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Likely ETF Winners from the No-Spectator Tokyo Olympics

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The countdown to the delayed Tokyo 2020 Olympic games has begun and Japan is warming up to host the event from July 23. The International Olympic Committee says organizers have done their best to arrange safe no-spectator games as the coronavirus pandemic is in place.

One of Japan's most leading business leaders says that “economic losses from no-fan Tokyo Olympics will be 'enormous'”. So far, more than 60 Japanese businesses have shelled out a record high of $3 billion on this year's Olympics and the return of investments may be lower, per the source.

Still there are some silver linings in the whole story. Entertainment researcher Gracenote Inc. predicts the country could fetch a record 61 medals, about 50% more than five years ago in Rio, including 26 golds. That could benefit the likes of sponsors and supports including Mizuno Corp., the swimwear supplier for Japan’s swim team, per a Bloomberg article.

The Bloomberg article went on to highlight that the companies that sell the likes of fried-chickens, food-delivery operators and electronics stores selling TVs are likely to benefit from the event, per analysts. “Purchases of food and TVs will be expected to increase, as people seek to make the Olympics more fulfilling,” Naoya Kumagai, a strategist from Okasan Securities, wrote in a recent report, as quoted on Bloomberg.

Though it is not a regular Olympics, along with many other analysts we too expect stay-at-home stocks to gain from the event as people around the world will try to watch it from their homes. Against this backdrop, below we highlight a few ETFs that are worth investing in light of Tokyo Olympics.

ETFs to Win

Invesco NASDAQ Internet ETF (PNQI - Free Report)

Internet stocks and ETFs are the top picks in the stay-at-home investing category. The underlying NASDAQ Internet Index of the fund is a modified market-capitalization weighted index designed to track the performance of the largest & most liquid U.S.-listed companies engaged in internet-related businesses & that are listed on one of the three major U.S. stock exchanges. Interactive Media and Services account for about 23.3% of the fund.  The fund charges 60 bps in fees (read: ETF Strategies to Combat Aggravating Coronavirus Pandemic).

Global X social media ETF (SOCL - Free Report)

Who can forget social media stocks and ETF? After all, discussions over any hot topic spread like a wild fire. Social media stocks like Facebook (FB) and Twitter (TWTR) are likely to make good use of the event. This should benefit the fund SOCL, which is designed to reflect the performance of companies involved in the social media industry, including companies that provide social networking, file sharing, and other web-based media applications.

John Hancock Multifactor Media & Communications ETF (JHCS - Free Report)

The National Broadcasting Company or NBC, owned by Comcast Corp. (CMCSA - Free Report) , will broadcast the coverage of a lot of the big events — both live and on tape delay due to the 13-hour time difference in Tokyo. Comcast has more than 6% weight in the fund JHCS. Hence, the fund deserves a close watch.

AdvisorShares Restaurant ETF (EATZ - Free Report)

This ETF is active and does not track a benchmark. The fund gives exposure to restaurant stocks like Domino’s Pizza, Pizza Hut and Yum Brands. Demand for food delivery is likely to go higher during the event. Hence, the fund may emerge a beneficiary. The fund charges 79 bps in fees.

iShares MSCI Japan ETF (EWJ - Free Report)

Several Japanese sectors and stocks should be under watch for gains. The fund EWJ looks to track investment results that correspond generally to the price and yield performance of the MSCI Japan Index. Industrials, Consumer Discretionary, Information Technology and Health Care hold a double-digit weight in the fund.