Published On: Sun, Jun 10th, 2018

World Cup meets investing: Swissquote launches Football Fever Certificate

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Taking an interesting twist on sports investing, Switzerland based online trading group Swissquote Group Holding SA (SWX:SQN) has launched a Football Fever Certificate, allowing investors access to a basket of listed companies comprised of World Cup sponsors and European football clubs.

The Football Fever Certificate can be traded on the Swiss stock exchange (SIX), under the symbol SQFFEU.

Nothing brings the world together quite like the World Cup. However football doesn’t just get national passions boiling – it is also big business. Football is a multi-billion-dollar global industry, and the sports industry as a whole is outpacing GDP growth in both emerging and mature economies. According to FIFA’s financial report, the Russia World Cup is expected to generate USD $ 5.2 billion in revenue, 8% higher than the $ 4.8 billion generated by the 2014 World Cup. Forecasts for Qatar 2022 project revenue as high as $ 6.5 billion. Television revenue is also increasing sharply: broadcasters paid over $ 8 billion for the 2016-2019 rights to the English Premier League, almost twice as much as three years prior.

Investing in football shares is a very risky business, since it is highly dependent on on-the-pitch results and consumer habits. However, it has proved less cyclical than other available forms of entertainment. Returns on investment can be high. In 2014, when Benfica Lisbon reached the Europa League final, the club’s stock price tripled. That same year, Borussia Dortmund’s stock price surged when the club reached the Champions’ League quarter-finals. The World Cup historically serves to reinvigorate the sport, driving renewed interest in league and recreational football alike. This boosts both immediate and residual revenue for companies involved in the global football industry.

Swissquote’s Football Fever theme will initially invest in European clubs and sponsors the company deems likely to benefit from the immediate euphoria (and heavy marketing spend by these companies) surrounding the World Cup. For loyal fans, global sponsorship is a critical purchasing criterion. Football fans are particularly likely to purchase goods and services from companies sponsoring their favorite national and club teams.

Swissquote’s Football Fever Certificate includes shares in the following companies:

Name Symbol Currency Weight
COCA-COLA ORD KO USD 12%
MCDONALD’S ORD MCD USD 11%
NCHESTER UNITED CL A ORD MANU USD 10%
ELECTRONIC ARTS ORD EA USD 9%
JUVENTUS FOOTBAL CLUB ORD JUVE EUR 9%
ADIDAS N ORD ADS EUR 8%
China Mengniu Dairy 2319 HKD 8%
A.S. ROMA ORD RO9 EUR 8%
PARKEN ORD PARKEN DKK 7%
BORUSSIA DORTMUND ORD BVB EUR 6%
Galatasaray Sportif GSRAY TRY 6%
Hisense Kelon Elect 921 HKD 6%

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