ClearVue Technologies Ltd (ASX: CPV) shares were rocketing today after the company announced the completion of another dual listing. By the market’s close, the ClearVue share price was trading at 90.5 cents, 13.13% higher than Friday’s closing price. Earlier in the day, the company’s shares rallied by as much as 18.75% to 95 cents before retreating to their current level. 

From today, ClearVue will be listed on the US-based OTC Market Group Inc.’s OTCQB Venture Market.

ClearVue is a building materials technology company. It works to integrate solar technology into building materials such as glass and facades.

Let’s take a look at what ClearVue announced.

ClearVue’s newest listing 

ClearVue states it has listed on the OTCQB market to allow US- and Canada-based investors more access to the company’s shares. It will also allow these investors to trade ClearVue shares during US trading hours and in US dollars.  

The OTCQB market is the middle tier of the over-the-counter (OTC) marketplace. It’s mostly made up of early-stage and international companies.

An OTC marketplace means there is no broker or exchange in between a seller and a buyer.

There are thorough financial reporting and corporate governance requirements that companies listing on the OTCQB market must adhere to. ClearVue stated it satisfied all of the conditions with its previous ASX compliance.

The ASX will continue to house ClearVue’s primary listing. The company is also listed in Germany on the Frankfurt Stock Exchange, the Stuttgart Stock Exchange and the Berlin Stock Exchange.  

Commentary from management

ClearVue executive chair Victor Rosenberg commented on the company’s new listing, saying:

The Company has a large commercial focus on the key market of the US where we see significantly increased interest in potential sales enquiry activity following the new focus on infrastructure renewal, climate change and renewable solutions under the new administration in Washington.

ClearVue share price snapshot

The ClearVue share price is having a roaring time on the ASX (and its other exchanges) lately, with today’s news just its latest boost.

Currently, the ClearVue share price is up by 206% year to date. It’s also up by 579% over the last 12 months.

The company has a market capitalisation of around $123 million, with approximately 154 million shares outstanding.

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• The ClearVue (ASX:CPV) share price is up 65% in a month. Here’s why

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Promising young ASX tech company Nuix Ltd (ASX:NXL) has had a rocky start to life on the share market. After first listing on the ASX in early December, its share price soared as high as $11.855, before plunging more than 60% to a low of just $4.20. And even after a modest recovery more recently, its shares are down another 3% today and are currently trading at only $4.47.

Let’s first take a look at what Nuix does, and then investigate the reasons for the massive decline in its share price.

Company background

Nuix is a data analytics company. Its software is designed to help its clients sift through massive amounts of data – including things like social media posts and emails – to deliver insights and actionable solutions. For example, the company’s digital forensics software has been able to help police in Scotland investigate complex fraud cases. In some instances, Nuix was even able to help police cut down the investigation time from years to a matter of months.

Recent announcements

The Nuix share price really went south after the release of the company’s first-half FY21 results. Revenues declined by 4% year-on-year (to $85.3 million), while net profit after tax (NPAT) came in at $9.5 million.

It wasn’t a terrible result for a junior tech company, but it fell short of its own expectations. First half revenues only made up 44% of the company’s full year forecast, while NPAT was 48%. This result underwhelmed investors, and left Nuix with plenty of ground to make up over the second half of the year if it planned to hit its performance targets.

Then, last week, we found out that even Nuix no longer believed it could hit those targets. The company released an updated forecast for FY21, in which it downgraded its full-year revenue target from $193.5 million to between $180 million and $185 million. It also stated that it now expected annualised contract value (ACV) to be between $168 million to $177 million (well below its prospectus forecast of $199.6 million).

Nuix blamed the downgrade on customers switching from “module-based subscription licenses to consumption and Saas [software as a service] license models, resulting in a shift in both revenue and ACV profiles.” While this has had a negative impact on the company’s short-term revenues, Nuix stated that it does not “diminish Nuix’s growth prospects which remain strong, as evidenced by ongoing increases in new customer acquisition and retention.”

There may be some evidence to support this assertion, with the company adding more customers in the nine months ending 31 March 2021 than it had done over the prior comparative period. Nuix has also entered into a number of longer-term (2 to 5-year) contracts with major customers, including a top US law firm and a French financial services company.

Where next for the Nuix share price?

It’s hard to say what will happen to the Nuix share price over the short to medium-term. Unfortunately for Nuix, it has made the mistake of disappointing the market in one of its first financial announcements since listing on the ASX.

The release of the FY21 revenue downgrade – no matter the underlying cause – hasn’t done the company any favours either. It means that the second half of FY21 may well turn out to be a crucial period for the Nuix share price as the company tries to regain some investor trust.

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Rhys Brock owns shares of Nuix Pty Ltd. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Nuix Pty Ltd. The Motley Fool Australia has recommended Nuix Pty Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Talga Group Ltd (ASX: TLG) shares are on fire today. At the time of writing, the Talga share price is up a staggering 22.79% to $1.67 after closing at $1.36 last week and opening at $1.51 this morning. In earlier trade, the company’s shares rallied by almost 32% to $1.79 before retreating to their current level. 

Until today, Talga had not been having a very successful 2021. Year to date, Talga shares had fallen by more than 25% at Friday’s closing price, and even after today’s move, remain down by around 10% in 2021 so far. However, Talga is up by around 36% since 31 March. Over the past 12 months, the company has also done extremely well, up by more than almost 380%.

So what is Talga? And why is this company worth almost a quarter more today than it was on Friday?

What is this company?

Talga is an ASX materials and technology company. It hopes to be a vertically integrated player in the mining and manufacturing of battery anodes, specifically those made from graphite and graphene. Talga owns the Vittangi Project in Sweden, which is reportedly one of the world’s highest-grade graphite depositories.

The company plans to use the minerals from this project to manufacture “a high margin coated anode product known as Talnode to be sold to lithium-ion battery cell manufacturers”. Talga tells investors that it has 36 customer “engagements” for Telnode, including “six major global automotive OEMs”. 

So why is the Talga share price rocketing today?

Today’s share price move is a strange one. That’s because it has not been prompted by any fresh news or announcements out of the company today. The Fool isn’t the only one who has noticed this either. This afternoon, Talga was issued with a please explain speeding ticket by the ASX over the dramatic surge in the valuation of its shares.

In response, the company stated that it was not aware of any unannounced information that might be affecting the Talga share price today. However, it did note that “the battery materials sector, in which Talga operates, has recently seen a significant increase in positive sentiment”.

It’s also worth discussing the announcement that Talga made last week. Although this was back on Monday, it’s possible that a large investor has taken late notice.

In this announcement, Talga reported that the design of its electric vehicle anode qualification plant in Northern Sweden has been completed, and “engineering is progressing well”. Further, Talga stated that “requisite procurement work has commenced with orders placed for major equipment”. Once complete, the plant will also house a “fully equipped battery materials laboratory, including battery cell making facilities for cycle testing”.

That’s all of the news out of Talga today. As mentioned earlier, it is possible that a large or institutional investor has made a significant buy into the company. This may have caused the massive appreciation in the Talga share price. ASX data shows that, as of the time of writing, 6.1 million Talga shares have traded today. That’s significantly above the 464,500 shares that swapped hands on Friday. 

At the current share price, Talga has a market capitalisation of $488 million.

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Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Empire Energy Group Ltd (ASX: EEG) share price is in negative territory in late-afternoon trade. This comes despite the company announcing an update on the acquisition of the EMG Northern Territory’s (EMG NT) Beetaloo interests.

At the time of writing, the Empire Energy share price is swapping hands for 31 cents a pop, down 3.1%.

Details of the acquisition update

According to its release, Empire Energy advised that EMG NT has delivered a notice of exercise of tag-along right to Pangaea. A tag-along right comprises of a number of clauses (co-sale rights) that aim to protect a minority shareholder. Essentially if the majority shareholder sells their stake in an asset, it allows the smaller shareholder to follow suit and sell their holdings.

Empire Energy plans to acquire an 82.5% interest in 5 oil and gas tenements in the Northern Territory’s Beetaloo sub-basin. Pangaea, the majority shareholder of those interests, will receive $5 million in cash and 140 million Empire Energy shares. In addition, there will be 8 million unlisted options attached to the shares with an exercise price of 70 cents apiece.

The remaining 17.5% interest that EMG NT holds will now also be sold on the same pro-rata basis. Empire Energy will seek shareholder approval at the extraordinary general meeting to obtain the green light for the acquisition.

If approved, EMG NT will receive $1.06 million in cash along with close to 29.7 million Empire Energy shares. Furthermore, almost 1.7 million options will be available to acquire ordinary Empire shares at 70 cents each.

Should all go to plan, Empire Energy will own a 100% interest in all its Beetaloo and McArthur Basin properties.

About the Empire Energy share price

Over the last 12 months, the Empire Energy share price has gained roughly 70%, however year-to-date performance is down 14%. The company’s shares have been mostly travelling sideways since October last year.

Empire Energy presides a market capitalisation of approximately $110 million, with 363 million shares outstanding.

More reading

• Why the Empire Energy (ASX:EEG) share price is on watch today

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The RMA Global Ltd (ASX: RMY) share price is rising today after the company released its quarterly business update outlining increases in recurring revenue. 

The RMA Global share price is currently up 3.85%, trading at 27 cents per share.

RMA Global is an Australia-based online digital marketing business. It provides data on residential property sales in particular and usually performs strongly in periods of increased housing market demand, such as the current time.

The company generates revenue from subscription services and promoter services. Geographically, it has a presence in the United States, Australia and New Zealand (ANZ), but it derives most revenue from ANZ markets.

RMA Global’s quarterly business update

RMA Global advised that its recurring revenue for the third quarter of FY21 was $2.97 million, up 17% quarter-on-quarter (QoQ) and 59% year-on-year (YoY). Cash flow also improved, with net receipts from customers in the same quarter FY21 of $3.66 million, up 19.5% QoQ and 59% YoY.

In the United States, it now has 115,000 real estate agents on its platform and 109,800 reviews. Total agents on the platform and the total number of reviews for this quarter of FY21 increased by 148% and 363%, respectively, compared to the same quarter last financial year.

RMA says its US focus is to drive agents on the platform and reviews. As of 19 April 2021, there were 115,000 agents on the US platform who have collected a total of 109,800 reviews (including imported reviews). RMA says this increase reflects a continuing strong agent uptake and engagement with the platform.

While the US focuses on increasing agents on the platform and their reviews, subscription revenues are growing, with 193% higher revenues generated in 1H FY21 compared to 2H FY20, but off a low base. RMA says its revenues are expected to increase in the second half of FY21 as the company allocates more resources to monetising the agent base.

It also announced continued growth in all products across Australian and New Zealand (ANZ) markets. In addition, RMA said that the coronavirus pandemic has had no material impact on its business to date, which could be due to record-low interest rates across the world and the increased demand on the housing market.

What RMA management says

RMA CEO Michael Davey highlighted the company’s 18% increase in ANZ markets.

We are very pleased with our growth in ANZ over the last few months, which has surpassed our expectations. In a rapidly changing environment, we are able to adapt to our customers’ needs which is reflected in our growing revenues and increasing customer engagement.

The US has also seen us accelerate the number of agents on the platform and we anticipate an exciting pipeline of activity to come in the second half of the year.

RMA Global share price snapshot

The RMA Global share price is down 10% since 2021 began. It has gained 8% over the past 12 months, but that’s significantly lower than the broader communications services sector.

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Motley Fool contributor Lucas Radbourne-Pugh has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Australian Prudential and Regulatory Authority (APRA) has released draft guidance for financial institutions, including ASX bank shares like Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), Australia and New Zealand Banking Group Ltd (ASX: ANZ) and National Australia Bank Ltd (ASX: NAB), about climate change.

APRA says the guidance “is designed to assist APRA-regulated entities in managing climate-related risks and opportunities”.

Last month, Motley Fool Australia conducted an interview with the Climate Council of Australia, in which one of its economists said climate change could lead to “a COVID-sized shock every year.”

While it is unlikely APRA’s announcement in and of itself will have any noticeable, short-term impact on ASX bank shares, it is indicative of the future operating environment these giant financial institutions will be operating in.

Let’s take a closer look at the draft guidance.

APRA’s draft guidance on climate change

Last Thursday, APRA announced its release of the draft Prudential Practice Guide CPG 229 Climate Change Financial Risks. The government regulator says the draft guidance was released because industry wanted greater certainty about its future risks and exposure to climate change.

As the draft paper is only a guidance, it does not place any new regulatory burdens on ASX bank shares. The regulator says its approach “is designed to be flexible in allowing each institution to adopt an approach that is appropriate for its size, customer base and business strategy.” Banks will not be compelled to divest out of any high-emitting industries, refuse loans, or readjust insurance claims because of climate change.

APRA chair’s comments

APRA chair Wayne Byres commented that it is important for financial institutions to be well-prepared for any and all financial risks. He said:

Since the Australian Government became a party to the Paris Agreement, APRA has been raising awareness of climate-related risks to the financial sector. Given the unique and long-term nature of the risks, however, processes to measure, monitor and manage climate-related financial risks are still developing.

The prudential practice guide doesn’t direct or prevent APRA-regulated entities making any particular business or investment decision. Rather, it is aimed at ensuring decisions are well-informed and appropriately consider both the risks and opportunities that the transition to a low carbon economy creates.

Additionally, speaking to the Australian Broadcasting Corporation (ABC), Mr Byres said he wants to ensure Australia’s largest banks are taking the risks of climate change seriously.

The climate is changing, government policies around the world are changing, that’s impacting economies and industries that are changing, investor expectations are changing, and in some cases all of that change is happening quite quickly.

How will ASX bank shares respond?

Motley Fool Australia approached the largest of the ASX banks by market capitalisation for comment on APRA’s climate change guidance. A spokesperson for ANZ said, “ANZ welcomes further guidance from APRA and is reviewing the document.”

A Commonwealth Bank spokesperson said:

We are aware of, and are currently reviewing, APRA’s draft guidance on managing the financial risks of climate change that was released last week. We continue to work closely with APRA and the broader industry as we strive to limit climate change in line with the goals of the Paris Agreement and support the global transition to net zero emissions by 2050.

The spokesperson added that Commonwealth Bank has been disclosing how it is managing climate-related risks since 2018.

A spokesperson for National Australia Bank, when asked for comment, redirected Motley Fool Australia to comments made by its chief risk officer, Shaun Dooley, to the Australian House of Representatives Committee on Economics.

In his comments to Parliament, Mr Dooley said the bank was working closely with APRA to understand, and get ahead of, the financial risks of climate change.

Westpac and Macquarie Group Ltd (ASX: MQG) did not respond when asked for comment.

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Motley Fool contributor Marc Sidarous has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Elixinol Global Ltd (ASX: EXL) share price is rising today after the company released its quarterly activity update.

At the time of writing, the Elixinol share price is up 5.88% to 18 cents per share.

Elixinol’s focus is the manufacture and distribution of industrial hemp products and early-stage medical cannabis business focusing on the importation, cultivation, manufacture and distribution of CBD and THC products (using the active compounds in marijuana). 

Elixinol’s quarterly business update

Elixinol’s focus in its latest update was its “highly value-accretive” acquisition of leading German hemp-derived CBD player, CannaCare Health. According to the company the acquisition will deliver fast market entry and immediate, material scale in Europe’s fastest growing CBD market.

Elixinol also highlighted its financial position, stating it was “well-funded”, with $23.3 million in cash and equivalents to support acquisitive growth and sustain conditions in those markets — particularly its European ambitions — that are still COVID-affected.

In terms of sales, Elixinol reported a first-quarter FY2021 revenue of $2.3 million, which was a 26% decline on the previous quarter. In that period the company made $3.1 million.

In some good regulatory news for Elixinol, its products are now supported by a valid novel food application under the UK Food Standards Agency (FSA), which could lead to greater sales revenue in the future.

It’s predicting growth in that market over the coming months, as the UK re-emerges from lockdown and Elixinol retailers begin to restock their orders.

What Elixinol management said

Elixinol Global CEO, Oliver Horn, said the company had struggled due to the coronavirus pandemic.

The first quarter of the calendar year is traditionally softer for retail, while consumers curb discretionary spend after Christmas and holiday trading periods. This seasonal trend was compounded by the continued impact of COVID in two of our key markets: the UK and US, where footfall into physical venues continued to be significantly reduced.

Pleasingly, in March we saw green shoots start to appear both in the UK and the US as the impact of economic stimulus packages, easing of COVID restrictions came into effect and increased vaccination rates started lifting consumer confidence.

Elixinol share price snapshot

The Elixinol share price has been a relatively steady faller since a very short-lived high of 47 cents a share in May 2020. Since then it’s risen above 25 cents in December 2020 and February 2021, but has spent most of its time below the 20 cent mark.

It’s now level with the start of 2021, but has lost 45% over the past 12 months. 

More reading

• Here’s why ASX cannabis shares are lighting up today

Motley Fool contributor Lucas Radbourne-Pugh has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The Hexagon Energy Materials Ltd (ASX: HXG) share price is rocketing today after the company released its quarterly activities and cash flow report.

The Hexagon Energy share price is up 40.9% at the time of writing, trading at 15.5 cents per share.

Hexagon Energy is a mineral exploration company focused on downstream graphite and rare earth processing. Its rare earths project includes RAPID SX, and graphite includes the McIntosh Graphite Project in the Kimberley region of Western Australia. Operations are also underway at the Halls Creek Gold & Base Metals Project in WA.

The Hexagon share price has been a fast mover in recent days after the company acquired Ebony Energy on 23 April. This has enabled Hexagon Energy to start the development timeline for Ebony’s Pedirka Blue Hydrogen Project, which will spearhead the company’s shift towards renewable energy production.

Quarterly activities and cash flow report

In the report, Hexagon Energy outlined its plans following the acquisition of Ebony Energy. The acquisition means Hexagon now has full control of the Pedirka Blue Hydrogen Project in the Northern Territory. 

It plans to immediately start a pre-feasibility study for Pedirka, which is slated for completion this year. Hexagon is also gearing up for a drill program at Halls Creek and has secured an electromagnetic survey. It’s also in ongoing discussions to “create shareholder value” at its McIntosh and Alabama projects.

The Pedirka project covers an area of just under 800km. Hexagon said the acquisition was timely, given the Australian government’s commitment to provide $275.5 million in funding to develop four regional clean hydrogen hubs and $263.7 million for carbon capture and storage technology in its upcoming budget.

Hexagon proposes that the project host a surface gasification plant producing “blue” hydrogen to supply domestic and export markets from coal feedstocks with zero carbon emissions.

In addition to being clean, hydrogen is a versatile energy source with applications across the transport, electricity, industrial and heating sectors. Hexagon is working with government and private sector entities to secure agreements that will accelerate the project’s pathway to production of hydrogen to meet the growth in demand in the Asia Pacific region.

What Hexagon Energy management said

Hexagon chair Charles Whitfield said the company had big ambitions in hydrogen production.

We are very excited to have finalised our acquisition of the Pedirka project. We strongly believe that Pedirka has the potential to become a regionally important producer of hydrogen that will help meet the increasing demand for carbon-neutral energy solutions in the Asia-Pacific region.

The acquisition of Pedirka is consistent with our focus on clean energy solutions and will hopefully support the conversion to hydrogen economies in the years ahead. We look forward to rapidly advancing the Pedirka Pre-Feasibility Study while also progressing our mineral assets.

Hexagon Energy share price snapshot

The Hexagon Energy share price has been one of today’s biggest movers on the ASX, but has also been rising strongly for some time.

Since the beginning of 2021, it’s nearly tripled from just over five cents per share. Overall, it’s up 52% this past week and 163% in 2021 to date.

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Motley Fool contributor Lucas Radbourne-Pugh has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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Can the Telstra Corporation Ltd (ASX: TLS) share price keep going higher? It has gone up more than 10% since 11 March 2021.

The telco has been rising as it continues to progress with its strategies.

5G

One of the main parts of the strategy is to be the market leader of 5G. This is the next phase of mobile technology that should allow for much faster speeds than we already have.

To that end, Telstra recently invested $277 million to secure 1000 MHz in the 26 GHz spectrum auction. It secured spectrum in all major capital cities and regional areas where it was sold.

The Telstra CEO Andrew Penn said that the new mmWave spectrum would “dramatically” increase capacity and speeds for Telstra customers.

Why is the mmWave spectrum so important? Mr Penn said:

mmWave spectrum is especially good at providing high-speed mobile broadband in high-density areas, such as built up cities and towns, train stations, sports stadiums and other locations with a high concentration of people using their mobile devices.

The Telstra CEO also said that the additional capacity would enable the mobile network to be used more effectively for 5G broadband in the home, providing another way to deliver fast and reliable internet where the current fixed connection may not meet a customer’s needs.

If Telstra can convince a good number of NBN customers to switch over to 5G broadband at home, then it could lead to higher margins for each home connection.

How is the profit going?

Telstra’s profit continues to decline. In the FY21 half-year result, total income decreased 10.4% to $12 billion and net profit after tax (NPAT) decreased 2.2% to $1.1 billion. Reported earnings before interest, tax, depreciation and amortisation (EBITDA) dropped 14.7% to $4.1 billion.

Competition in the mobile sector is still impacting the business, though it was able to add 80,000 retail postpaid handheld services during the period.

Cost cutting continues to be an important part to ensure the business remains as profitable and efficient as possible The T22 cost reduction target has been increased to $2.7 billion by FY22.

It’s also targeting mid to high single digit growth in underlying EBITDA in FY22 and $7.5 billion to $8.5 billion of underlying EBITDA in FY23.

One of the main ways that Telstra is helping shareholder returns is with its consistent 8 cents per share dividend every six months. That equates to a grossed-up dividend yield of 6.75%.

It’s also planning to commence the process for external investment in its InfraCo Towers division early in the first quarter of FY22. Telstra has restructured its business to create more transparency, increase focus across its operating businesses and enable long-term valuation realisation from its infrastructure businesses.

Time to jump on Telstra the share price?

Brokers are generally a fan of Telstra shares. Morgan Stanley rates Telstra as a buy with a share price target of $4 for the next 12 months.

The broker likes the restructuring of the business because each division can focus on what’s best for the segment. However, competition remains a detractor for Telstra being able to generate organic (revenue) growth.

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Telstra Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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The VanEck Vectors Video Gaming and eSports ETF (ASX: ESPO) is a relatively new addition to the ASX share market. It only launched in early September last year, after all. But this exchange-traded fund (ETF) has already made a decent start, adding more than 10% to its value since its launch.

Perhaps more tantalising for investors is the performance of the index that ESPO tracks. According to VanEck, this ETF mimics the MVIS Global Video Gaming and eSports Index. The index “comprises companies involved in video game development, eSports, and related hardware and software globally”, and evidently does so with great success, seeing as it has reportedly returned an average of 37.17% per annum over the past 5 years.

We don’t have to look too far to understand why this ETF has amassed close to $100 million in assets under management in almost 8 months. So what does this ETF really look like under the hood? Let’s take a look.

A closer look at ESPO

The Video Gaming and eSports ETF holds a relatively concentrated basket of gaming and eSports shares — 25 at the current time. The fund’s current top holding is NVIDIA Corp (NASDAQ: NVDA). NVIDIA is a popular US company that mostly designs and manufactures graphics hardware.

Other holdings that investors might be familiar with include Nintendo Co Ltd, Tencent Holdings Ltd, Activision Blizzard Inc (NASDAQ: ATVI) and Take-Two Interactive Software Inc (NASDAQ: TTWO).

Nintendo is the famous Japanese gaming company behind the gaming characters Mario, Donkey Kong, Pokemon and Zelda. It is also famous for its gaming consoles like the Wii, the old GameBoy, the Nintendo DS and the Nintendo Switch.

Tencent is the Chinese gaming behemoth that is perhaps most famous in Australia for its Fortnite game, although it owns a portfolio of popular Chinese social media and eSports apps like WeChat as well.

Activision Blizzard is the company behind some of the most popular gaming franchises in the world, like World of Warcraft and Call of Duty. Similarly, Take-Two is known for well-known franchises like Grand Theft Auto and Red Dead.

As you might have gathered, the ESPO ETF is relatively well balanced from a geographical perspective — 38.5% of its holdings are US companies, with Japan (21.1%), China (18.4%) and Singapore (6.6%) also well represented.

Finally to note, the VanEck Vectors Video Gaming and eSports ETF charges a management fee of 0.55%. That would equate to $5.50 per year for every $1,000 invested.

More reading

• 2 exciting ETFs ASX investors need to know about
• A red-hot reason why NVIDIA’s blockbuster growth is here to stay
• Got money to invest? Here are 2 ASX shares to buy
• 2 outstanding tech ETFs for ASX investors to buy this month

Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Activision Blizzard and NVIDIA. The Motley Fool Australia has recommended Activision Blizzard and NVIDIA. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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