How and Why VR and AR Stocks Could Enhance Your Portfolio

7 Min read

The hype around virtual reality (VR) and augmented reality (AR) stocks appears to have cooled off. Failure of the two technologies to revolutionise the world as previously envisioned could be one of the reasons behind a decline in VR and AR market hype. However, that does not mean that there are no investment opportunities worth pursuing in the two interconnected emerging marketplaces.

While AR and VR might not be taking the world by storm in the short term, when we consider the bigger picture, these technologies have some exciting prospects as long-term technological investments.

Increased investment is a testament to the fact that exciting innovations are on the way, helping to excite the VR and AR stock markets. In 2018, for instance, venture capital fund Sure Venture invested £500,000 into Immotion Group Limited, showing how virtual reality companies are alive and kicking.

The UK-based firm is an example of a forward-thinking company focused on creating superior, out-of-home, immersive VR experiences. Indeed, the UK plays host to a number of virtual reality companies, with the emergence of innovations helping to explain why revenues in the VR sector are poised to skyrocket to US$160 billion by 2025. Expected growth affirms why now might be the best time to eye up investment opportunities around these two technologies.

Reasons to Invest in Virtual Reality and Augmented Reality Stocks

Virtual reality and augmented reality are revolutionary technologies poised to disrupt various sectors, from healthcare to manufacturing, as well as education. These technologies are also increasingly being used in both real estate and finance. With the increased application of VR and AR tech also comes an interest in virtual reality stocks such as Oculus VR stock. Oculus is currently a lead runner in the VR sector.

There are many reasons to invest, including:

Widespread Exposure

One thing that investors should remember is that VR companies are also making big plays in the AR space. By investing in such companies, you could essentially kill two birds with one stone. There's also a real chance to diversify your investment portfolio with exposure to two fast-growing sectors.

Google is one of the companies that promises to provide investors with exposure to both AR and VR technologies. Healthcare professionals, as well as factory workers are already carrying out tests on Google Glass as they try to leverage its capabilities in their workplaces.

Big Data Analysis

VR and AR systems have the potential to streamline processes and reduce the amount of manual work needed, given the amount of data they can process. Qualcomm is an ideal AR and VR stock, given that it has started working on chipsets for powering AR and VR applications. These chipsets will make it easier for developers to come up with immersive systems.

Education Sectors

A number of virtual reality and augmented reality companies are working on immersive technologies for enhancing learning experiences. The main focus at the moment is coming up with technologies that will bring about a paradigm shift in how people look at school education with VR, which appears to be the next evolutionary step for the schooling sector. Such innovations should also enhance how students retain information, interact in class, and gain knowledge.

Education potentially becoming a multi-billion sector essentially means AR focused companies stand a good chance of generating significant value going forward. With a clear strategy and optimum focus, such companies should be able to generate more shareholder value.

Gaming Technology

The VR and AR stock market will also expose investors to the multi-billion gaming industry. Gaming companies are increasingly using the two technologies to enhance the overall gaming experience for players. Niantic's Pokémon Go is an example of one of the games leveraging AR to overlay fantasy characters into real environments.

Healthcare Sector

The healthcare sector is another industry poised to benefit a great deal from AR and VR innovations. AR is already allowing trainee and practicing physicians to see data without detaching themselves from critical tasks. In the future, such technology will help practitioners understand how to administer new treatments better, and how to carry out procedures.

Augmented reality has also found use cases in helping pharmaceutical companies to improve patient education. By simply visualising complex products, pharmacists are now able to educate their audience regardless of age. Google Glass has already been used to perform operations for over 14,000 studies.

Vuzix is an AR stock for people interested in how the two technologies are advancing the healthcare system. The company has already developed an AR powered apparatus that helps blind people to get around with ease. Its products 'M300 Smart Glasses' and 'Vuzix Blade' are also finding application in enterprise, which is increasing the amount of work that gets done.

What to Consider When Investing In AR and VR Stocks

Investors should always keep in mind that VR and AR companies need more time to come up with value-generating applications and systems to market. Overall expense and uncontrollable costs are factors that help to explain why VR companies are moving slowly on such innovations.

Facebook, upon pricing its Oculus device at $599 was forced to slash it twice, all in the effort of attracting sales. This tells the story of why VR companies have been reluctant in engaging in mass VR/AR production. CEO Mark Zuckerberg has already indicated that it could take at least five to 10 years for the two to take off. Stocks such as Magic Leap stocks are also only available when companies go public, and this is something to keep in mind at all times.

Bottom Line

Despite the hype cooling down, it's only a matter of time before innovations built around virtual reality and augmented reality come into being. Studies indicate that AR and VR companies will create an industry with a market value of over $160 billion.

What this means is that the two technologies will change the face of the world for good. In return, people who invest early in AR and VR stocks stand a better chance of potentially walking away with huge returns. Remember, the best way to approach any type of trading or investment is by implementing risk management strategies first, to ensure you are aware of the risks, and are managing them effectively.

Picking AR and VR stocks all comes down to a solid investment strategy that one can cling on to for the long haul. Currently, no major public companies are betting on these two technologies entirely or earning significant profits. That said; patience is key if one is to generate any returns from investing in the AR and VR sector.

Invest With Admiral Markets

If you're ready to take your trading to the next level, Admiral Markets has the ultimate investing opportunity for you! Invest.MT5 is an elite investing account that offers traders the ability to invest in thousands of stock and ETFs, on 15 of the world's largest stock exchanges. Access FREE real-time market data, premium quality market updates, low transaction commissions, and more, all while trading with a state-of-the-art trading platform - MetaTrader 5. Begin your investment portfolio the right way by clicking the banner below!


About Admiral Markets
Admiral Markets is a multi-award winning, globally regulated Forex and CFD broker, offering trading on over 8,000 financial instruments via the world's most popular trading platforms: MetaTrader 4 and MetaTrader 5. Start trading today!

This material does not contain and should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments. Please note that such trading analysis is not a reliable indicator for any current or future performance, as circumstances may change over time. Before making any investment decisions, you should seek advice from independent financial advisors to ensure you understand the risks.

What Is The Santa Claus Rally and How Do You Trade It?
At the end of every single year, both traders and investors gear up for a unique phenomenon in the markets called the 'Santa Claus rally.' Over the years, there have been many different interpretations of this unique event in which the S&P 500 stock market index has averaged a gain of 1.6% with...
What is a Short Squeeze? Definition, Markets & Strategies
In early 2021, a group of online day traders banded together to short squeeze several different markets which resulted in moves on some of those markets of more than 1,000%!This extraordinary volatility and price movement has thrust the attention towards questions such as ‘what is a short squeeze?’...
Microsoft Shares: Should I Buy Microsoft Stock?
With the phenomenal growth of tech stocks such as Tesla over the past year or so, many investors are eager to find the next big thing. This eagerness to find the perfect growth stock means that well-established, mature companies are often overlooked. True, these types of companies have already been...
View All