VanEck is today celebrating the one-year anniversary of the launch of the VanEck Vectors® Video Gaming and eSports ETF (NYSE Arca: ESPO®).
“Packed stadiums, millions of dollars in merchandise, sponsorship and TV deals—we’re not talking about the NFL or Major League Baseball. Instead, we’re talking about esports,” said Ed Lopez, Head of ETF Product at VanEck. “This completely new form of entertainment and the video game industry it has grown out of are upending traditional sports and entertainment and seeing rapid growth, driven by a young, affluent audience.”
Esports revenue growth has increased almost 40% annually since 20151 with recent estimates showing the global esports market surpassing $1 billion in revenues for calendar year 2019.2 Much of that is driven by the increasing sponsorship dollars flowing to esports organizations as the global competitive gaming audience continues to rise, expected to reach 454 million for 2019.3
In the midst of this growth, ESPO was launched to provide a single point of access for investors looking to add exposure to the global esports and video game industry.
ESPO seeks to track, before fees and expenses, the performance of the MVIS® Global Video Gaming and eSports Index (MVESPO). The index is a rules-based, modified capitalization weighted, float adjusted index intended to give investors a means of tracking the overall performance of companies involved in video gaming and esports. To be eligible for inclusion in the index, companies must generate at least 50% of their revenues from video gaming and/or esports.
“Fortnite skins have replaced baseball cards, Twitch streams have replaced the Game of the Week, and the momentum driving further growth in video games and esports appears to be a long-term trend that’s still in its nascent stages. We’re very pleased to be marking ESPO’s first anniversary and look forward to all that this fast-growing industry has to offer investors in the years to come,” added Lopez.
VanEck has a history of looking beyond the financial markets to identify trends that are likely to create impactful investment opportunities. We were one of the first U.S. asset managers to offer investors access to international markets. This set the tone for the firm’s drive to identify asset classes and trends – including gold investing in 1968, emerging markets in 1993, and exchange traded funds in 2006 – that subsequently shaped the investment management industry.
Today, VanEck offers active and passive strategies with compelling exposures supported by well-designed investment processes. As of September 30, 2019, VanEck managed approximately $49.5 billion in assets, including mutual funds, ETFs and institutional accounts. The firm’s capabilities range from core investment opportunities to more specialized exposures to enhance portfolio diversification. Our actively managed strategies are fueled by in-depth, bottom-up research and security selection from portfolio managers with direct experience in the sectors and regions in which they invest. Investability, liquidity, diversity, and transparency are key to the experienced decision-making around market and index selection underlying VanEck’s passive strategies.
Since our founding in 1955, putting our clients’ interests first, in all market environments, has been at the heart of the firm’s mission.
Indexes are unmanaged and are not securities in which an investment can be made. Index returns do not reflect a deduction for fees & expenses.
MVIS Global Video Gaming and eSports Index is the exclusive property of MVIS (a wholly owned subsidiary of Van Eck Associates Corporation), which has contracted with Solactive AG to maintain and calculate the Index. Solactive AG uses its best efforts to ensure that the Index is calculated correctly. Irrespective of its obligations towards MV Index Solutions GmbH, Solactive AG has no obligation to point out errors in the Index to third parties. The VanEck Vectors Video Gaming and eSports ETF is not sponsored, endorsed, sold or promoted by MV Index Solutions GmbH and MV Index Solutions GmbH makes no representation regarding the advisability of investing in the Fund.
An investment in the VanEck Vectors® Video Gaming and eSports ETF may be subject to risks which include, among others, investing in the video gaming and eSports industry, information technology, equity securities, foreign securities, foreign currency, special risk considerations of investing in Asian, Japanese and emerging markets issuers, depositary receipts, small- and medium-capitalization companies, cash transactions, market, operational, index tracking, authorized participant concentration, absence of prior active market, trading issues, passive management, fund shares trading, premium/discount risk and liquidity of fund shares, non-diversified and concentration risks, all of which may adversely affect the Fund. Foreign investments are subject to risks, which include changes in economic and political conditions, foreign currency fluctuations, changes in foreign regulations and changes in currency exchange rates which may negatively impact the Fund's returns. Small and medium-capitalization companies may be subject to elevated risks. The Fund's assets may be concentrated in a particular sector and may be subject to more risk than investments in a diverse group of sectors.
The principal risks of investing in VanEck Vectors ETFs include sector, market, economic, political, foreign currency, world event, index tracking and non-diversification risks, as well as fluctuations in net asset value and the risks associated with investing in less developed capital markets. The Funds may loan their securities, which may subject them to additional credit and counterparty risk. Please see the prospectus of each Fund for more complete information regarding each Fund's specific risks.
Fund shares are not individually redeemable and will be issued and redeemed at their net asset value (NAV) only through certain authorized broker-dealers in large, specified blocks of shares called “creation units” and otherwise can be bought and sold only through exchange trading. Shares may trade at a premium or discount to their NAV in the secondary market. You will incur brokerage expenses when trading fund shares in the secondary market. Past performance is no guarantee of future results.
Investing involves substantial risk and high volatility, including possible loss of principal. An investor should consider the investment objective, risks, charges and expenses of the Fund carefully before investing. To obtain a prospectus and summary prospectus, which contains this and other information, call 800.826.2333 or visit vaneck.com. Please read the prospectus and summary prospectus carefully before investing.
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1 Newzoo, Global eSports Market Report, 2017, 2018, 2019
3 Newzoo, Global eSports Market Report, 2019
Mike MacMillan/Chris Sullivan