Gambling stocks were hot in 2020, especially those of companies with online exposure. Many people turned to online casinos when land-based casinos were forced to shut down due to the pandemic. Investors were quick to get in on the action by snapping up stocks, but there is an easier way to invest in online gambling.
Exchange-traded funds offer the ease of trading stocks with the benefit of owning more than one online gambling stock in a single fund.
VanEck Vectors Gaming ETF
Investors who want easy exposure to gambling, in general, might want to check out the VanEck Vectors Gaming ETF, which trades under the ticker symbol BJK. It's important to note that the ETF includes not only online gambling companies but also land-based casinos.
The ETF attempts to replicate the performance of the MVIS Global Gaming Index, which tracks the performance of casinos and casino hotels, sports betting firms, gaming services, and gaming equipment and technology.
All constituents of VanEck's ETF must derive more than half of their revenues from the global gaming industry. Among the top 10 holdings are Flutter Entertainment, DraftKings, Las Vegas Sands, MGM Resorts and Caesars Entertainment.
Roundhill Sports Betting and iGaming ETF
Investors who want to target online gambling more than land-based casinos might be interested in the Roundhill Sports Betting and iGaming ETF, which trades under the symbol BETZ. The ETF corresponds to the Roundhill Sports Betting and iGaming Index. It's the first index designed to track the performance of the sports betting and iGaming industry.
The ETF includes companies that operate in-person and online sportsbooks and online gambling platforms. It also includes businesses that provide technology or infrastructure to those firms. Some big names are among the fund's top holdings, such as Flutter Entertainment, Penn National Gaming, DraftKings and William Hill.
Invesco Dynamic Leisure and Entertainment ETF
If you're looking for a little exposure to gaming mixed in with other entertainment stocks, you might want to check out the Invesco Dynamic Leisure and Entertainment ETF, which trades under the symbol PEJ. The ETF is made up of 30 leisure and entertainment companies in the U.S., including some with exposure to the gambling industry.
It's important to note that only one of the fund's top 10 holdings is in the gambling industry. Penn National Gaming is its tenth largest holding. Other top holdings include Hilton Worldwide, Yum! Brands, Walt Disney, Fox and McDonald's.
This year is likely to be an exciting one for the gambling industry. Investors can reap the benefit of higher earnings by tapping into an ETF that offers exposure to the gambling business.
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