Even Wall Streeters want to gamble on gambling stocks without rolling the dice, a fact that GamingToday founder, the late Chuck Di Rocco, underscored in the early 1990’s when he scheduled the first gaming stock seminar during the Gaming Expo at the Las Vegas Convention Center.
At that session, hosted by PBS’ Paul Kangas, Di Rocco attracted some of the biggest names in the investment community to give their opinions of the various gaming companies and their relative values. Attendees packed the room.
Today, the new gimmick among investors is the "ETF," or exchange traded funds. Last week, the latest ETF emerged from the Van Eck Global group that announced it had started the S-Network Global Gaming Index that would trade on the American Stock Exchange with the symbol "BJK."
Van Eck Global says it has most of the industry’s major performers among its 69 stocks including MGM MIRAGE Inc. (MGM), Las Vegas Sands Corp. (LVS) and International Game Technology (IGT). In fact, it says IGT shares represent 9.9% of the index holdings.
To get into the index, Van Eck explained, a company must take in 50% or more of its revenue from gambling. The index is cap-weighted and float-adjusted.
Joseph LaCorte, managing member of the S-Network Global Indexes, says the index offers substantial diversification within the industry, includes online gaming companies and has no restrictions on what country the stocks are in.
"Gaming," says LaCorte, "has come a long way from its seedy origins. It’s no longer a degenerate activity. It’s now been accepted as a leisure-time activity."
He credited Las Vegas and its varied promotions in making gaming more acceptable to the general public. Other factors, he included, was acceptance as part of the economic landscape, tighter regulation by state and local authorities, and the constraints of being a public company.
LaCorte notes that 48 states have legalized gambling, and casinos have become common on the nation’s Indian reservations.