September: Esportsfonden utvecklades positivt trots svag månad för teknologi

September: The esports fund developed positively despite a weak month for technology

Inge Heydorn

Volatility in the market continued during September and the technology companies were weak with a decline for the Nasdaq of 5.2 percent, the Dow Jones ending only down 2.3 percent. This was the first negative month since March. The big companies within FAANG were the big losers. The valuation multiples for these companies have expanded strongly during the year. However, they differ slightly between the companies as Amazon and Netflix have had their profits adjusted up during the year, while the others have had them adjusted down in the wake of Covid. 

The esports market is growing very strongly and we see daily new investments in esports from companies worldwide; Ferrari, Ikea and Adidas to name a few new projects.

The esport fund ended up 1.36 percent during the month despite the negative sentiment on the Nasdaq. We made no major changes to the portfolio during the month with the exception of buying a bit more Sony and starting to build a position in Prosus. By buying Prosus, we get to buy Tencent at a discount as this is the main part of the value in the company.

We expect strong reports from all companies during the quarter, even though we have the big upgrades from Sony and Microsoft in terms of game platforms at the end of the year. Above all, we believe that Activision will strongly beat the market's and their own expectations during the quarter.