The post Best Sports Betting Stocks by Joshua Enomoto appeared first on Benzinga. Visit Benzinga to get more great content like this.
Though an industry whose heritage extends back to the dawn of civilization, wagering on sports carried significant controversies due to their association with organized crime. Further, the advent of the internet and mobile connectivity technologies allowed illegal bookies to run sports betting operations that skirted taxation laws. That’s why it’s important to know about the best sports betting stocks when investing.
However, thanks to a pivotal court case in New Jersey in May 2018, any state that wants to legalize sports betting can do so. As a result, several states decided to allow such activities, representing a massive boon for sports betting stocks. Below are five of the most compelling ideas.
Best Sports Betting Stocks Right Now
Gainers
| Symbol | Open | Close | Change | Change % | Volume |
|---|---|---|---|---|---|
|
Buy DKNG Stock – DKNG DraftKings |
30.69 | 30.72 | 0.03 |
0.09% |
6.95M |
|
Buy CHDN Stock – CHDN Churchill Downs |
118.05 | 118.15 | 0.10 |
0.08% |
25.76K |
Losers
| Symbol | Open | Close | Change | Change % | Volume |
|---|---|---|---|---|---|
|
Buy CZR Stock – CZR Caesars Entertainment |
53.82 | 52.36 | -1.47 |
-2.73% |
1.66M |
|
Buy FUBO Stock – FUBO FuboTV |
2.55 | 2.49 | -0.07 |
-2.55% |
10.67M |
|
Buy PENN Stock – PENN PENN Entertainment |
21.77 | 21.45 | -0.32 |
-1.47% |
2.49M |
|
Buy MGM Stock – MGM MGM Resorts Intl |
41.99 | 41.45 | -0.55 |
-1.30% |
3.89M |
|
Buy BETZ Stock – BETZ Roundhill Sports Betting & iGaming ETF |
17.14 | 16.99 | -0.15 |
-0.86% |
16.61K |
|
Buy FLTR Stock – FLTR VanEck IG Floating Rate ETF Trading under the new Product Name to begin at the market open on September 13, 2022. |
25.25 | 25.23 | -0.03 |
-0.10% |
28.19K |
Table of contents
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Understanding Sports Betting Stocks
Similar to the North American cannabis industry, the best sports betting stocks represented untapped potential. According to the Las Vegas Convention and Visitors Authority, between 2014 through 2019, more than 40 million tourists descended upon “Sin City,” racking up massive revenue throughout the area’s gaming and convention business. In other words, if wagering on sports were legal, governing jurisdictions could enjoy an incredible (and taxable) revenue stream.
Unfortunately, prior to U.S. legislation favorable to sports betting stocks, criminal elements used the platform to launder money. In 2014, a Reuters report detailed how nefarious organizations attempted to fix certain games. As a result, only lawbreakers benefitted from their racket. In the meantime, several state budgets became stretched to the limit while critical public services went unaddressed. However, the U.S. Supreme Court in 2018 struck down a federal ban on sports betting, allowing individual states to make their decisions.
On principle, legalization makes sense because, as a now taxable enterprise, sports betting operations will draw more eyes and regulatory guidance. Theoretically, this should dissuade funny business due to the increased chances of getting caught. Better yet, the legalized gaming industry will likely provide job growth — an area where the country still needs to recover. For instance, the national employment level is still down roughly 5% from right before the pandemic.
Just as importantly, advanced technologies helped navigate the best sports betting stocks through a difficult time last year. When the COVID-19 pandemic initially disrupted the global economy, questions lingered over the viability of athletic competition. But thanks to mitigation protocols and mobile gaming apps stepping up to the plate, the sports gambling market became one of the biggest winners in the equities space.
Best Online Brokers for Sports Betting Stocks
As stock trading on margin data from the Financial Industry Regulatory Authority (FINRA) confirms, speculation is rampant in the American consumer market. An underlying cause of this gambling behavior could be “retail revenge.” An offshoot of retail therapy, this concept describes people who are making up for the time that the COVID-19 crisis cost them through increased spending.
However, this sentiment lift doesn’t just revolve around physical products but also services. Therefore, it’s possible that investor demand for sports betting stocks will increase in the months ahead. If so, you should prepare yourself to profit from this narrative by investigating both individual stocks and brokerages that cater to this market segment.
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get started
securely through CenterPoint Securities’s
website
CenterPoint Securities is ideal for active traders who demand access to advanced tools and services. While investors and casual traders are likely to be content with the basic offerings of traditional online brokerages, active traders will benefit from CenterPoint’s suite of advanced trading tools. If you value execution quality, access to short inventory, advanced trading platforms, and accessible customer service, CenterPoint is an excellent choice.
Best For
- Intermediate to Advanced traders
- High-volume traders
- Momentum traders
- Short sellers
- Unrivaled access to short inventory
- Flexible order routing for improved executions
- Discounts for active traders
- Advanced platform with fast executions
- Reliable customer service
- Not designed for beginner or low-volume traders
get started
securely through Interactive Broker Primary’s
website
Interactive Brokers is a comprehensive trading platform that gives you access to a massive range of securities at affordable prices. You can buy assets from all around the world from the comfort of your home or office with access to over 150 global markets. Options, futures, forex and fund trading are also available, and most traders won’t pay a commission on any purchase or sale.
IBKR is geared primarily toward experienced traders and investors but now with the availability of free trades with IBKR Lite, casual traders can also acclimate to IBKR’s offerings.
Best For
- Access to international markets
- Active traders
- Detailed mobile app that makes trading simple
- Wide range of available account types and tradeable assets
- IB SmartRouting provides significant price improvement vs. industry
- Fractional trading allows investing regardless of share price
- Industry’s lowest margin rates
- Earn more by lending your fuly-paid shares
- Beginner investors might prefer a broker that offers a bit more hand-holding and educational resources
Get 10 Free Shares
securely through Magnifi’s
website
Magnifi is an intelligently designed marketplace that allows investors to access data-backed information about various investment opportunities. The company combines standard brokerage tools with artificial intelligence (AI) to promote financial competence. Magnifi distinguishes itself from the crowd by offering an AI-powered search feature and an AI-powered investment assistant. Magnifi offers a technology-forward platform that aims to promote confident and capable long-term financial investments.
Best For
- Long-term investors
- Individuals interested in personalized assistance
- New investors that are eager to learn how to start investing
- Access to an AI-powered investing assistant with a Magnifi Personal account
- Commission-free investing
- Over 15,000 possible investments
- Available mobile application
- Limited methods of communication with customer service
get started
securely through Webull’s
website
Webull, founded in 2017, is a mobile app-based brokerage that features commission-free stock and exchange-traded fund (ETF) trading. It’s regulated by the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).
Webull offers active traders technical indicators, economic calendars, ratings from research agencies, margin trading and short-selling. Webull’s trading platform is designed for intermediate and experienced traders, although beginning traders can also benefit.
Webull is widely considered one of the best Robinhood alternatives.
Best For
- Active traders
- Intermediate traders
- Advanced traders
- No account maintenance fees or software platform fees
- No charges to open and maintain an account
- Intuitive trading platform with technical and fundamental analysis tools
- Does not support trading in mutual funds, bonds or OTC stocks
get started
securely through TD Ameritrade’s
website
This publicly listed discount broker, which is in existence for over four decades, is service-intensive, offering intuitive and powerful investment tools. Especially, with equity investing, a flat fee is charged, with the firm claiming that it charges no trade minimum, no data fees, and no platform fees. Though it is pricier than many other discount brokers, what tilts the scales in its favor is its well-rounded service offerings and the quality and value it offers its clients.
Best For
- Novice investors
- Retirement savers
- Day traders
- World-class trading platforms
- Detailed research reports and Education Center
- Assets ranging from stocks and ETFs to derivatives like futures and options
- Thinkorswim can be overwhelming to inexperienced traders
- Derivatives trading more costly than some competitors
- Expensive margin rates
get started
securely through Plus500’s
website
86% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.
Plus500 is a European derivatives broker focusing on contracts for difference (CFDs). CFDs are similar to binary options in the U.S. where traders take all-or-nothing speculation on the prices of certain securities like indices, commodities or currencies. While not legal to trade in the U.S., CFDs are legal in many jurisdictions across the globe and Plus500 offers a wide array of tradable markets using these instruments.
Plus500 doesn’t charge commission and only profits off the spread, which is the difference between the buy and sell price of a specific security. But Plus500 is not a broker for beginners — the education materials are sparse and CFDs are risky derivatives capable of sapping out all of an investor’s capital. Only trade these instruments if you understand how they operate and the risks involved with buying them.
Best For
- Traders looking for a smooth mobile experience
- Great mobile app
- Low spreads and commissions
- Unlimited demo account
- Only derivatives are available
- Not open to U.S. residents
Features to Look for in Sports Betting Stocks
Here is what to look for in sports betting stocks to potentially increase your profits.
Attractive Brand
Like any lucrative market, competition is fierce among these stocks. This is why it’s critical for the underlying businesses to carry attractive brands at their disposal. While consumer confidence improved substantially from the low point in April 2020, it’s still down below pre-pandemic norms. This implies that companies have to fight for a dwindled consumer base. Owning strong brands makes this job much easier.
Diversified Business
When the COVID-19 crisis first touched down in the U.S., major metropolitan areas including Las Vegas looked like ghost towns. Logically, this headwind impaired brick-and-mortar retail sportsbooks, which had to close down for several months. On the other hand, mobile operators kept the lights on. Given the uncertainties of how this pandemic will ultimately pan out, you should consider sports betting stocks tied to diversified businesses.
Strong Volume
One of the surprises that catch new investors of speculative trades off guard is that low volume can make you a loser even if you’re a winner on paper. For instance, wide bid-ask spreads suggest that you may have difficulty finding a buyer for your stock when you’re ready to sell. Therefore, make sure that your stocks have a relatively robust trading activity before you dive in.
More Than a Roll of the Dice
Sports betting has long been a part of the American fabric, though not always in a positive light. However, a groundbreaking legal ruling gave sports betting stocks much needed legitimacy. It also brings more regulatory oversight to the industry, which should help clean out corrupt activities.
Moving toward the horizon, the sports gambling segment provides investors with an intriguing setup. Primarily, consumers are hungry for normalcy and sports betting provides a form of retail therapy. Moreover, excitement brews over the return of full-sized crowds, which augurs well for the best stocks in this space.
Frequently Asked Questions
Is sports betting legal?
Sports betting is legal in all states in the U.S if the state choses to allow it. Since 2018, several states have.
Answer Link
What are the best sports betting stocks?
Benzinga provides a list of the best sports betting stocks above.
Answer Link
Are any sports betting companies public?
Yes, there are several sports betting companies that are publicly traded. Some examples include DraftKings, Flutter Entertainment (owner of FanDuel), and William Hill. These companies have gone public and are listed on stock exchanges, allowing investors to buy and sell shares in them.
Answer Link
The post Best Sports Betting Stocks by Joshua Enomoto appeared first on Benzinga. Visit Benzinga to get more great content like this.