Video Game and Gaming Stocks: Top Picks and Investment Tips

ABOUT THE GAME STOCK MARKET?

Gaming offers both an interactive and a social experience to users. Games occupy more than 40% of mobile app usage (across both Androids and iPhones) and almost 70% of all tablet use. Players begin young and they don’t really stop playing as they age…which means a lot of gamers.

The gaming industry is flourishing with awesome growth potential. The rising number of Internet and mobiles users combined with fast moving tech ensures a growing number of prospective consumers. It was estimated by the Entertainment Software Association back in 2012 that the U.S. video game industry grew four times faster than the entire U.S. economy from 2009 through 2012. Going forward, worldwide game sales are very likely to soar by the billions.

TIPS FOR INVESTING IN GAMING STOCKS

Video games have come a long way. With the industry going digital and mobile gaming generating huge revenue, things are moving fast. Like, real fast. Here are a few important things to keep in mind when comparing companies:

What Products Are Coming Out, And On What Platform

Zynga, for example, relied on Facebook as their platform. What products are coming out and on what kind of platform are important questions to ask when considering a video game maker.

Recent stock performance

Stocks that have been going up in value may continue to do so, but investors can get carried away when looking at poor performing stocks. Usually, the stock will eventually rise to correct its price back to its “true value.”

Who’s buying (or selling) the stock

“Sophisticated investors” (AKA hedge fund managers and mutual fund managers) are forced to report when they are buying and selling stocks. If they are buying, it’s probably for a good reason. Don’t go blindly copying their every move, though. It’s important to keep in mind that there’s usually a time lag between purchase and report.