The Macrovue Social Media thematic portfolio, known as a ‘Vue’, has delivered a very solid performance of 64.49% over the last twelve months*. By means of comparison, the ASX provided a 2.33% return over the last 12 months and the S&P 500 13.86%. Some of the strongest contributors to this performance include YY Inc. (ADR) +136.15%, Tencent (TCEHY) +105.54% and Mail.ru (MLRYY) +60.64%.
Why invest in social media?
Social media platforms have completely revolutionised the way we communicate and interact. Perhaps even more importantly, they have transformed the way businesses invest their advertising dollars. With social media powerhouse Facebook (NASDAQ:FB) commanding a market capitalization of nearly USD$500 billion, social media companies are some of the most powerful influencers on global markets, continuing to disrupt traditional business models.
Growth in social media is far from over. The big players, such as Facebook, Twitter and messaging apps like Whatsapp and WeChat continue to grow their user bases and increase their revenue ratio per user. Lesser known household names such as YY Inc and Tencent are also significant market players with huge subscriber bases and plenty of opportunities to expand into new markets.
Macrovue’s Social Media Vue comprises ten leading, publicly-listed social media companies that are the dominant players in this space. Our Social Media Vue takes a truly global approach to the theme holding the big U.S. social media companies; as well as the significant players from China and Europe.
YY Inc. (ADR)
YY Inc. is a major Chinese video-based social network with over 773 million registered users. It is China’s dominant live streaming platform by users and time spent on the platform.
The platform enables users to join real-time online group activities through voice, text, and video. Its services include music and entertainment, online games, online dating, live game broadcasting, online education, and advertising. It also features a virtual currency which users can earn through activities such as karaoke or creating tutorial videos, then convert to real cash. YY intends to tackle the video market and monetise users who watch videos online and significantly increase the presence of its live-streaming platforms, targeting the most progressive audience in this area – gamers.
China-based Tencent is one of the largest internet companies in the world. Its services include social networks, web portals, e-commerce, and multiplayer online games. Its offerings include the well-known (in China) instant messenger Tencent QQ and one of the largest web portals in China, QQ.com. Its mobile chat service WeChat has helped bolster Tencent's continued expansion into smartphone services. Tencent also holds 15% stake of JD.com, one of the largest B2C online retailers in China.
Tencent benefits from both size and scale. The instant messaging platform QQ has over 845 million monthly active users. Weixin/WeChat has over 1 billion MAUs and some 900 million of those are daily active users. Think of WeChat as a messaging app but with many of the functions of PayPal, Yelp, Facebook, Uber, Amazon, Expedia, Slack, Spotify, Tinder, and more. It is becoming the primary means of communication both within and for communicating with China.
Russian Mail.ru Group Ltd (MLRYY)
Russian Mail.ru Group Ltd. develops internet communications and entertainment services. The company also operates e-mail services such as instant messaging services, Mail.Ru Agent and ICQ, as well as Russian language online social networking sites VKontakte, My World@Mail.Ru, and Odnoklassniki.ru. It also develops e-commerce projects as well as online games that include MMOGs and social networking sites.
The Mail.Ru Group Games business unit is the largest player in the Eastern European online entertainment market specialising in client and browser MMO games, social network and mobile games. The company develops and publishes games in Russia, CIS countries, Europe and North America. Mail.Ru Group’s games have over 95 million registered users worldwide. Mail.ru, as Russia's leading social network, continues to benefit from its strong targeted advertising capabilities, including native (Russian language) advertising and mobile formats.
Important: This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. Consider the appropriateness of the information in regards to your circumstances.
*As of 15/03/2018. Returns are expressed in AUD. Past Performance is not a reliable indicator of previous performance. See how our performance is calculated.