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Video Gaming ETFs to Gain on Surging Sales Amid Pandemic
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The coronavirus outbreak has provided a push to the video gaming industry. The pandemic confined people indoors to minimize human-to-human contact and follow the social distancing norms. This, in turn, increased demand for in-house sources of entertainment, driving video games sales. Even though the outbreak is slowly coming under control with the coronavirus vaccine rollouts, demand within the industry is expected to remain strong.
Notably, consumer spending on video games in the pandemic-stricken 2020 touched a new record of $56.9 billion, rising 27% from the 2019 reading, per The NPD Group. Markedly, the latest report from the industry-tracking firm highlights the same story.
Video Game Sales Continue Surging
Recently-released data from The NPD Group reflects that the video game industry including packaged media, digital, consoles and accessories saw strong sales in the first quarter of 2021 with people spending $14.92 billion in total. Notably, the figure surged 30% year over year.
Markedly, there was about 81% and 42% rise in hardware and accessories spending, respectively, during the first quarter. Moreover, content spending rose 25% to $12.8 billion.
In this regard, The NPD Group’s Mat Piscatella, industry analyst, U.S. Games, said that “Consumer spending on video game products continued to thrive in the first quarter, delivering record results.”
Moving on, Mat Piscatella also mentioned that “While we are still seeing elevated rates of both engagement and spending resulting from changes in consumer behavior driven by the pandemic, we are also seeing cyclical gains from the November launches of both the PlayStation 5 and Xbox Series consoles. The growth driven by these new platforms, combined with gains experienced in mobile, PC and VR content spending, as well as the continued strength of Nintendo Switch, have pushed the market to new highs.”
Notably, Among Us, Animal Crossing: New Horizons, Call of Duty: Black Ops Cold War, Candy Crush Saga, Fortnite, Grand Theft Auto V, Mario Kart 8, Minecraft, Super Mario 3D All-Stars and Super Mario 3D World were among the best-selling and most played games in the first quarter.
Video Gaming ETFs to Shine Bright
It seems that the boom in the video gaming space may remain even in the post-pandemic era as the outbreak changed the lifestyles and preferences of US citizens to a large extent. Against this backdrop, investors can take a look at the following video gaming ETFs:
The Roundhill BITKRAFT Esports & Digital Entertainment ETF (NERD - Free Report)
The fund is designed to offer investors exposure to esports & digital entertainment by providing investment results that closely correspond, before fees and expenses to the performance of the Roundhill BITKRAFT Esports Index. It holds 35 stocks in its basket. With AUM of $103.8 million, the fund charges 50 basis points (bps) in expense ratio (read: Sports Betting ETFs to Rally on March Madness Gambling).
VanEck Vectors Video Gaming and eSports ETF (ESPO - Free Report)
The fund seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the MVIS Global Video Gaming and eSports Index, which is intended to track the overall performance of companies involved in video game development, esports and the related hardware and software. It holds 26 stocks in its basket. With AUM of $798.4 million, the fund charges 55 bps in expense ratio (read: Activision ETFs Set to Shine Bright on Strong Q1 Results).
The fund seeks to invest in companies that develop or publish video games, facilitate the streaming and distribution of video gaming or esports content, own and operate within competitive esports leagues or produce hardware used in video games and esports including augmented and virtual reality. It holds 39 stocks in its basket. With AUM of $674.7 million, the fund charges 50 bps in expense ratio (read: Grab These 5 ETFs as Coronavirus Cases Continue to Rise).
The fund provides pure-play and diversified exposure to a dynamic intersection of technology and entertainment. It also corresponds generally to the price and yield performance of the EEFund Video Game Tech Index. The index is designed to reflect the performance of companies involved in the video game technology industry including game developers, console and chip manufacturers, and game retailers. It holds 105 stocks in its basket. With AUM of $114.1 million, the fund charges 75 bps in expense ratio.
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Video Gaming ETFs to Gain on Surging Sales Amid Pandemic
The coronavirus outbreak has provided a push to the video gaming industry. The pandemic confined people indoors to minimize human-to-human contact and follow the social distancing norms. This, in turn, increased demand for in-house sources of entertainment, driving video games sales. Even though the outbreak is slowly coming under control with the coronavirus vaccine rollouts, demand within the industry is expected to remain strong.
Notably, consumer spending on video games in the pandemic-stricken 2020 touched a new record of $56.9 billion, rising 27% from the 2019 reading, per The NPD Group. Markedly, the latest report from the industry-tracking firm highlights the same story.
Video Game Sales Continue Surging
Recently-released data from The NPD Group reflects that the video game industry including packaged media, digital, consoles and accessories saw strong sales in the first quarter of 2021 with people spending $14.92 billion in total. Notably, the figure surged 30% year over year.
Markedly, there was about 81% and 42% rise in hardware and accessories spending, respectively, during the first quarter. Moreover, content spending rose 25% to $12.8 billion.
In this regard, The NPD Group’s Mat Piscatella, industry analyst, U.S. Games, said that “Consumer spending on video game products continued to thrive in the first quarter, delivering record results.”
Moving on, Mat Piscatella also mentioned that “While we are still seeing elevated rates of both engagement and spending resulting from changes in consumer behavior driven by the pandemic, we are also seeing cyclical gains from the November launches of both the PlayStation 5 and Xbox Series consoles. The growth driven by these new platforms, combined with gains experienced in mobile, PC and VR content spending, as well as the continued strength of Nintendo Switch, have pushed the market to new highs.”
Notably, Among Us, Animal Crossing: New Horizons, Call of Duty: Black Ops Cold War, Candy Crush Saga, Fortnite, Grand Theft Auto V, Mario Kart 8, Minecraft, Super Mario 3D All-Stars and Super Mario 3D World were among the best-selling and most played games in the first quarter.
Video Gaming ETFs to Shine Bright
It seems that the boom in the video gaming space may remain even in the post-pandemic era as the outbreak changed the lifestyles and preferences of US citizens to a large extent. Against this backdrop, investors can take a look at the following video gaming ETFs:
The Roundhill BITKRAFT Esports & Digital Entertainment ETF (NERD - Free Report)
The fund is designed to offer investors exposure to esports & digital entertainment by providing investment results that closely correspond, before fees and expenses to the performance of the Roundhill BITKRAFT Esports Index. It holds 35 stocks in its basket. With AUM of $103.8 million, the fund charges 50 basis points (bps) in expense ratio (read: Sports Betting ETFs to Rally on March Madness Gambling).
VanEck Vectors Video Gaming and eSports ETF (ESPO - Free Report)
The fund seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the MVIS Global Video Gaming and eSports Index, which is intended to track the overall performance of companies involved in video game development, esports and the related hardware and software. It holds 26 stocks in its basket. With AUM of $798.4 million, the fund charges 55 bps in expense ratio (read: Activision ETFs Set to Shine Bright on Strong Q1 Results).
Global X Video Games & Esports ETF (HERO - Free Report)
The fund seeks to invest in companies that develop or publish video games, facilitate the streaming and distribution of video gaming or esports content, own and operate within competitive esports leagues or produce hardware used in video games and esports including augmented and virtual reality. It holds 39 stocks in its basket. With AUM of $674.7 million, the fund charges 50 bps in expense ratio (read: Grab These 5 ETFs as Coronavirus Cases Continue to Rise).
Wedbush ETFMG Video Game Tech ETF (GAMR - Free Report)
The fund provides pure-play and diversified exposure to a dynamic intersection of technology and entertainment. It also corresponds generally to the price and yield performance of the EEFund Video Game Tech Index. The index is designed to reflect the performance of companies involved in the video game technology industry including game developers, console and chip manufacturers, and game retailers. It holds 105 stocks in its basket. With AUM of $114.1 million, the fund charges 75 bps in expense ratio.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>