[VIDEO ANALYSIS] Is Queensland Bauxite high on cannabis?

William: Okay, question two. Norman for New South Wales asks, "What do you think about Queensland Bauxite (QBL) getting into medical cannabis?"

Shannon: Medicinal cannabis.

William: Medicinal, sorry.

Shannon: Well, I'd never heard of Queensland Bauxite being in the market of medicinal cannabis, you know you have to be completely asleep to not notice that this is a little bit of a boom now. The amount of IPOs that are now being offered into these medicinal cannabis companies, or medical cannabis companies, is astonishing.

This one says it all about what a little boom this is. Queensland Bauxite is a Bauxite explorer and well, one day, hopeful producer that has up and decided that no longer are they going to be able to have a future in that and has completely pivoted into the new trend.

They're doing so without cash as well. They're doing so by issuing new shares. I think for the company that they're buying, it's a nice way to get exposure, to list on the ASX, but there's no real logic behind the merger between these two.

It's tripled its share price just simply by announcing it. Sure, the story is good and maybe one day this is going to be a real money maker for names like this, but today that jump is just simply on excitement and nothing else.

William: It's definitely uncharted territory for this kind of industry. It hasn't been legal in the foreseeable past, so it's sort of hard to predict, but Queensland Bauxite is quite a small company and it's hard to think that the management have any experience in this.

Shannon: That's the other thing.

William: Yeah, who knows, so tread with caution.

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