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Trading Entertainment Stocks Explained: All You Need to Know
The entertainment industry has evolved and progressed in recent years, mainly driven by technology. As a result, entertainment stocks have become an appealing option for many traders and investors.
This article breaks down what entertainment stocks are, the various sectors they include, and why they might be a suitable fit for your trading strategy.
Let’s take a closer look at the ever-changing entertainment sector and how you can gain exposure to the shares of the involved companies:
What Are Entertainment Companies & Entertainment Stocks?
Entertainment companies focus on creating, producing, and distributing content and experiences meant to entertain audiences. As such, entertainment stocks refer to shares in publicly traded companies that operate in different areas of the entertainment industry. This includes businesses producing, distributing, or promoting content across various platforms.
Types of Entertainment Companies
The entertainment industry is multifaceted and includes multiple types of sectors to keep in mind. Here are the main types of entertainment companies:
Electronic
Electronic entertainment revolves around interactive experiences accessed through electronic devices, primarily focusing on video games. This sector includes companies like Electronic Arts (EA) and hardware manufacturers like Sony and Microsoft. Other companies in the mobile game industry, like King (the creator of Candy Crush), are considered electronic companies.
Digital
Digital entertainment refers to content readily accessible through online platforms. Streaming services have become essential in this area, with platforms like Netflix and its competitor Hulu offering extensive collections of films and television shows for viewers to watch at their convenience.
Live
Live entertainment focuses on crafting live musical, theatrical, and more events. Concert promoters play a vital role by organising large-scale events. Examples include theatre companies and sports events.
Mass Media
Mass media companies aim to connect with large audiences using traditional and digital platforms which include broadcasting companies and radio stations as well as print media among other things.
Exhibition
Exhibition companies specialise in showcasing content in physical spaces, allowing audiences to engage directly with various experiences. This includes exhibition entertainment like art exhibits and fairs. It also includes amusement and water parks, festivals, aquariums, zoos, wax museums, and more.
Biggest Entertainment Stocks
Plus500 offers share CFDs on some of the biggest entertainment companies as of June 2024:
A Japanese consumer electronics company founded in 1946 and headquartered in Minato City, Tokyo, Japan. Sony is famous for its digital products like TVs, smartphones, and PlayStation.
An American telecommunications and media company founded in 1963 and headquartered in Philadelphia, Pennsylvania, USA. It specialises in cable provision, video, and internet services.
An American multinational mass media entertainment conglomerate founded in 1923 and headquartered in Los Angeles, California, USA. Disney is famous for its entertainment parks, entertainment services, and content sales, among other services and products. Read more about Disney’s business model in our article “Trading the Happiest Place on Earth: Walt Disney Stock.
An American streaming and entertainment company founded in 1997 and headquartered in Scotts Valley, California, USA. The company specialises in its streaming services, and you can read more about it in depth in our article “Netflix Stock Price Guide: What Drives NFLX Price?”
A Swedish media services and audio streaming company founded in 2006 and headquartered in Stockholm, Sweden, EU. Specialises in broadcasting digital music, podcasts, and video services.
An American international entertainment and hospitality company founded in 1986 and headquartered in Las Vegas, Nevada, USA, operates resorts across the USA. (Source: Wikipedia)
Why Trade Entertainment Stocks
The entertainment sector is vital for media, film, and leisure, making it an appealing choice for investors. Steady demand, increasing consumer spending, technological advancements, and a shift toward streaming drive growth. This sector’s resilience during economic fluctuations ensures reliable revenue, and its diverse opportunities, from film studios to gaming, could allow for a well-rounded portfolio.
How to Trade Entertainment Share CFDs
Trading the rising and falling prices of entertainment shares can be done using Plus500’s Contracts for Difference (CFDs). These CFDs provide exposure to price changes without requiring ownership of the shares. Additionally, entertainment share CFDs are often leveraged, meaning that both gains and losses can be amplified.
Conclusion
In conclusion, the entertainment sector presents a dynamic landscape for investors and traders, with diverse opportunities across gaming, streaming, and live events. Driven by consistent demand and technological advancements, entertainment stocks are appealing additions to trading portfolios. By using CFDs, investors can navigate this space and gain exposure to growth potential while remaining aware of the risks associated with leveraged trading.
FAQs:
What Are Entertainment Stocks?
Shares in publicly traded companies involved in creating, producing, or distributing entertainment content across various platforms, including film, music, and gaming.
What Are the Different Types of Entertainment?
The entertainment sector includes electronic companies (video games), digital streaming services, live event organisers, mass media companies, and exhibition firms (amusement parks, art exhibits).
What Are Some Examples of Major Entertainment Stocks?
Notable entertainment stocks include Sony, Comcast, Disney, Netflix, Spotify, and MGM Resorts.
