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Sports betting stocks and mutual funds: 5 methods to invest

When it comes to sports betting, one of the easiest ways to earn money is to invest in the house itself.

The popularity of sports betting is constantly increasing. According to the American Gaming Association, more than half of the states in the United States have authorized it, and six more were actively working on legislation to legalize it as of January 2022. As a result, according to Gabelli Securities, sales in the business are predicted to expand fivefold over the next several years, from $2.1b to $10.1b in 2028.

If last year’s Super Bowl is any indication, February 13’s game might break gambling records. The AGA predicted that 23 million Americans would wager $4.3 billion on the 2021 game, and since then, additional states have made it legal. Guaranteed loans for bad credit can see at Oak Park Financial.

Investing in the burgeoning sports betting business may be as easy as following these five simple steps.

1. Apps for sportsbooks

If you’re interested in sports betting, the first place you should look is at the firms that provide the applications that allow people to make their wagers. This is your best chance if you want to get a taste of this rapidly expanding sector. Here are a few of the best:

A 2021 arrangement with the NFL (together with Caesars and FanDuel) allows DraftKings (DKNG) to utilize NFL intellectual property and trademarks for betting promotions, making it one of the biggest sports-betting businesses in the world. The corporation is reportedly trying to acquire Entain, a competitor in the sports betting industry, as part of an ambitious expansion plan.

Fans of FanDuel’s fantasy sports site and sportsbook are certainly familiar with Flutter (PDYPY), the company’s stock symbol. According to the firm, FanDuel has a 42 percent share of the online sports betting industry in the United States. Other well-known online gambling brands owned by Flutter include PokerStars and Betfair.

In the public market, Rush Street Interactive (RSI) is a smaller, newer business that specializes in online gaming and sports betting.

You may come across other sports bettors, but they may also be involved in more lucrative ventures.

The Walt Disney Company, for example, has looked into sports betting to see whether it might use its own ESPN brand to its advantage. But if the corporation elected to go that path, sports betting would be only one aspect of a much bigger and more diverse organization. ” A Yahoo-branded sportsbook hosted by BetMGM is also available via the privately held media corporation, which takes use of Yahoo’s presence in fantasy sports. The “bang for your buck” you’d receive from these firms is likely to be lower than what you’d get from betting “pure play.”

2nd-party gaming firms

Investing in bigger gaming enterprises, more often referred to as casinos, is another option to take advantage of the increasing popularity of sports betting. There are several casinos that have sportsbooks and online sportsbooks, but you’d also be investing in the gaming and hotel businesses, so you wouldn’t have a lot of targeted exposure to sports betting. Here are some of the best players in the business:

There are hundreds of properties operated by Caesars Entertainment (CZR), including the Caesars Palace on the Las Vegas Strip. In 2021, it purchased William Hill, a UK-based bookmaker, but swiftly abandoned its global businesses to concentrate on US sports.

Even though it is well-known for its non-Vegas locations in smaller towns around the U.S., Penn National Gaming (PENN) has made a significant push into the online sports betting industry. With the purchase of Barstool Sports and the acquisition of Score Media and theScore Bet app, it is swiftly building a name for itself in sports betting.

MGM Resorts International (MGM): This firm owns and runs the MGM Grand, the Mirage, and several other casinos in Las Vegas. Through its BetMGM website, it also provides access to online gambling and sports betting.

The Marina Bay Sands and the Venetian Macao are only two of the world’s most popular casinos managed by Las Vegas Sands (LVS). While online and sports gambling have taken a while to catch on, the market is now beginning to move into the sector.

ETFs that track the performance of the gaming industry

There are several gaming ETFs to choose from, including those that cover sports betting, internet gambling, and conventional brick-and-mortar establishments. You may play the reopening trade as more people travel and visit casinos using an ETF and receive wide exposure to the industry without picking a winner. Listed below are two funds that specialize on the region:

Roundhill iGaming and Sports Betting ETF: When it comes to investing in sports betting and online gambling, this newer fund is your best chance. However, the expenditure ratio is a high 0.75%.

Gaming ETF (BJK) of VanEck In addition to the prominent sports betting firms, this fund also includes more typical casino operators. There is a 0.65% cost ratio for this investment.

An ETF might be an excellent choice for someone who wishes to bet on the sector’s overall development..

Racetracks are the fourth.

One of the best publicly traded options for those interested in horse racing is a well-known brand: The Breeders’ Cup.

Kentucky Derby host track Churchill Downs (CHDN) has much more to offer than merely the yearly event. It runs the TwinSpires online sports betting platform, which accepts bets on horses as well as other sports. Plus, it has a wide range of classic casino games available in a variety of venues, so it’s not a one-trick pony.

Providers of information and communications technology

The firms that offer the technology that powers gaming may also be a source of investment. It’s like putting money into a gold rush “picks and shovels” company. Here are a few of the more common ones:

A number of gaming software products are provided by GAN (GAN), including those used by industry heavyweights like FanDuel. In addition to sports betting, it also enables virtual simulation gaming and internet gambling.

Kambi Group (KMBIF) is another “name behind the name,” providing sports-betting technology to both online and brick-and-mortar casinos.

Risks

Consider the dangers while deciding whether to invest in a certain stock or even the gaming industry as a whole. A few of the most relevant to sports betting investments at this time are included below.

Regulated: Gambling is a highly taxed and strictly regulated industry. Online gambling and sports betting are becoming more common in the United States, but many states still impose onerous regulations and heavy taxes on the enterprises that engage in these activities. A lot of states want to make more money by legalizing gambling, so they charge a lot of taxes on an industry that most people don’t think has much social benefit.

As with any investment, it’s important to keep an eye on the price you’re paying in exchange for the prospective rewards. Because of the high hopes for development in the sports betting industry over the next decade, a large number of investors have invaded the sector. Future returns may be less appealing or non-existent since they have already bought prices up so high.

Prior to making an investment, you’ll need to take into account a variety of additional considerations.

The gist of the matter

Investing in sports betting might be a smart move, particularly as new forms like app-based betting develop in popularity. ETFs, on the other hand, allow investors to play the market in a variety of ways, including a broad-based recovery play on betting.