How to Invest in eSports

How to Invest in eSports

Invest in eSports

A desire to invest in eSports has been growing across the nation for awhile now. With many people stuck at home due to COVID-19 restrictions, that interest has boomed. After all, more and more people are home playing video games. Simultaneously, more people are seeking innovative ways to make money from home. It’s a perfect combustion – and perhaps the perfect time to learn how to invest in eSports.

What is eSports?

Competitive gaming is also called eSports. In other words, people compete at video games. This is a 21st century sporting event. If you haven’t gotten into it yourself, then you might not see the appeal. However, eSports is a growing industry that has really started to boom in the past few years. It’s predicted that the eSports will top $1 billion in 2020 for the first time, a prediction that was made even before COVID-19 caused a surge in online gaming viewership.

eSports and COVID-19

While regular sporting events are suffering during the COVID-19 pandemic, eSports are soaring. These competitive video game tournaments can be done and viewed entirely alone from home. Therefore, they are the perfect form of entertainment in the era of coronavirus.

Twitch is one of the most popular platforms for eSports competitions. It’s a platform that has gained a lot of attention in the past few months. Personally, I’ve seen quite a few performance artists suddenly take to Twitch to share their work. due to COVID-19, more people are discovering this platform. As an extension, more people are discovering eSports.

By the way, Twitch is owned by Amazon. Therefore, as Investing News points out, the you invest in Amazon, you technically invest in eSports. While this isn’t a direct way to invest in eSports, it can certainly be a start for people who are a bit risk averse. If you’re just dipping your toe into this industry, that’s where you can start.

How to Invest in eSports Companies

If you want to invest in eSports, then there are a few big names that you need to know. Many people know the names of the most popular games in eSports. For example, perhaps you have heard of Call of Duty. However, fewer people know the names of the companies behind each game. To invest in eSports, you need to invest in the stocks of the company producing the games. Therefore, you need to learn those names.

Top Companies to Invest in eSports

If you are specifically interested in certain games and the companies that produce those games then you might want to invest directly in their stocks. For example, let’s say that you do love Call of Duty. You might enjoy watching players compete at an elite level. Having some money on the game, in the form of investments rather than betting, could make it even more fun for you. Therefore, you might invest in Activision Blizzard (ATVI), which is the company that makes the game.

Top Gaming Companies in eSports

Here are the top gaming companies that you might be interested in if you want to invest in eSports:

  • Activision Blizzard (ATVI) not only makes Call of Duty but is also the company behind World of Warcraft, Overwatch, and several other popular games.
  • Electronic Arts (EA) is particularly known for sports games like Madden and FIFA.
  • Take-Two Interactive (TTWO) is best known for the NBA 2K games as well as Grand Theft Auto.
  • Tencent Holdings (TCEH.Y) is known for Fortnite, League of Legends, and Honor of Kings.

Other Top Companies in eSports

If you think that eSports is a growing trend, and you want to invest, but you don’t necessarily care about gaming itself, then you might want to think about the bigger picture. In order for gaming to work, certain things are needed. For example, NVIDIA is known for making the best computer chips for gaming. As more and more people are gaming at competitive levels, NVIDIA’s stock value rises. Therefore, you might want to invest in their stocks. NetEase and Logitech are two other popular companies for such investments.

You can even invest in companies that advertise during eSports games. For example, Ameritrade’s The Ticker Tape mentions that Intel and Coca-Cola are two companies in this arena.

Invest in eSports Through ETFs

If you don’t want to invest directly in the companies but instead want to invest more generally in eSports, then you’ll want to look into ETFs. ETFs specifically related to eSports are a new, but growing, area. The Shadow League names the following ETFs to look into further:

  • ESPO ETF
  • GAMR ETF
  • HERO ETF
  • NERD ETF by Roundhill Investments
  • VIDG ETF

The Shadow League points out that ETFs like this allow investors “to tap into the potential of esports and invest not just in the genre, but in the players that have a stake in the entire industry.” In other words, you’re not just investing in a specific game or tournament but rather the entire industry including hardware, product sponsorships, and other tangential aspects that go into the larger arena of eSports.

Should I Invest in eSports?

Now that you know how to invest in eSports, you might ask yourself if it’s the right thing for you to do. If you absolutely love video games and this is something that you can get passionate about then it could definitely be fun for you. However, if you’re looking at it purely from a financial perspective, you need to think about it all very carefully.

The most important thing to realize is that this is a young and growing market. Therefore, there is a lot of potential to make significant money in the years to come. You can get in on the ground floor now. Learn how to invest in eSports. Get savvy at it. Then you might see a windfall.

That said, it’s also a risky market. We don’t know where it’s going. It’s a young market. The players in it could change rapidly. Therefore, if you are risk averse when it comes to investing then you might not want to go this route right now.