Gaming Stocks – Investing in the Gaming Industry

Gaming Stocks – Investing in the Gaming Industry

Introduction

The gaming industry saw an amazing boom and growth in the year 2020. People saw a turn in their interests towards the virtual world. This turn was to entertain themselves through games in the period of lockdowns. As part of the entertainment sector, gaming is the only industry to defy all odds during the helpless and disastrous long Covid-19 phase. In 2020, the gaming industry made more than the music, movie, and video industry combined, to everyone’s surprise.

Research shows that at the end of 2020’s Q1 alone, there was an almost a 218% increase in physical games sales. There was also a 67% increase in digital downloading every week, proving that people didn’t take their games lightly. Around March this year, an announcement on a strict lockdown further gave all gamers a chance to invest more time and money in the gaming industry.

The Impact of Covid-19

Covid-19 had a huge impact on the entertainment sector, especially gaming. With a ban on movie premiers, sports events, traveling, clubbing, and partying, gaming took over as the only accessible activity during the early months of lockdown. There was no entertainment you can enjoy at home other than putting on a game and see yourself winning. This still holds true because Covid-19 hasn’t left us. All kinds of games are now easily accessible and available on apps, mobiles, and PCs. This accessibility has proved helpful for people who only had a phone or a PC to entertain themselves during the lockdown period.

Interestingly, it wasn’t just the old gaming enthusiasts during the first lockdown period, but so many new people also took part in various video games. A rise in new gaming users was substantial. During social limitations, people over 60 took gaming as an opportunity to shape their brains and build a connection with their grandchildren online.

Job Growth in the Gaming Industry

A flourishing job market is a crucial indicator of growth. One of the most visible indicators of the UK’s flourishing gaming industry is the rise in the rate of available jobs. The UK’s talent is unmatched, especially in the technology and the gaming sectors.

Despite the 2020 crisis, experts and financial analysts have noticed an increase in vacancies in almost all gaming companies in the UK. All IT-related vacancies in the gaming sector rose to 43% only in the first half of this year.

According to predictions, if the Covid-19 situation remains the same, 2021 won’t be different. Vacancies for game programming will rise to 154%, developers will see a 91% increase, and project management will see a 140% rise. If this isn’t enough, both audio specialists and creative artists will encounter an increase in demand for their services. In 2021, the vacancies for these two positions will increase by 79% and 59%, respectively.

The Future of the UK Gaming Market

Currently, the UK’s gaming industry stands at a profit of £4bn. According to predictions, this value will rise to £10bn in the next three years. The number of gaming employees today will also see a triple-rise within the next five years. Countries like China, Japan, Korea, and the US have always been big players in the gaming industry. The UK is still very tiny when it comes to these giants, but even then, after the Covid-19 crisis, it takes the fifth spot on the list of giant gaming markets around the world. This position, as predicted above, will only get better with time.

Everything You Need To Know About Gaming Stocks

With the very flourishing insights into the UK’s position in the gaming industry, it is unfair to not learn about all the investment prospects. With so many positive signs and a very bright future, investment in this industry is one of the best things you can do for yourself.

There are many ways you can invest in. For starters, you can either create a share dealing or a trading account. You can also start with a demo account to experience how price movement works and whether you feel good about it. But before you set an account, you need to know a lot more such as the companies you need to invest in. Read below to understand everything you must know before you step towards investing.

Believe it or not, the gaming industry is far bigger than both the music and movie industry combined. There has been a great rise in gaming tournaments and competitions. A huge number of people love to watch other players play through streamed games rather than play themselves.

The Three Categories

The gaming industry is growing with the speed of light. This industry has great potential, and this is why gaming stocks are gaining exceptional popularity.

Gaming stocks are divided into three major categories. These categories are as follow:

  • Companies that design and develop games
  • Companies that design and release gaming software
  • Companies that design gaming consoles and develop all other gaming accessories

Buy or Invest in Gaming Stocks

In the gaming industry, the terms of buying and investing hold different meanings. They might sound similar to you, but they have different procedures. When you buy a gaming stock, you occupy a long-term position with CFDs and spread bets. These make you hold a speculative position. You do not own any assets directly. You gain with a rise in the asset’s price. On a fall in the asset’s price, you choose to sell the asset whenever you like.

On the other hand, an investment in the stock market gives you ownership of the asset. You become a shareholder. You can receive dividends and have a voting right. People who wish for a long-term affiliation with a company choose investment over buying.

To buy gaming stocks, follow the steps below:

  • Create a trading account and log in. Go to the trading platform.
  • Choose between spread bets and CFDs. Decide which one you want to trade.
  • Look for a stock.
  • Select a position size.
  • Click buy.
  • Monitor your trade.

To invest in gaming stocks, follow the steps below to invest in gaming stock:

  • Create a share dealing account and log in.
  • Go to the trading platform.
  • Look for a suitable market.
  • Click buy in the deal ticket.
  • Open the investment position.
  • Select the number of shares you want to invest in.
  • Confirm.
  • Monitor your investment.

Top 8 UK Gaming Stocks

We have listed our top 8 gaming stocks below. These are not ranked in any particular order. The list below covers all three categories of stocks mentioned above. Have a read!

  1. Activision Blizzard Inc (LSE: 0H8X)

This corporation is a California-based company but also listed on the London Stock Exchange. Activision Blizzard Inc develops top-quality video games. It has designed Call of Duty, Candy Crush, Crash Bandicoot, World of Warcraft, and Spyro. These are compelling games with a big following. The World of Warcraft: Shadowlands is the fastest-selling game ever. On its first release day, this game successfully sold 3.7 million copies.

However, just recently, a few allegations have come up against this company. People accused Activision Blizzard of disparities in the wage system. The top hierarchy executives received millions while the rest received way below what they deserved.

  1. Konami Corp (LSE: KNM)

This is a top-listed gaming company on the London Stock Exchange. This company comes under the category of multinationals because of its Japanese origin. It doesn’t purely develop games. It also designs products for the fitness and the health industry. Gaming, though, heavily contributes towards Konami’s bread and butter.

  1. NetEnt (LSE: 0XX7)

This company is a great example of corporations that develop gambling software. However, in June 2020, Sweden’s Evolution Gaming made an announcement. It said it was trying to buy NetEnt through a $2.1bn deal. The UK Competition and Markets Authority is investigating the deal.

  1. Nintendo (LSE: OR1E)

This is another popular name in the gaming industry. It has world-wide popularity and some top-rated childhood franchises to its credit. These are Mario, Pokémon, Donkey Kong, Smash Bros, and Animal Crossing.

Nintendo has also developed some top-quality consoles in all these years. These include the Wii, Nintendo DS, Game Boy, and Nintendo Switch. Before releasing these consoles, Nintendo developed a lot of arcade cabinets. These cabinets became quite popular in the 80s and 90s. The Nintendo Switch has gained a lot of popularity recently. This console is responsible for a 75% increase in Nintendo’s revenue in 2020.

Nintendo is also listed on the Tokyo Stock Exchange and Mexican Stock Exchange because of its immense popularity.

  1. Ubisoft (LSE: 0NVL)

This is a French-based developing company with a London listing. This company only develops video games. It has listed its play video gaming stock on the London Stock Exchange. Unlike Konami, Ubisoft hasn’t ventured into other sectors. It runs two successful franchises, Rayman and Far Cry.

  1. The Sony Corporation (LSE: 0L83)

This company is the parent company of Sony Interactive Entertainment. Sony Interactive Entertainment has designed the very popular PlayStation console, and PlayStation 5 is their latest release. The SIE is the biggest video game console company around the world. Thanks to its product, PlayStation, no company has even come close to this big gaming giant. It also takes the second position as the largest publisher for video games.

The latest release, PlayStation 5, is bound to gain immense commercial success in the year 2021. It has promising features and all the wonderful games. In addition to being listed on the London Stock Exchange, the Sony Corporation is also listed on the Tokyo Stock Exchange and the New York Stock Exchange.

  1. Electronic Arts (LSE: 0IFX)

Electronic Arts or EA develops video games. Games like Battlefield, The Sims, Medal of Honor, Need for Speed, and Star Wars are all EA’s productions. Electronic Arts have various divisions within its corporation. These divisions focus on different other gaming genres such as EA Sports.

The EA Sports division deals with games related to franchises like Madden NFL, FIFA, and NBA. EA Sport releases new versions of all these games every other year, sometimes even twice a year. All the new versions come with new teams, players, and layout.

The best thing about these games is that you can also play them on Sony’s PlayStation 5 and all Microsoft’s (MSFT) Xbox consoles. Some EA Sports games are available to play on PCs. These games all feature the very well-designed Nvidia GPUs.

  1. Keywords Studios (LSE: KWS)

You can also choose to invest in companies that support the gaming industry. This is another great way to gain exposure to this exceptional growth we are all witnessing. Keywords Studios is an AIM-listed company. This company excels in technical services like adaptations, translations, art creation, and audio testing.

This company provides all these services to the gaming industry. Keywords Studio is currently operative in 20 countries and has close to 1,000 clients around the world. This company has given services to games like Call of Duty, Fortnite, Clash Royale, League of Legends, and Rainbow Six Siege.

Keywords Studio has shown rapid growth over the last four years. This growth is more than any other company with similar products has shown. If you plan to invest in shares of companies with similar services mentioned above, look out for Keywords Studio.

Conclusion

Although Covid-19 has affected many companies and their profits, it is safe to say that the gaming industry is secure and is still untouched by the wrath of this virus. To put it straight, there is no time better than today to invest in a gaming stock on the London Exchange market. Utilize your saved money and do something good for yourself!

Getting in on the gaming stocks will give you a chance to enter one of the most booming and prosperous industries in the world. There are several gaming companies you can invest in, so make sure that the choice you make is worth it.

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