BlackRock Inc (NYSE:BLK), the world’s largest asset manager, is offering an exchange-traded fund (ETF) that will focus primarily on tech companies that are exposed to the metaverse.
The investment giant’s iShares Future Metaverse Tech and Communications ETF (IVRS) will invest in companies that are expected to dominate the metaverse in areas including virtual platforms, social media, gaming, 3D software, digital assets, and virtual and augmented reality.
Some of the high-profile companies that are included in the holdings are Meta Platforms, Apple Inc (NASDAQ:AAPL), Nvidia, Netease and Roblox.
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At this stage, the Blackrock ETF will primarily focus on equities, and has a net asset value of around $5 million and trades on the New York Stock Exchange.
A leap into the metaverse
While interest rate fears continue to drive volatility in technology shares, BlackRock remains confident in the long-term value available across the sector and the potential presented by the metaverse.
“The metaverse is an immersive virtual world built on established gaming, virtual reality and augmented reality elements,” Reid Menge, co-portfolio manager of the BlackRock Technology Opportunities Fund said in a blog post.
“At this juncture, it is much like the internet of the early 1990s or the smartphone of the early 2000s: We expect it is going to be big, and very likely change people's daily lives. But we don't yet know exactly how, or how big the shift will be. What we do know: Work and play will be affected.”
Tech giants like Microsoft and Meta have invested heavily in the metaverse during the bull run, but their funding of virtual social spaces has slowed amid a crypto winter. Mark Zuckerberg’s metaverse business lost more than $10 billion in 2021 alone, and the losses have only snowballed. Meta said its Reality Labs division, home to the company’s virtual reality technologies and projects, posted a $13.72 billion operating loss in 2022.
Contact the author Uttara Choudhury at uttara@proactiveinvestors.com
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