The firesale begins. Top searches in the gaming sector are Playstation 5, Xbox Series X, and GPUs, so best of luck to all of you out there on the hunt. Most gamers will be familiar with the companies manufacturing these products, but should you buy shares in them?
To spend or to invest
I’m not suggesting that anyone throws every dime they earn into the market but let’s look at how the top-selling game console stocks have performed over the last five years to give you an idea of whether they could be a good investment:
Top of the list is Nvidia (NASDAQ: NVDA). The tech giant is involved in many sectors including professional visualization, data centers, autonomous driving, and now the metaverse. However, Nvidia’s primary business has been, and still is, gaming; and it’s been that way for over twenty years.
Nvidia’s popular RTX 3080 GPU is currently retailing at $699 (you’ll be lucky to get it at that price now), but what would that have earned you in the last five years, had you invested in its shares?
Nvidia is up over 1,290% in that period, so including the initial investment, that $699 would now be worth a whopping $9,715.
Everyone knows Microsoft’s (NASDAQ: MSFT) products; most of us interact with them on a daily basis at work, but it also produces the Xbox, one of the most popular gaming consoles of all time. The latest Xbox Series X is going for around $499 in the U.S. right now — that same figure invested in Microsoft five years ago would now be worth $2,789; nothing to turn your nose up at either.
Last but not least; well actually it was the worst-performing of the bunch. But Sony (NYSE: SONY) products have been at the heart of our homes for years, with mass-produced televisions, cameras, speakers, and bundles of other tech accessories. Sony shares were still up over 300% on a five-year time horizon, so taking its $499 price tag for the Playstation 5, your investment would have netted you over $1500, on top of the amount originally invested.
It can be a great idea to create a healthy balance between your spending and investing. The above showcases the benefits of doing so, and if you yourself are a gamer, it gives you the inside knowledge to know who’s making the best products now, and who will be the one’s making the best products in 5-10 years time too.
One of the principles we follow at MyWallSt is investing via your circle of competence, so make sure to make use of it on your investing journey.
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Financial Writer at MyWallSt
David's favorite stock is Google. He's a daily user of its YouTube platform, where you can learn or find something brand new at the touch of a button. He believes the company will continue to grow for many years to come.