VIDEO GAME STOCKS

One of the most basic pieces of stock advice I ever read was from Warren Buffett, who said to invest in what you know. I don’t know much about semi conductors or the pharmaceutical field but I do know and love video games. I am also very aware how having some of the most popular games or systems doesn’t always equal out to good returns. There are a lot more factors involved that are deeper than my understanding of the stock market, however I fully believe that if you have a good product and keep producing good products that the ROI will follow. Which leads me right into my next point, video game stocks are not an overnight success. Most performing stocks take 6 months to a couple of years for things to move upward. There are usually a lot of balls in motion at these large corporations and the bigger the company the slower it becomes for a course correct if things aren’t heading in the right direction.

Full disclaimer, I am not a financial advisor but as an avid gamer I can look and see patterns from companies and I can also look at the future plans of a public company through the earnings reports. It also helps to be an actual gamer to have a finger on the pulse of how a community is reacting to their products and offerings.

I think having a pulse on the gaming culture as an avid gamer combined with a business degree allows me to see things and make judgement calls based on all the information in front of me. It doesnt take away from my enjoyment of video games at all if a company is having a bad year. Larger corporations like Sony and Microsoft have multiple divisions so even if the gaming division is doing great other departments in the company may cause the stock to rise or fall.

One major thing to keep in mind is that you are doing this to try to make money on video games. Most companies that are publicly traded are not going to be cool indie developers you love. These are going to be the bigger companies that have lots of employees and. As much as I would love to invest into something smaller and more independent the reality is that those companies are too small to be traded on the stock market.

The long version, shortened in my opinion is that video games are becoming more mainstream every day. The install base of gamers grows exponentially daily with more smartphones, tablets, and connected devices. You don’t need to own a expensive rig to be able to give publishers and developers your money. I don’t think that home consoles that sit in your entertainment unit is the future, but there will always be a need for video games, entertainment and escapism. Life has only seemed to have increased in speed and with that comes tougher times and during tough times its sometimes good to take a minute. The video game market is not for the faint of heart because it can be volatile at times but if you weather the storm you should come out dry on the other side