Summary
META invests in the Metaverse, the planned virtual reality replacement to the internet.
The fund’s holdings include gaming platforms, cloud service providers, and hardware producers.
META is a classic high-risk high-reward investment opportunity, and appropriate for aggressive growth investors.
An overview of the fund follows.
This idea was discussed in more depth with members of my private investing community, CEF/ETF Income Laboratory. Learn More »
RB Stocker/iStock via Getty Images A couple months ago, Mark Zuckerberg announced that Facebook ( FB ) was changing its name to Meta, as part of a corporate pivot towards the metaverse : online environments, including virtual and augmented realities, were individuals can engage in a myriad activities. Meta is going all-in on the metaverse, with a suite of products and services including virtual reality workspaces, augmented reality glasses, and virtual reality games. Meta Corporate Website Meta’s pivot is part of a larger tech shift towards the metaverse, and attendant products and services. Microsoft ( MSFT ) is investing quite heavily in video games, so are newcomers Epic Games and Roblox, as are Chinese companies like Tencent ( OTCPK:TCEHY ). Crypto startups are creating a vibrant economic ecosystem of virtual goods on the blockchain, including artwork (NFTs), finance (DeFi), and gaming (Axie Infinity). The metaverse is booming, and although there is no guarantee that it will permanently displace the current internet, it seems quite likely.
Investing in the metaverse seems like a reasonably good idea, which is where the Roundhill Ball Metaverse ETF ( META ) comes in. META is exactly what it says on the tin: a metaverse ETF, investing in companies focused on the development and support of virtual / augmented reality products and services. The fund’s holdings include video game developers, software developers, and computer hardware manufacturers.
META’s potential returns are quite high, as the fund’s holdings are growing quite rapidly, and will likely see continued growth as the metaverse is further developed.
META’s risk, volatility, and potential losses are quite high as well, as the fund focuses on companies with sky-high valuations. Worsening economic conditions or market sentiment should cause valuations to tumble, ultimately resulting in significant losses and underperformance.
META is a classic high-risk high-reward investment opportunity, and appropriate for aggressive growth investors looking for exposure to the Metaverse. META – Overview
META is an ETF focusing on the metaverse. It is technically an index ETF, tracking the Ball metaverse Index . In practice, the fund’s underlying index is a bespoke index, whose strategy, holdings, and weights are strongly dependent, and at the discretion of, the fund’s investment management team. As such, I consider META to be closer to an actively-managed fund than to an index fund, for all intents and purposes.
META focuses on the metaverse which, according to the fund’s management team, is the successor to the current internet. The metaverse will encompass countless virtual worlds, accessed through either virtual reality headsets, or augmented reality electronics (smart glasses, smart phones, etc.). People will be able to socialize, play, work, and engage in myriad activities in the metaverse. It will have its own economy, centered on the creation and commercialization of virtual goods.
The metaverse is still under development, and although there is no guarantee that it will ever be technology or commercially successful, there are some, let’s say, prototypes available. Meta (Facebook), has already built software allowing workers to have meetings in virtual reality spaces, with the use of virtual reality headsets. Meta Corporate Website Zuckerberg seems quite optimistic about the technology, and it does seem potentially revolutionary considering the increased prevalence of working from home. Time will tell if the product is successful.
There are many virtual reality games available, including Beatsaber, Half-Life Alyx, and Blade and Sorcery. Players use virtual reality headsets and motion capture sensors to interact with virtual environments, objects, and even other players. Virtual reality games are fully interactive, immersive, although graphics are still somewhat rudimentary, and latency is a constant issue. Steam Most famous of all is the most commercially successful augmented reality game in history, Pokémon Go. The game allowed players to catch Pokémon, fantasy animal collectibles, in real-world locations through their cellphones. It was incredibly popular, the most popular app in history at a point, and quite fun too, in my opinion at least. Pokemon Go The metaverse will have a rich economy, based on the creation and commercialization of digital goods. We already have NFTs, basically digital artwork, example below, and lots of games sell other types of digital goods too. The […]
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