35% on this position since adding it to the Fast-Track Millionaire portfolio in January, and I am maintaining my “Buy” rating on the stock.

There’s a lot to like about Canopy even though Linton, who is largely responsible for the company’s successful business strategy, is no longer at the helm. Up 44% year to date, the deal with Acreage Holdings comes on the heels of its partnership with beer company Constellation Brands (NYSE: STZ). Canopy remains a leading cannabis company with a strong potential to benefit as pot goes mainstream and is still a “Buy” at today’s prices.

P.S. The two stocks I mentioned here are just the tip of the iceberg… There’s a lot more to say about the cannabis space, and you’ll want to know the full story before investing. Go here to check out my special briefing on this huge trend and get even more ways to profit.