8 June 2023: Wealth Product Ideas
| Fund Name (Ticker) | VanEck Video Gaming and eSports ETF (ESPO) |
| Description | VanEck Video Gaming and eSports ETF (ESPO®) seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the MVIS® Global Video Gaming and eSports Index (MVESPOTR), which is intended to track the overall performance of companies involved in video game development, esports, and related hardware and software. |
| Asset Class | Equity |
| 30-Day Average Volume (as of 30 May) | 38093 |
| Net Assets of Fund (as of 30 May) | US$284.03M |
| 12-Month Trailing Yield | 1.02% |
| P/E Ratio (as of 31 May) | 27.80 |
| P/B Ratio (as of 31 May) | 3.64 |
| Management Fees (Annual) | 0.50% |
Top 10 Holdings
(as of 5 June 2023)
- BUY Entry –27.5 Target – 30.0 Stop Loss – 26.3
- Release of Apple’s Vision Pro. Apple recently just announced during its WWDC conference 2023 the launch of a new AR product, Apple Vision Pro, due to be released in the United States in early 2024. The Vision Pro will allow users to see apps in a new way, in the spaces around them. Users can use their eyes and hands to navigate through apps and search with their voices. The headset can be used to watch movies, including in 3-D, with spatial audio, view their own pictures or videos, and play video games. It can also be used for work with video conferencing apps, Microsoft Office tools or Adobe Lightroom. The launch of Vision Pro would bound to drive growth for gaming-related industries in the near future.
- Rise of Generative AI. The surge in AI’s popularity in the market reflects the growing demand for AI technology. The emergence of generative AI is set to revolutionize the gaming industry, enabling games to offer a customized and seamless experience. This, in turn, will greatly amplify the demand within the gaming sector. Furthermore, the imminent release of augmented reality (AR) devices in the near future will further elevate the industry.
- Increasing popularity of esports. Over the past few years, the esports industry has experienced remarkable growth in terms of its audience and financial performance. It has witnessed a rapid expansion, almost reaching the $1 billion mark, fueled by significant technological advancements and a dedicated global fan base. The outbreak of the COVID-19 pandemic played a significant role in accelerating this growth, as individuals sought out video gaming as a means to combat boredom and maintain social connections while adhering to stay-at-home measures. The ongoing revolution in esports is poised to sustain the demand for gaming-related products in the foreseeable future.
(Source: Bloomberg)
| Fund Name (Ticker) | Global X Cloud Computing ETF (CLOU US) |
| Description | The Global X Cloud Computing ETF seeks to invest in companies positioned to benefit from the increased adoption of cloud computing technology, including companies whose principal business is in offering computing Software-as-a-Service (SaaS), Platform-as-a-Service (PaaS), Infrastructure-as-a-Service (IaaS), managed server storage space and data center real estate investment trusts, and/or cloud and edge computing infrastructure and hardware. |
| Asset Class | Equity |
| 30-Day Average Volume (as of 6 June) | 229,559 |
| Net Assets of Fund (as of 6 June) | USD$585,090,000 |
| 12-Month Trailing Yield | NA |
| P/E Ratio (as of 5 June) | 34.66 |
| P/B Ratio (as of 5 June) | 4.00 |
| Management Fees | 0.68% |
Top 10 Holdings
(as of 6 June 2023)
- BUY Entry – 19.2 Target – 22.0 Stop Loss – 17.8
- Demand for cloud on the rise. The demand for cloud computing services experienced a significant surge during the pandemic as work, school, and social activities transitioned to digital platforms. This growth was driven by remote work and learning, the expansion of the Internet of Things (IoT), and the increasing prominence of artificial intelligence (AI). Remote work and learning required cloud-based applications for productivity and connectivity, while the IoT relied on cloud computing to manage the vast amount of data generated by connected devices. Additionally, AI’s rapid development necessitated the computing power and data storage capabilities of the cloud. As these trends continue to evolve, the demand for cloud computing services is expected to persist and expand, meeting the ongoing need for digital experiences in work and learning.
- Technological breakthroughs, leading to increased reliance on cloud. The emergence of generative AI, Web3, and the metaverse has expanded the role of cloud computing, due to its ability to store and process large amounts of data. Generative AI models rely on the cloud to store and process the extensive training data they require. Web3 applications, known for their decentralised nature, benefit from the scalability and reliability offered by cloud hosting. Additionally, the metaverse, a virtual world that is constantly evolving, relies on the cloud’s computing power to sustain its growth.
- Cloud’s flexible capacity alongside global digitalisation. Hyperscale cloud providers are driving the cloud agenda, offering advanced capabilities and infrastructure to support digital transformation, with a focus on technologies like generative AI. For example, Microsoft’s partnership with CoreWeave ensures sufficient computing power for OpenAI, currently relying on Microsoft’s Azure cloud infrastructure. As more companies adopt generative AI, the demand for GPU power on cloud infrastructure is increasing, highlighting the critical role of cloud platforms in providing scalable computing resources.
(Source: Bloomberg)
