Best Metaverse ETFs in Canada: Investing in the Metaverse

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by Enoch Omololu

Updated

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It is the year 2021, and metaverse ETFs, metaverse crypto, metaverse stocks, NFTs, coins, and digital real estate are a thing.

Perhaps, we have all lost our collective minds, or maybe, virtual world technologies are the next best thing since sliced bread.

The fact is that some of the hottest developments in today’s world of alternative investment assets are related to the Metaverse.

Read on to learn about the top two Metaverse ETFs available in Canada.

What is a Metaverse ETF?

According to Meta (Facebook):

The “metaverse” is a set of virtual spaces where you can create and explore with other people who aren’t in the same physical space as you. You’ll be able to hang out with friends, work, play, learn, shop, create and more.

Meta

You can think of the metaverse as a digital world where your avatar comes to life with immersive 3D experiences that are not limited by your location.

While various forms of virtual and augmented reality technologies already exist, the “metaverse” became more popular when Facebook recently rebranded itself to Meta Platforms Inc.

If you think the Metaverse world is going to grow exponentially in the future, you could potentially earn significant returns by investing in Metaverse ETFs.

These thematic ETFs are investment vehicles that invest your money in companies that are involved in the development of the metaverse.

Metaverse ETFs are just one of many ways to gain exposure to the metaverse. You can also invest in metaverse cryptocurrencies or individual metaverse-related stocks.

Best Metaverse ETFs in Canada

The two Metaverse ETFs in Canada are offered by:

  • Evolve Funds Group Inc: Evolve Metaverse ETF (MESH)
  • Horizons ETFs: Horizons Global Metaverse Index ETF

1. Evolve Metaverse ETF (MESH)

The Evolve Metaverse ETF (MESH) began trading on the Toronto Stock Exchange in November 2021.

As per the company, MESH will provide investors with long-term capital appreciation by investing in various stocks of companies that are involved in the development of the metaverse.

Key details for the Evolve Metaverse ETF as of December 7, 2021, include:

  • Inception date: November 24, 2021
  • Assets under management (AUM): $6.653 million
  • Ticker symbol: MESH
  • Management fee: 0.60%
  • Listing currency: CAD
  • Eligible accounts: Registered and non-registered investment accounts
  • Number of holdings: 25

MESH is available in both hedged and unhedged versions.

The Evolve Metaverse ETF is actively managed and currently holds 25 equity securities as follows:

MESH HoldingsAllocationMESH HoldingsAllocation
Activision Blizzard Inc4%Adobe Inc4%
Advanced Micro Devices4%Alpha Group Holding4%
Alphabet Inc – CLA4%Apple Inc4%
Autodesk Inc4%Cloudflare Inc- CLA4%
Electronic Arts Inc4%Exp World Holdings Inc4%
Intel Corp4%Matterport Inc4%
Meta Platforms Inc -CLA4%Microsoft Corp4%
Netease Inc-ADR4%Nvidia Corp4%
Qualcomm Inc4%Roblox Corp-Class A4%
Sea Ltd-ADR4%Snap Inc-A4%
Sony Group Corp- SP ADR4%Taiwan Semicon4%
Tencent Holdings Ltd- UNS ADR4%Unity Software Inc4%
Walt Disney Co4%  

The asset allocation will vary based on each stock’s price performance and actions taken by fund managers to increase returns.

As for the fund’s global diversification, the constituent stocks are geographically allocated as follows:

  • United States:76%
  • China: 12%
  • Japan: 4%
  • Taiwan: 4%
  • Singapore: 4%

MESH Fees and Returns

This ETF is brand new and will not have performance data until after one full year.

Its management fee is currently at 0.60%. The management expense ratio (MER) is not yet available.

How To Buy Evolve Metaverse ETF in Canada

You can purchase MESH using any of the top stock trading apps in Canada, including Questrade and Wealthsimple Trade.

Questrade offers free ETF purchases, and you can also use the platform to trade stocks, options, mutual funds, and FX.

New Questrade clients get $50 in free trade credits after funding their investment account with at least $1,000.

Wealthsimple Trade does not charge trading commissions when you buy or sell ETFs and stocks. And, new users get a $50 cash bonus after trading $150 worth of stocks or ETFs.

Best Brokerages for Canadian ETFs

Questrade
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Wealthsimple
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Qtrade
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$50 free trade credit

$50 sign up cash bonus

$50 bonus

$0 ETF purchases; $4.95-$9.95 for stock trades

$0 trading commission for stock and ETF trades

$6.95-$8.75 for ETF/stock trades; 100+ free ETFs

Offers other securities incl. FX and bonds

Available on all devices and great for beginners

Excellent customer support

2. Horizons Global Metaverse Index ETF (MTAV)

The Horizons Global Metaverse Index ETF (MTAV) invests in companies that will potentially benefit from “adoption and usage of technologies expected to grow and support the functioning of the Metaverse”.

This ETF is also listed on the TSX and some of the fund facts as of December 6, 2021, are:

  • Inception date: November 26, 2021
  • AUM: $4.8 million
  • Ticker symbol: MTAV
  • Management fee: 0.55%
  • Listing currency: CAD
  • Eligible accounts: Registered and non-registered accounts

MTAV hedges U.S. dollar exposure back to the Canadian Dollar.

While I could not find the number of stocks comprising MTAV, its top-10 equity holdings as of November 30, 2021, were,

MTAV HoldingsAllocation
Apple Inc5.87%
Nvidia Corp5.80%
Amazon.com Inc5.27%
Microsoft Corp5.22%
Alphabet Inc5.14%
Meta Platforms Inc5.07%
Adobe Inc4.91%
Tencent Holdings Ltd4.88%
Visa Inc4.83%
Walt Disney Co/The4.49%

It holds stocks companies in the following sectors:

  • Information technology
  • Communication services
  • Consumer discretionary
  • Financial
  • Real estate
  • Digital infrastructure
  • Augmented/Virtual reality
  • Digital marketplace
  • Creator economy
  • Digital payment
  • Gaming

As for geographical diversification, MTAV is diversified across these locations: U.S., China, Japan, Canada, Singapore, Argentina, and Britain.

MTAV Fees and Returns

The management fee for MTAV is 0.55% (plus applicable sales tax). Its MER is not yet available.

As for MTAV’s portfolio performance and returns, this data will not be available until it reaches its 1-year anniversary.

How To Buy MTAV in Canada

Like MESH, you can purchase the Horizons Global Metaverse Index ETF using an online discount brokerage account such as

Other top brokerage platforms to consider include CIBC Investor’s Edge and Qtrade.

Pros of Metaverse ETFs

Investing in the metaverse is a lot easier using an ETF.

Fund managers who have a decent research budget to pick stocks of companies that will potentially do well in the space and you don’t have to worry too much about which stocks fit in or not.

Also, since the ETF holds several stocks in different sectors and countries, you enjoy portfolio diversification. This translates into lower investment risk as opposed to investing in only a handful of individual stocks.

The availability of commission-free ETF trading platforms means you won’t be paying $10 per transaction which is also great.

Cons of Metaverse ETFs

Metaverse ETFs are not meant for risk-averse investors. If you often feel like bailing out of the stock markets when there are severe price corrections, you shouldn’t be holding an ETF that’s concentrated in only a few companies.

There is a good reason both MESH and MTAV carry a “medium” and “high” risk rating respectively.

Investing in these two Metaverse ETFs does not get you digital real estate or property in the metaverse. If your intent is to buy land in the metaverse, you’ll have to look elsewhere.

Metaverse Crypto Coins

Another popular way to invest in the metaverse is through cryptocurrencies.

Some of the top metaverse crypto coins you can find online include:

  • Axie Infinity (AXS)
  • Decentraland (MANA)
  • The Sandbox (SAND)
  • Illuvium (ILV)
  • Enjin Coin (ENJ)
  • SushiSwap (SUSHI)
  • Chromia (CHR)
  • Render Token (RNDR), etc

Many of the top Metaverse crypto coins are also related to the NFT and gaming crypto markets.

How To Buy Metaverse Crypto in Canada

You can buy Metaverse crypto using one of these crypto platforms or any of the three featured below.

Confirm that the exchange supports the coin you want to buy before creating an account!

Trading Platforms for Bitcoin Cash

CoinSmart
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Wealthsimple Crypto
WS logo
Newton
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$20 sign up bonus when you deposit $100

$50 sign up bonus when you trade $150 worth of crypto

$10 sign up bonus when you trade $100 worth of crypto

Great for advanced traders and newbies

Best crypto platform for beginners

Good for beginners

Offers 14 coins

Offers 34 coins

Offers 52 coins

Metaverse Stocks

If you think a company is going to enjoy the proceeds of the metaverse, you could invest in it directly.

Looking at the holdings of MESH and MTAV, some potential metaverse stocks you could consider include:

  • Apple
  • Adobe
  • Alphabet
  • Meta
  • Microsoft
  • Roblox
  • Walt Disney

Of course, these are just wild guesses. Do your own research!

Related:

Best Metaverse ETFs in Canada: Investing in the Metaverse

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Author

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Enoch Omololu

Enoch Omololu is a personal finance expert and a veterinarian. He has a master’s degree in Finance and Investment Management from the University of Aberdeen Business School (Scotland) and has completed several courses and certificates in finance, including the Canadian Securities Course. He also has an MSc. in Agricultural Economics from the University of Manitoba and a Doctor of Veterinary Medicine degree from the University of Ibadan. Enoch has a passion for helping others win with their personal finances and has been writing about money matters for over a decade. He has been featured or quoted in The Globe and Mail, Winnipeg Free Press, Wealthsimple, Financial Post, Toronto Star, CTV News, Canadian Securities Exchange, Credit Canada, National Post, CIBC, and many other personal finance publications.

His top investment tools include Wealthsimple and Questrade. He earns cash back on purchases using KOHO, monitors his credit score for free using Borrowell, and earns interest on savings through EQ Bank.

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