September: Demand still high

Concerns in the market regarding growth, inflation and long-term interest rates have continued in September. Inflation concerns have spread to wage increases in the US and most companies are having trouble getting some goods due to shortages and shipping problems. There is a great risk that several physical goods will be out of stock in the Christmas trade and that this will also affect the companies that depend on advertising.

Demand for computer and console games remains strong and consumers can look forward to several major titles in the coming months. Interesting to note that Netflix bought its first game studio focused on mobile games. Amazon seems to have a big hit in the game New World which is number one on most platforms.

The valuation of the major gaming companies is at historically attractive levels with companies such as Nintendo and Activision Blizzard trading below 15x operating profit. The sector has mainly performed weakly because the market is worried about declining demand when societies open up. We believe the market has too negative a view of gaming and esports companies and that sales will continue to be strong.

Global Esports Fund was down -4,64% in September and is now up 9,45% so far this year.