Gaming ETF Cashes In with 30% Gain

ETF Trends

It is hard to ignore the strong year to date performance that a niche oriented ETF that targets the Gaming industry although BJK (Market Vectors Gaming, Expense Ratio 0.65%) still remains rather small at $56 million.

BJK is up more than 30% year to date.

In the general category of “Consumer Discretionary Equity”, this ETF invests in companies that derive more than 50% of their total revenues from the global gaming industry.

The fund composition is heavily slanted towards international companies, making up 71.14% of the portfolio with the remaining exposure coming from U.S. listed names.

Top holdings at the moment are Sands China Ltd. (8.28%), LVS (8.12%), Galaxy Entertainment Group Ltd. (7.78%), WYNN (7.17%), and Genting Bhd (4.56%).

As one might notice, three of these top five holdings are ordinary shares listed overseas, while LVS and WYNN are rather well-known and popular U.S. listed names.

For those whom want to see what is driving Gaming sector performance, one can quickly pull up a chart of LVS or WYNN and the strong run throughout the summer seems to correspond with a notable uptick in gambling revenue in Macau through August.

BJK holds forty eight individual equity names, with the top portion of the portfolio making up the lion’s share of the overall index (53.73% of the assets are held across the top ten holdings) yet the fund remains somewhat under-covered, trading only about 10,000 shares on an average daily basis.

BJK at the moment is the only game in town, no pun intended, that focuses on the Gaming industry, so it would not be surprising to see this ETF capture assets in slugs quickly, especially as more portfolio managers begin to track it thanks to a five year plus live track record now (debuted in 1/2008).

Being niche oriented and potentially volatile, the product is likely best suited for those whom know the Gaming industry and landscape precisely from a fundamental/valuation basis as opposed to broad asset class allocators.

Market Vectors Gaming

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gaming-etf

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