A year later, the Metaverse rampage has yet to turn a profit

A year later, the Metaverse rampage has yet to turn a profit

In the year since Mark Zuckerberg unveiled the transformation of Facebook Inc. Billions of dollars to develop an immersive virtual world…

In the year since then Mark Zuckerberg a statement Facebook Multibillion-dollar Inc. has turned to developing an immersive virtual world, the investment industry has launched a flood of products to take advantage of the craze of the metaverse. For investors, the timing couldn’t be worse.

The fourteen exchange-traded funds and mutual funds in Bloomberg The database containing a word The “metaverse” in their description – many of them have been introduced in the past 12 months – have fallen into a bear market. The Roundhill Ball Metaverse ETF, the largest, is down 51% in the past year.

Drops accelerated Thursday after Zuckerberg shares were renamed meta pads The largest company in eight months. The CEO and co-founder asked investors to be patient with massive investments in the metaverse even as the company reported a slowdown in its main source of income, digital advertising.

“It’s one thing to rebrand, it’s another to say, OK, we haven’t seen significant profits from the metaverse” for years, said Dennis Dick, head of market structure and private trader at Bright Trading. Investors in this market will not wait eight years to see big profits.

performance metaverse Money shows the risk of accumulating in an unproven industry no matter what price you pay: companies seen as the building blocks metaverse Digital worlds where users can socialize, play and do business are just the kind of stock that investors are now scrambling to. Many of them have little or no profits and sell for high valuations, with the promise of rapid growth and big profits in the distant future.

The 18 funds that have been around for a year or more are down 33% to 66% in the past 12 months. Some stocks popular with funds took an equal hit: Meta is down 69% as of Thursday’s close, while gaming company Roblox Corp and graphics chip maker Roblox Corp is down 42%. nvidia Company fell 46%.

Large companies in the fund industry are still launching products, along with marketing materials to explain the sector. Allianz Global Investors introduced the fund just last week, while Legal & General Group Plc and Invesco Ltd. So too over the past few months.

The metaverse is still an idea as much as it is a real product for many companies. But the dramatic change in the market environment means that most investors lack the guts to make long-term bets and are looking for companies with steady growth rates and tangible profits.

Even bulls consider the metaverse a long-term bet. It’s still “very early roles,” said Matthew Kanterman, director of research at Ball Metaverse Research Partners.

For Meta, changing its name and “going into everything and investing the amount they’re investing in it today” is a big commitment because the return may not come in for 10 to 15 years, Kanterman said. This is a “significantly two to three times longer investment cycle than the average cycle for any new product.”

Technical chart for today

Poor forecast led by Amazon.com Inc. to a 12% sell-off in the e-commerce giant’s shares. Its market value briefly fell below $1 trillion after the company forecast the slowest quarterly growth in its history, while sales in its critical web services business didn’t beat estimates. There are only three other companies in the elite list we Companies worth over $1 trillion: apple a company , Microsoft Corporation. And the the alphabet a company

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