This sports ETF wants to score for your portfolio

2 Mins read

Sports and stocks go hand in hand.
Wall Street residents often talk about slam-dunk investments and describe the economic cycle as a particular inning.

So, it makes perfect sense that there’s an ETF dedicated to the business of sports.

The pro sports Sponsors’ exchange-traded fund, which has the ticker symbol FANZ (FANZ), invests in companies dealing with the four major US team sports leagues.

Nick Fullerton, CEO of SportsETFs, the company behind the fund, said it was set up last year to take advantage of the popularity of team sports, which bring in big dollars.

Legal gambling, spread across the United States, could boost that popularity even more.

New ETF Will Let Individual Investors Bet On The Business Of Sports

Fullerton pointed out that the FANZ ETF companies must have an actual sponsorship with a major league, not just a naming rights deal on a stadium.

No CMGIs or Enrons here.

“These are blue-chip companies with strong balance sheets and cash flow,” Fullerton said.

The ETF also spreads out its investments and makes no huge bets.

Most of the holdings account for roughly 1% and 2% of the fund’s assets. In other words, it has a deep bench and not just one or two superstars.

The fund owns all the names you’d expect for something with a sports theme.

Coca-Cola (KO) and Gatorade owner Pepsi (PEP) are in. So are beer giants Anheuser-Busch InBev (BUD) and Molson Coors (TAP). Ditto for sneaker kings Nike (NKE) and Under Armour (UA).

Look more closely at the fund’s holdings, and you’ll find some companies that don’t seem to fit, such as hair salon owner Regis (RGS), trucking company Old Dominion Freight Line (ODFL), and a little outfit from Seattle named Amazon (AMZN).

But Fullerton explains that Regis is in the ETF because its Supercuts subsidiary is the official hair salon of Major League Baseball.

Similarly, Old Dominion is the official freight carrier of MLB.

And Amazon’s AWS cloud unit is baseball’s official machine learning and artificial intelligence data provider.

That makes sense, given how obsessed people have become with launch angles and exit velocity lately.

DraftKings CEO: Legal sports betting will bring innovation
DraftKings CEO: Legal sports betting will bring innovation
Much like professional sports, the market is about what you have done for me lately. So, how is this relatively new fund doing?

The FANZ ETF is up 4% this year and nearly 13% over the past 12 months, slightly below the returns for the S&P 500.

Fullerton isn’t too concerned. He says he does not think declining TV viewership for some sports is a problem. He argues that Millennials are still viewing sports content. It just might be through shorter videos as opposed to full games. Fantasy sports provide another avenue for eyeballs.

“People are still catching highlights and snippets through mobile and other mediums, and they still see a lot of the branding,” Fullerton said, arguing that many companies in the ETF have digital ads as well as key placement of their brands in stadiums.

And if this ETF winds up being a financial touchdown, goal, home run, or other sports success metaphor of your choosing, then there could be more sports ETFs in the future. ETFs tied to golf, soccer, NASCAR, and even e-sports are possibilities.

“There are so many different ways to slice and dice the business of sports,” Fullerton said.

680 posts

About author
Introvert. Incurable tv guru. Internet lover. Twitter trailblazer. Infuriatingly humble communicator. Spent a weekend creating marketing channels for cod in New York, NY. Spent the 80's writing about fried chicken in Pensacola, FL. In 2009 I was investing in sock monkeys in the government sector. Spent high school summers exporting cannibalism in Deltona, FL. A real dynamo when it comes to donating Roombas in Miami, FL. Spent 2001-2005 supervising the production of acne for no pay.
Related posts

Solon initiates creation of Department of Sports

2 Mins read
The Philippines must act speedily to keep its athletes from searching for non-public and foreign aid using developing a Department of Sports,…

European Sports Championships: launch of new spectacle of sport

3 Mins read
A neat trick regarding a sleight of hand is set to be performed in front of our eyes, and the illusionists accept…

Windsor/Stewardson-Strasburg sports co-op reaches new agreement

2 Mins read
When the Stewardson-Strasburg School Board voted four-3 no longer to renew its sports activities co-op with Windsor on May 30, it appeared…