If you’re looking to diversify your portfolio or pursue a new sector, you should consider stocks in the virtual reality industry. Virtual Reality, or VR, is described by Wired magazine as technology that “computer-dialed stimuli create the immersive illusion of being somewhere else.” From handsets to headsets, virtual reality has been predicted to grow significantly in capital markets. VR can be applied in many different industries, including healthcare, therapy, entertainment, art, training, or even real estate. It has been shown to not only be a tool for entertainment, but for acquiring knowledge.
There are many reasons for the predicted growth in the VR industry, but the biggest is COVID-19. Due to the pandemic, many had to stay at home and reduce socialization. Because of this, the need for escape rose, as shown in increased hours of TV streamed or video games downloads. VR has been able to perfectly fill that need for escape, as an individual is transported elsewhere easily.
As an investor, looking at the performance of the VR industry as a whole is important for your potential ROIs. At Deep Tech Insider, we want to offer a couple of reasons why investing in virtual reality companies can lead to higher ROIs. Our points are recommendations only, and we do not guarantee anything. But from our research, we know that generally investing in the technology sector leads to a successful return. According to the Motley Fool, the information technology sector has been the best performing sector in the S&P for the past 10 years. And within that, virtual reality is slowly growing.
Virtual Reality Taps into Several Markets
Virtual reality is an excellent sector for capital markets as it can be applied to other industries. VR is best known for video gaming and can tap into that trillion-dollar market. But it can also tap into the healthcare industry, as medical students can use it for practice surgeries. In other cases, it can be used for training, like Lockheed Martin used the Microsoft Hololens to help build the Orion spacecraft. Because VR has many applications it will increase the margins of the companies selling it and their investors.
Virtual Reality Takes Less Time for R&D Than Other Deep Tech Industries
While VR technology does take time to develop, in comparison to other deep tech industries, such as quantum technology, super-computers or new energy, the timeline is relatively short. This is beneficial for some investors who want to have a rather short time for a product to be market really. In 2014, Facebook bought Oculus, one of the biggest VR companies. Through a couple of years of upgrades and development, they hope to have 100 million shipments of VR equipment by the end of 2021. That equals a lot of ROIs for a potential investor in a relatively short time.
VR is 5G Approved
According to the Cabot Wealth Network, the traffic, or demand, for VR is predicted to rise by 1,100%. This is mainly due to the implementation of 5G, which will increase data speeds. Because VR needs a certain data processing speed to function, the use of 5G will make VR more accepted and widely used.
VR Feeds into Our Love of Screens
Recent studies have illustrated how addicting our devices (phones or tablets specifically) can be. The bright screens, the likes, the notifications, all of these things keep our devices close to us. While VR isn’t a phone or tablet, its screen feeds into our love of new devices and gadgets. It’s no wonder VR is predicted to grow as an industry, as it is almost already part of our subconscious addictions.
For a potential investor, VR stocks such as Facebook or Sony will be the ones to watch for the rest of 2021 and into the next year.
Green, Adam. 2019. “VR and AR Investing: All You Need to Know.” Inspirationfeed. November 7, 2019.
Hoium, Travis. 2019. “What You Need to Know about Investing in Virtual Reality Technology.” The Motley Fool. August 27, 2019.
“Is Now the Time to Invest in Virtual Reality Stocks?” 2021. Cabot Wealth Network. August 17, 2021.
Reeth, Mark. 2021. “8 Virtual Reality Stocks to Watch in 2021.” US News & World Report. U.S. News & World Report. 2021.
Rossolillo, Nicholas. 2020. “3 Ways to Invest in Virtual and Augmented Reality.” The Motley Fool. July 16, 2020.
Willard, Cody. 2021 “Opinion: Virtual Reality Is Your next Investing Revolution, and Facebook Is at the Forefront.” MarketWatch. January 2021
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