newsinsights

Browse our recent blogs, articles and papers below and sign up here for our regular newsletter. 

Introducing Europe's First Sports Betting ETF

Learn more about our Sports Betting ETF 

 

Index Composition

The index our Sports Betting ETF tracks is rules-based, providing exposure to global companies that generate the majority of their revenues and/or growth in revenues to Sports Betting and iGaming.

The companies include B2C online-focused brands that have exposure to a wide range of online gaming products; omnichannel companies that have bricks and mortar casinos with an increasing emphasis to online; and service provides to B2C companies that include technology platform, sports data providers, media and affiliate marketing companies.

The index is diversified across company type, size and regional exposure. It includes larger and more established companies alongside a number of small to medium size companies that specialise in one aspect of the value chain that can grow inline, or at a faster pace than the industry.

Around two thirds of the companies in the Index are B2C companies with the remaining one third made up of technology, data and other product suppliers and media /affiliate marketing companies.

 

Around 60% of the companies are listed in Europe with the remainder in the US, with one Australian companies. The largest market cap companies are in the US.

 

Key success drivers for the B2C companies:

Wide geographic reach

Width & depth of product offering

Leading product and technology integration

Efficient player acquisitions and retention

Wide geographic reach and ability to scale across regions. There is a current rush to secure new state licenses to a) capture additional revenues and b) leverage national marketing spend. Sports betting market access is achievable given larger number of casinos in most states.

Wide product offering and ability to capture the greatest share of wallet. Products include sports betting, iGaming, DFS, bingo, poker, horse racing, Live dealer. iGaming is particularly important addition to sports betting and DFS given better economics.

Leading product and technology integration. inhouse technology preferred to increase efficiency, flexibility and costs.

Efficient player acquisitions and retention. Leveraging existing player database from bricks and mortar, Daily Fantasy Sports, media lowers average customer acquisitions costs. For example, MGM has a 5.4x Marketing ROI on existing MGM customers. Leading loyalty programs. Media and content relationships such as strategic partnerships with leagues, teams and media are also important to develop content and attract/retain customers.

 

Around one third of the companies in our Index are so called “Picks and Shovel” companies that generally provide a service to the consumer branded companies in the industry.

These include technology companies that provide the player account management (PAM) platform or other technology services. Some technology companies charge based on a percentage of revenue; enjoy high margins and are highly valued by investors.

One of the companies in the index provides sports betting data and other has a “live dealer” product that seamlessly integrated into their customer platform.

Media that is tailored to sports betting content is on the rise. One the larger casinos companies in our index has taken a meaningful stake in a leading media company that appeals to the sports betting demographic, which lowers the company’s customer acquisitions costs.

There is a growing importance of online sports betting to media/leagues with betting driving:

  • Higher audience engagement
  • Higher ratings
  • Rising ad dollars and spend
  • Increasing values for media rights
  • Rising franchise, team and league values.

 

Affiliate are companies provide gaming content that then direct customers to a consumer website or application.

 

Associated Risks

  • The value of equities and equity-related securities can be affected by daily stock and currency market movements
  • Investors' capital is fully at risk and investors may not get back the amount originally invested
  • Exchange rate fluctuations could have a negative or positive effect on returns
  • Please note this is not an exhaustive list of risks. Other risks may apply.

 

Fischer Sports Betting and iGaming UCITS ETF

The Fischer Sports Betting & iGaming UCITS ETF ‘BETS’ seeks to offer exposure to the rapidly growing global sports betting and iGaming industry.

The BETS ETF tracks the Solactive Fischer Sports Betting and iGaming Index which is focused on companies that derive significant revenue from Sports Betting and iGaming (online activities that include poker and online casinos games such as blackjack, slots and fantasy sports). Companies include B2C online-focused brands that have exposure to a wide range of online gaming products; omnichannel companies with bricks and mortar casinos with an increasing emphasis on online business; and service providers such as technology platform, sports data providers, media and affiliate marketing companies.

Europe’s first Sports Betting and iGaming ETF

This will be Europe’s first Sports Betting and iGaming ETF, and European investors’ first opportunity to access the rapidly growing global sports betting and online industry via an ETF.

An expanding market due to regulatory changes

Goldman Sachs* expects the US sports betting and iGaming market to expand 23x from $2b in 2020 to $53b in 2033. Globally, the industry is expected to grow by 11% pa over the next fiveyears, according to H2 Capital**. Regulatory changes allowing US states to legalise sports betting and iGaming, in various forms, has been the major growth catalyst whilst Europe and Asia are also high growth markets. *Goldman Sachs Equity Research - 22/03/21; **H2 Global All Product Summary - 06/04/21

Growth drivers of the industry

Besides the regulatory environment, growth drivers of the sports betting market include a wider social acceptance of sports betting as an entertainment activity; sports betting support from sports leagues, teams and media companies; technological improvements that allow an enhanced online experience; and more generally, greater time spent on mobile devices.

Risks of investing

As with all investments you should be fully aware of the risks of trading ETFs:

  • Thematic ETFs are exposed to a limited number of sectors and thus the investment will be concentrated and may experience high volatility
  • When you trade ETFs, your capital is fully at risk
  • Past performance is no guarantee of future performance
  • Exchange rate fluctuations can have both positive and negative effects on returns
  • Further risks are disclosed in the KIID and prospectus

For a detailed list of risks, please consult the KIID and prospectus

 

Back-tested performance (29/05/20 – 10/05/21)

Index performance data is based on back tested index data Back testing is the process of evaluating an investment strategy by applying it to historical data to simulate what the performance of such strategy would have been. Back tested data does not represent actual performance and should not be interpreted as an indication of actual or future performance. Past performance for the index is in USD. Past performance is not an indicator for future results and should not be the sole factor of consideration when selecting a product. Investors should read the prospectus of the Issuer (“Prospectus”) before investing and should refer to the section of the Prospectus entitled ‘Risk Factors’ for further details of risks associated with an investment in this product. Source: Fischer Gaming/Bloomberg. Data as of 10.05.2021.

 

To learn more about our Sports Betting ETF, visit our fund page here

Tell us how we can help