New technologies, such as virtual and augmented reality, have enhanced gaming experiences and contributed to this recent growth. In addition, the video gaming world has seen the rise in a modern video gaming sport called eSports, where thousands of people gather across the world to watch professional video gamers battle it out.

“Fitch believes that the continued growth and awareness of eSports will benefit video game publishers through higher active user bases, increased sales of high-margin micro transactions and higher sustainability/longer revenue-generating lifespan of core franchises that are transitioned into eSports,” said Fitch. “The dollar potential of media rights will also be a long-term cash flow opportunity and potential credit positive, once user engagement is quantified on a more standardized level.”

GAMR follows the EEFund Video Game Tech Index, which tracks the performance of companies across the video gaming space. The ETF contains holdings from across the globe but with a focus on companies in the United States and in Asian countries.

“Longer-term, Fitch believes the growth and popularity of eSports as a discretionary activity could detract from the participation and/or viewership of select traditional sports, particularly those with less appeal to the millennial demographic,” according to Fitch.

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