Global X Video Games & Esports ETF

HERO

Market cap $64.5M

New Chinese AI Model Kimi K3 is raising questions for established players. Investors are questioning whether AI industry still has pricing power.

Digital entertainment has grown into one of the largest discretionary categories for consumers, and it continues to draw more time and attention every year.

AI in the video gaming industry could cut development costs by 50%, unlocking $22B in profits, lifting ETF plays like ESPO and HERO.

HERO ETF offers investors an opportunity to benefit from companies in the video game industry. The prospects of the industry are improving thanks to the structural changes and the in-game monetization approach. I am rating HERO with a Buy rating, as the market is expected to see a favorable tailwind from cloud gaming, artificial intelligence, and AR/VR technologies.

It may not be the end of the quarter yet, but we have made it through summer, and that seems like a good checkpoint to evaluate the top ETF investment themes YTD. Let's take a moment to look in this year's thematic ETF rearview mirror.

HERO is a hold due to its inability to capture high-growth, innovative, and paradigm-shifting gaming companies, lagging behind peers like ESPO. The ETF's top holdings—Electronic Arts, Nintendo, and Konami—demonstrate weak growth, minimal innovation, and a lack of transformative breakthroughs. HERO's performance, high fees, and low dividend yield make it less attractive compared to peer gaming ETFs, especially ESPO.

The company recently posted 21% year-over-year revenue growth to $1.1 billion.

Some of the top-performing themes of this year totally make sense given current geopolitical and macro headwinds. Those include gold, defense, uranium and nuclear.

URA, CRPT and ARKW and others soar in the second quarter of 2025 as tech, crypto, and uranium sectors lead a stunning market rebound from April's slump.

The S&P 500 wipes out all its losses and returns to positive territory. We highlight the five best ETFs of this year.