March Madness and Ways To Invest It
The March Madness basketball tournament is an annual event held in the United States each spring. It involves the top 68 college basketball teams from around the country, competing in a single-elimination tournament to determine the national champion. The tournament is organized by the National Collegiate Athletic Association (NCAA) and is widely considered one of the biggest and most exciting events in college sports. The tournament typically lasts for three weeks and involves a series of games played across the country, culminating in the Final Four, where the last four remaining teams compete in the national semifinals and finals to determine the champion.
While there are no guarantees in the stock market, some companies that may benefit from the March Madness tournament include:
- DraftKings Inc. (DKNG): As a leading provider of online sports betting and daily fantasy sports, DraftKings could see increased activity during the tournament. DraftKings is currently #2 in US Market Share for online Sports Betting.
- FanDuel Group (FLTR-LN): FanDuel is currently #1 in US Market Share for online Sports Betting. Similar to DraftKings, FanDuel is a popular provider of online sports betting and daily fantasy sports that could benefit from increased activity during the tournament. You can access FanDuel via its parent listing FLTR LN, the company is exploring a US spinoff listing for FanDuel in 2023.
- MGM Resorts International (MGM): MGM Resorts owns several casinos and sportsbooks in the U.S. and could see increased revenue from sports betting activity during the tournament.
- Caesars Entertainment, Inc. (CZR): As another major casino and sportsbook operator, Caesars Entertainment could also benefit from increased sports betting activity during the tournament.
- Buffalo Wild Wings (BWLD): As a popular sports bar and restaurant chain, Buffalo Wild Wings could see increased foot traffic during the tournament as fans gather to watch games.
- Coca-Cola Company (KO): As a major sponsor of the NCAA tournament, Coca-Cola could benefit from increased visibility and brand recognition during the event.
- Nike Inc. (NKE): As a major sponsor of several college basketball teams, Nike could benefit from increased visibility and brand recognition during the tournament.
Want to diversify from single stock risk? Here a few ETFs with large holdings in the above companies:
- iBET Sports Betting and Gaming ETF (IBET): This fund is involved in everything sports betting and gaming putting its top holdings in companies such as FanDuel parent, Flutter Entertainment as well as DraftKings, MGM Resorts, and Churchill Downs Inc. Year to date the iBET ETF is up nearly 14%. Last year March Madness served as a catalyst for the fund as this stock appreciated 6-7% in March 2022.
- iShares U.S. Consumer Services ETF (IYC): This ETF invests in U.S. companies that provide consumer services, including Buffalo Wild Wings, Coca-Cola Company, and Nike Inc. YTD the fund is up 10.38%.
- Fidelity MSCI Consumer Discretionary Index ETF (FDIS): This index is designed to measure the performance of large, mid, and small-cap companies in the consumer discretionary sector in the United States. This ETF tracks the performance of companies like Nike Inc. and Buffalo Wild Wings.
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