Three stocks to help you ride the Metaverse boom
There’s no need to chase risky investments when it comes to this new technology
This article was created by MoneyWise. Postmedia and MoneyWise may earn an affiliate commission through links on this page.
You don’t have to go too far back in history for a refresher course in how stock market bubbles can leave investors with ragged holes in their portfolios.
Remember the great pot stock boom of 2018-2019? Canada’s top marijuana producers are an excellent example of how investor exuberance, absent a proven product or working marketplace, can be enough to drive the price of a company’s stock through the roof, only to have share prices come crashing down later. Avoiding irrational exuberance can be especially hard to do when a brand new industry, like the metaverse, is just starting to peek its head over the horizon.
The beauty of investing in the metaverse is that, unlike the pot or dot-com bubbles that burst in the past two decades, the companies expected to build it are established entities, not start-ups with sexy, buzzword-laden elevator pitches. Many of them are large enough that the metaverse is just one of their many projects; if this new version of the internet doesn’t get off the ground, their stock isn’t likely to wind up in the metadumpster.
It sounds an awful lot like Second Life, the once-popular video game platform where users don digital avatars and interact with their counterparts from around the world; only in the metaverse, your job will be there, too.
Launched in 2003, Second Life was a brief hit in the days before social media gave people cooler, more appealing ways to promote themselves and yell at each other, but it hasn’t been as popular since. The company’s CEO told Vice in 2020 that the platform has about 900,000 active users.
But one thing Second Life had going for it and still does to a lesser extent, is a virtual marketplace where people spend real money. In an era where online shopping has become so convenient , where people have grown accustomed to buying goods by tapping Instagram photos or TikTok videos, the metaverse is expected to have a hefty consumer component, where companies and users can buy and sell on the platform.