Video game stocks and ETFs are benefiting in significant fashion from stay-at-home orders and the Roundhill BITKRAFT Esports & Digital Entertainment ETF (NYSEArca: NERD) is among that group. NERD is up 38% in the current quarter and is recently spotted making a series of all-time highs.
NERD seeks to track the total return performance of the Roundhill BITKRAFT Esports Index, which tracks the performance of the common stock of exchange-listed companies across the globe that earn revenue from electronic sports, or esports related business activities. Data continue confirming the robust growth expectations associated with esports.
Data confirm that shelter-in-place directives spurred gamers to get the game on.
“According to our survey results, a third of Americans have increased their time playing video games since quarantining,” notes Satellite Internet. “But with more people online, you may need faster internet to keep up with the competition: 39% of online gamers have experienced increased buffering during the quarantine.”
The NERD Is Cool
NERD’s underlying index consists of a modified equal-weighted portfolio of globally-listed companies who are actively involved in the competitive video gaming industry. This classification includes, but is not limited to video game publishers, streaming network operators, video game tournament and league operators/owners, competitive team owners, and hardware developers.
Other data points confirm that gamers display similar habits to consumers of other forms of entertainment, a trend that’s been on display during the coronavirus and one that cements the long-term thesis for NERD.
“Thirty percent of socially isolating gamers play video games for two to three hours a day. And nearly 23% of all our gaming survey respondents played four hours or more every day,” notes Satellite Internet.
As ETF Trends reported last week, Will Hershey, chief executive of Roundhill Investments, also noted that the video gaming business was already doing well before the coronavirus outbreak, and it received a significant boost from “live, traditional sports being put on hold” as more look consider E-sports as another form of entertainment with stadiums locked down.
“One catalyst investors can look to later this year is the hardware upgrade cycle, meaning the debuts of the PlayStation 5 and the new Xbox in advance of the holiday shopping season,” according to Nasdaq.
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The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.