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Investing in eSports - entertaining and lucrative

The online gaming industry is an appealing investment niche to diversify your portfolio. Not only is gaming entering a new golden age in line with technological advancements like 5G and VR, but it is also one of the very few industries sheltered or readily adaptable to worldwide events, including lockdowns and social restrictions. Investors are flocking to gaming companies in the last few years and months, and eSports in particular, is gaining traction.

Esports tournament

The Bridge Desk

Updated: 3 Aug 2021 10:23 AM GMT

What is eSports?

eSports is a new genre of online video gaming where individuals and teams play against each other on a big stage, either streamed online or in purpose-built stadiums with fans. It is just like any other athletic sport with a growing fanbase of avid gamers. Those who do make it to the top and play for the best teams can earn excessive amounts of money, and it has already made millionaire teenagers.

And just how you can buy shares in the world's biggest sports companies, you can now buy shares in eSports teams and businesses. They're a fantastic way to diversify your portfolio.

How fast is this growing?

Business Insider recently reported that eSports consumers are estimated to almost double over a six-year period from 2017 to 2023. There were approximately 335 million regular fans in 2017, which should stand around 646 million as of 2023. Most viewers come from Asia, with Scandinavia reported having the most extensive viewership in Europe. However, numbers are increasing across borders rapidly. You can read about the top 10 countries tweeting about eSports.

Accessibility has played a vital role in placing this activity in the mainstream. Platforms like Twitch and YouTube are proving essential for the teams, players, and competitions to get noticed. These figures are represented in investment growth across the industry too. In 2017, around $490 million dollars had been invested. Yet, just one year later, that figure rose to a staggering $4.5 billion.

How will eSports companies make money?

Businesses in this specific industry can make money in different ways depending on their purpose. The teams themselves can earn money by performing well, whereas event organisers will make money through sponsorship deals, ticketing, streaming and broadcasting just like other sports do. Even big data companies can make money by selling statistics about opponents, a bit like a data analyst who works for a professional sports club.

What are the best stocks?

If you want to invest in eSports stocks, here are some of the best options at the time of writing:

1. Activision Blizzard – a big name that also creates leagues and partners with broadcasters.

2. Huya – A Chinese video game streaming company that is expected to latch onto the eSports buzz.

3. Electronic Arts – a name that every gamer will recognize. They have a lot of potential to crossover from their video game creation work into the eSports world.

These are just three potential growth stocks. Always conduct your own research.

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