Gain Metaverse Exposure: The 4 Best Metaverse ETFs to Buy in 2022

Gain Metaverse Exposure: The 4 Best Metaverse ETFs to Buy in 2022

Expose your portfolio to some otherworldly gains with the best metaverse ETFs, including METV, MESH, PUNK and MTAV.

Gain Metaverse Exposure: The 4 Best Metaverse ETFs to Buy in 2022
Darry Port

Published Feb 16, 2022Updated Aug 9, 2022

Stock Trading

Stock Trading

Metaverse

Metaverse

Crypto

Crypto

As little as 3 months ago, you probably never even heard the word metaverse. But November 2021 was something of a metaverse coming out party for Big Tech. 

First Facebook rebranded to Meta Platforms and walked us through Zuckerberg’s version of a Black Mirror episode. Microsoft soon followed by showcasing their Mesh platform and outlining plans to bring Teams to the metaverse. Nvidia, not to be outdone, unveiled Omniverse — a 3D modeling and simulation platform targeting the world’s 40 million 3D designers. 

The Metaverse is here to stay. So the only question that remains is, how do we profit off the billions of dollars that are being poured into this space? The short answer to that is metaverse ETFs. 

On the one hand, I can spoon-feed you a list of metaverse ETFs and blabber on about Web3, Non-Fungible Tokens (NFTs), Extended Reality (XR) and the Internet of Senses until you start begging me to unplug your headjack from the Matrix. 

But what say we hold our virtual horses and define what metaverse ETFs are first. That way, you can judge each entrant on the list for yourself.

What is a metaverse ETF?

An ETF or exchange-traded fund is a type of stock that pools together multiple investments. So, rather than having to buy one asset (e.g. stock, commodity, bonds) at a time, ETFs allow investors to gain exposure to a basket of assets under one roof. ETFs can be categorized according to a number of features:

Active vs Passive: Whether its holdings are manually allocated or it automatically tracks an index.

International vs Regional: ETFs can have holdings that are worldwide or limited to single countries, like a US-only ETF. 

Single vs Multi asset: Some ETFs only focus on one asset, e.g. a bond ETF for fixed income. Others combine the relative advantages of multiple asset classes, like stocks for growth and bonds for income. 

Sector/Industry vs Entire market: ETFs like VOO and SPY track the 500 largest companies in the U.S., which account for most of the stock market’s performance. On the flipside, we have ETFs that focus on a group of stocks in an overarching field or trend, like the metaverse ETFs we’re discussing today. 

Understanding metaverse ETFs

The metaverse is an immersive, 3D virtual environment that is set to transform society as the generation of the internet. And several research firms are backing up this claim: Both Brandessence and Reports and Data expect the metaverse industry to be worth north of $500 billion to $800 billion by 2028. With all these billions up for grabs, large and small tech players are trying to cash in on the trend. 

But since the market is still young, we have no idea which companies are going to end up dominating. That’s where Metaverse ETFs come in. A Metaverse ETF is a stock that lets you invest in a number of promising metaverse companies in one fell swoop. Metaverse ETFs have been booming in the US, Canada and especially South Korea as of late. As of January, over $1 billion has already flowed into South Korean metaverse ETFs which include K-pop stocks among their top holdings. 

But before you FOMO into metaverse ETFs keep these key risks in mind:

  • Fees: Actively managed ETFs have higher fees (i.e. Expense ratios) than passive ETFs.
  • Diversification: Going in heavy on single-industry ETFs limits diversification.
  • Liquidity: Investing in small-cap ETFs can limit your ability to sell them later on.
  • Trendiness: Do your research on the metaverse first to avoid chasing a fad.

Top 4 metaverse ETFs in 2022

This list is by no means exhaustive, as a ton of new metaverse ETFs are expected in the coming months. Funds like First Trust and ProShares and Simplify ETFs are just a few examples that have already filed to launch Web3 and metaverse ETFs in the US and abroad. 

Additionally, since all of these ETFs aren’t even a year old yet we can’t really analyze their performances. But if you’re still itching for a fix like Rue in Euphoria, here are some of the best metaverse ETFs for the coming year.

Roundhill Ball Metaverse ETF (METV)

Key facts:

  • Ticker: METV
  • Availability: U.S.-based
  • Regional Exposure: US, Asia
  • Primary Exchange: NYSE Arca
  • Management Style: Passively managed
  • Expense Ratio: 0.59%
  • Assets Under Management (AUM): $832 million
  • Inception date: June 30, 2021
  • Holdings: 45
  • Share Price: $12.43 (as of 2/14/22)

Roundhill Investments has a number of metaverse firsts under their belt. For starters, they designed the Ball Metaverse Index, which is the first global index that tracks the performance of the Metaverse. Next they came out with the METV, which is the first metaverse ETF to launch in the US. The METV tracks the Ball Metaverse Index, a weighted portfolio of 40 businesses across the US (80%) and Asia (20%) that provide hardware, virtual platforms, content, payments infrastructure and more. METV is one of the most widely available ETFs on this list. You can find it on Robinhood, TD Ameritrade, Interactive Brokers, Public and more. 

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Robinhood

4.3

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Top 10 Holdings (as of February 14, 2022)

  1. Nvidia Corporation (NVDA): 8.42%
  2. Microsoft Corp (MSFT): 7.16%
  3. Meta Platforms Inc (FB): 6.36%
  4. Roblox Corp (RBLX): 5.97%
  5. Unity Software Inc (U): 5.20%
  6. Snap Inc (SNAP): 4.97%
  7. Taiwan Semiconductor Mfg Ltd Sponsored Ads (TSM): 4.40%
  8. Apple Inc (AAPL): 4.32%
  9. Amazon.com INc (AMZN): 4.09%
  10. Qualcomm Inc (QCOM): 3.70%

Evolve Metaverse ETF (MESH)

Key facts:

  • Ticker: MESH
  • Availability: Canada-based
  • Regional Exposure: North America, Asia
  • Primary Exchange: Toronto Stock Exchange (TSX)
  • Management Style: Actively managed
  • Expense Ratio: 0.60%
  • Assets Under Management (AUM): $13.1 million
  • Inception date: November 24, 2021
  • # of Holdings: 25
  • Share Price: $8.45 (as of February 14, 2022)

MESH distinguishes itself by being the first metaverse ETF to launch in Canada, in addition to being actively managed. Out of the 25 stocks it holds, 74% belong to the US, while the remaining 24% is made up of companies in China, Japan, Taiwan and Singapore. Unlike METV, MESH’s holdings are almost equally weighted at around 4%.

 Top 10 Holdings (as of February 14, 2022)

  1. Activision Blizzard Inc (ATVI): 5.95%
  2. Tencent Holdings Ltd (TCEHY): 4.68%
  3. NetEase Inc (NTES): 4.68%
  4. Electronic Arts Inc (EA): 4.68%
  5. Taiwan Semiconductor Manufacturing Co Ltd (TSM): 4.62%
  6. The Walt Disney Company (DIS): 4.54%
  7. Alibaba Group Holding Ltd (BABA) 4.48%
  8. Apple Inc (AAPL): 4.42%
  9. Alphabet Inc (GOOGL): 4.22%
  10. Intel Corp (INTC) 4.21%

We know we Zucked-up

We know we Zucked-up

Are Meta's intentions good?

Subversive Metaverse ETF (PUNK)

Key facts:

  • Ticker: PUNK
  • Availability: U.S.-based
  • Regional Exposure: North America, Europe, Asia
  • Primary Exchange: Cboe BZX Exchange
  • Management Style: Actively managed
  • Expense Ratio: 0.75%
  • Assets Under Management (AUM): $1.31 million
  • Inception date: January 27, 2022
  • # of Holdings: 55-65
  • Share Price: $27.17 (as of February 15, 2022)

 

Subversive Capital’s PUNK is the newest entrant on this list. PUNK is an actively managed portfolio that selects companies in one of seven layers of the Metaverse, namely: 

  1. Experience: E.g. Games, social networking, eSports, shopping
  2. Discovery: E.g. Ad networks, search
  3. Creator Economy: e.g. No-Code tools and marketplaces
  4. Spatial Computing: E.g. 3D engines, voice and gesture recognition
  5. Decentralization: E.g. Cryptocurrencies, NFTs
  6. Human interface: E.g. Virtual reality (VR), Augmented Reality (AR), Mixed reality (MR)
  7. Infrastructure: E.g. 5G, WIFI, cloud, and semiconductors 

Once identified, the fund will rank each company based on their commitment to developing the metaverse. Staying true to its parent company’s name, PUNK is betting on Meta Platforms’ downfall by shorting it — which is the polar opposite of what every other metaverse ETF is doing.  PUNK’s portfolio manager expressed that he doesn’t want the metaverse to get ‘Zucked-up’ by the company formerly known as Facebook. Hey, that makes 2 billion of us. 

Top 10 Holdings

  1. Roblox Corp (RBLX): 4.06%
  2. Coinbase Global Inc (COIN): 3.85%
  3. Nvidia Corporation (NVDA): 3.79%
  4. Cash (3.74%)
  5. Sony Group Corporation (SONY): 3.18%
  6. Cloudflare Inc (NET): 3.15%
  7. Microsoft Corp (MSFT): 2.83%
  8. Alphabet Inc (GOOGL): 2.81%
  9. Block Inc (SQ): 2.77%
  10. Agilent Technologies Inc (A): 2.76%

Horizons Global Metaverse Index ETF (MTAV)

Key facts:

  • Ticker: MTAV
  • Availability: Canada-based
  • Regional Exposure: Americas, Europe, Asia
  • Primary Exchange: Toronto Stock Exchange
  • Management Style: Passively managed
  • Expense Ratio: 0.55%
  • Assets Under Management (AUM): N/A
  • Inception date: November 26, 2021
  • # of Holdings: 50
  • Share Price: $22.21 (as of February 15, 2022)

Finally, we have the Horizons Global Metaverse ETF, which is designed to track the performance of the Solactive Global Metaverse Index. Of the ETFs on this list, MTAV is one of the most diversified beyond Big Tech into payments, ecommerce and media. In terms of weighing, MTAV sizes each stock by its market capitalization while trying not to let any exceed 5%. 

Top 10 Holdings

  1. Apple Inc (AAPL) 6.83%
  2. Visa Inc (V): 6.32%
  3. Mastercard Inc (MA): 5.96%
  4. Tencent Holdings Ltd (TCEHY): 5.55%
  5. Alphabet Inc (GOOGL): 5.5%
  6. The Walt Disney Company (DIS): 5.34%
  7. Microsoft Corp (MSFT): 5.28%
  8. Nvidia Corp (NVDA): 5.23%
  9. Amazon.com Inc (AMZN): 5.2%
  10. Alibaba Group Holding Ltd (BABA): 4.47%

Best metaverse ETFs at a glance

Roundhill Ball Metaverse ETF (METV)

Evolve Metaverse ETF (MESH)

Subversive Metaverse ETF (PUNK)

Horizons Global Metaverse Index ETF (MTAV)

Share Price

$8.46

$6.17

$18.70

$17.75

Expense Ratio

0.59%

0.60%

0.75%

0.61%

Management Style

Passive

Active

Active

Passive

AUM

$548.76M

$9.870 M

$993.12K

$4.2 M

# of Holdings

45

28

56

50

Data accurate as of June 10, 2022