Macro Insights: What the metaverse means?

METAVERSE: The metaverse incorporates video, augmented and virtual reality. Also, a shared architecture allowing virtual goods and identities to move between platforms. The term is 20 years old, from Neal Stephenson’s sci-fi novel ‘Snow Crash’, but development accelerating now. It will require larger processing capacity and bandwidth and improvements to headsets, glasses, and smartphones. Market size forecasts reflect this huge breadth and its early-stage, from $800 billion to trillions. Boosted industries range from gaming and advertising, to NFT’ and luxury.  

FACEBOOK: Metaverse interest was catalysed by Facebook’s July Meta Platforms rebrand and focus building a ‘immersive’ ecosystem. It hopes to have a billion users within a decade and sees it as a ‘successor to the mobile internet’. But it is far from alone. Microsoft (MSFT) is creating a metaverse in Teams called ‘Mesh’. Nvidia (NVDA) has its Omniverse platform and graphics chips. Unity Software (U) its three-dimensional content platform. Immersive mobile gaming Roblox (RBLX) is a leader, and Tencent (0700.HK), the world’s largest gaming stock, entering.

EXPOSURE: The only US listed metaverse ETF is the $900 million Roundhill Ball Metaverse ETF (META), launched in July. It is +5% since, underperforming NASDAQ. Facebook fell 8% in the same time. Whilst others commonly seen as metaverse beneficiaries have done better it is clearly early days and the market differentiating. We see the gaming community enjoying a first mover advantage in developing metaverse components. See the smart portfolio @InTheGame.

TODAY: US inflation focus as Fed set to accelerate move to tighten monetary policy. Estimates are for a pick up to 6.9% inflation, setting a new 30 years high. The Fed next meets Dec. 14-15.

All data, figures & charts are valid as of 09/12/2021

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