Expert insights from BlackRock Fundamental Equities

Step into the metaverse

May 3, 2022

Capital at risk. The value of investments and the income from them can fall as well as rise and are not guaranteed. Investors may not get back the amount originally invested. 

Key points


A whole new world

Major technology companies have made it clear that the metaverse is the next frontier of the digital world.


Why now?

Next-generation hardware such as augmented reality glasses, accelerated digitalization, and wider use of cryptocurrencies.


Investing in the future

The metaverse isn’t a reality for most people yet. But the investment opportunities are here now.

The power of engagement

Technology and internet companies – as well as consumer brands and marketing companies – are laser-focused on one key goal: engagement. Today, advertisements are shown to people globally who spend an average of more than two hours a day on social media, according to GlobalWebIndex. Tech and consumer companies believe this amount of time could multiply many times in the metaverse, having enormous revenue implications for companies selling adverts and consumer goods.

A giant leap into the metaverse

Momentum of “metaverse” mentions in company transcripts vs. other themes

Source: Morgan Stanley, Nov. 2021. The chart shows the speed at which mentions of select technological themes in global company transcripts reached “peak interest.” A value of 100 is the peak popularity for the term. A value of 50 means that the term is half as popular.

The screen’s the limit

Virtual worlds already exist, but they are limited by old technology where a two-dimensional screen is the limiting factor

Why now? Three reasons

We see three reasons behind metaverse momentum: next-generation hardware, COVID-accelerated digitalization, and wider use of cryptocurrencies

Investment opportunities

Initial opportunities might be found in companies that will supply components for – and assemble – the next-generation hardware such as augmented-reality glasses

Consumers in the metaverse

We believe that consumer brands that embrace the metaverse today will capture the attention of younger generations in decades to come.

Risk warnings

Capital at risk. The value of investments and the income from them can fall as well as rise and are not guaranteed. The investor may not get back the amount originally invested.

Past performance is not a reliable indicator of current or future results and should not be the sole factor of consideration when selecting a product or strategy.

Changes in the rates of exchange between currencies may cause the value of investments to diminish or increase. Fluctuation may be particularly marked in the case of a higher volatility fund and the value of an investment may fall suddenly and substantially. Levels and basis of taxation may change from time to time.

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