The Super Bowl has come around once again, at a time when tech stocks are trying their best to reignite after last year’s rough selloff. The timing may prompt investors to not only look to the Super Bowl’s crucial role for digital sports betting firms like DraftKings (DKNG) but also at the changing and growing world of digital consumers. As eyes turn towards the Super Bowl, market watchers may want to consider a digital consumer ETF like the ARK Next Generation Internet ETF (ARKW).
Sports betting has become increasingly legalized across the U.S. in recent years, a trend that could promise a record breaking $1.1 billion in total Super Bowl-related bets. That’s a significant opportunity for firms like DraftKings (DKNG) which could be poised to take advantage, with the nationally-recognized online betting hub weighted at 4.8% in ARKW. DKNG is up about 54% over the last month, meanwhile, as it looks to rebound from a tough 2022.
More broadly, online sports betting is just one piece of the ever-growing digital content landscape defined by short-form video and recommendation engines supplanting incumbent media and AI streamlining work and getting more eyes on digital entertainment. According to ARK Invest’s Big Ideas for 2023, online sports betting in the US and Canada is likely to grow 27% in real terms at an annual rate during the next five years, from ~$100 billion in 2022 to ~$330 billion in 2027.
Each of those factors in a growing market for online leisure presents an intriguing case for a digital consumer ETF like ARKW. The strategy is actively managed, investing in companies that are poised to profit from advances in cloud computing, e-commerce, big data, artificial intelligence, mobile technology, social platforms, and financial technology.
Charging 88 basis points, the ETF has returned 44.6% over the last month, outperforming its ETF Database Category Average and its Factset Segment Average with returns of 11.1% and 23% respectively. ARKW has also added $9 million in net inflows over the last month.
The world is consuming more content online than ever, and with the biggest event in the U.S. media market coming up this month, investors may want to watch a digital consumer ETF, too. ARKW represents a notable option for exposure to the space in the weeks and months ahead.
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