What is the next big investing breakout?
That’s what investors want to know because that’s the opportunity for big gains, the 10-bagger or even 100-bagger.
Get in on the new thing early and beat the big banks and institutional investors.
But not every trend is going to produce. We all know that.
If you’re smart you have a watch list. Not just a stock watch list but a trend watch list.
Something you’ve spotted previously, and thought might make a great investment.
Lots of investors do this. They see something growing in popularity in their daily lives and make an investment.
What you need is a sign. Some sort of confirmation that the trend you’re watching is on the verge of the breakout that will produce big gains.
The Super Bowl provided one of those signs for those paying attention.
And it wasn’t anything on the field or in the ads.
This was the first Super Bowl since the Supreme Court decision that allowed states to legalize sports betting.
If you don’t remember, last May the Supreme Court ruled 6-to-3 to eliminate the 1992 federal law prohibiting nearly every state from allowing sports betting. The decision is now up to each individual state.
And the numbers up for grabs are staggering. In 2017, $4.87 billion was wagered in Nevada, then the only state allowed to have legal sports betting. That’s not even 4 percent of the estimated $150 billion that was bet through illegal bookies.
The states see a money-making opportunity here. Since the Supreme Court decision, the race has been on to see who could cash in on the business, and tax revenue, associated with legalized sports gambling.
The market is huge. The amount of money bet on last year’s Super Bowl over $4.5 billion! On just one game.
And to give you a sense of the growth potential in legalized gambling — more than 95% of those bets were illegal. This was the first year a few states could accept bets legally.
New Jersey has reported its numbers associated with the big game, and Matt McCall, editor of our Investing Opportunities service, was waiting.
As regular readers know, Matt is our expert in investing trends – the macro opportunities that provide the biggest potential for huge gains. He has been tracking the sports book potential, along with investment opportunities in next generation batteries, autonomous vehicles, and, of course, legalized marijuana.
Here is what Matt wrote to his subscribers this week.
In New Jersey’s first year of legal sports betting, folks wagered nearly $35 million on the Super Bowl. The sportsbooks themselves lost money because most of that was on the New England Patriots. Still, I’d say going from $0 wagered last year to $35 million this year is a sign of what’s to come.
In Nevada, the total amount bet fell to $145.9 million. That was still the second-highest total ever after last year’s $158.5 million.
There are a few reasons for the decline in Nevada. Overall interest in the game appears to have been somewhat low with the Patriots playing in it yet again. TV viewership was also down.
In addition, there was little scoring in the game, so the amount of in-game betting was likely lower than it would have been otherwise.
These “prop” bets (short for proposition bets) have huge potential. Prior to this year’s Super Bowl, one sportsbook listed 442 prop bets. 442!
Here are just a few from Sunday’s game:
- Coin toss result (tails)
- Coin toss winner (Rams)
- First turnover (Patriots)
- First timeout (Patriots)
- Number of punts, over or under 6.5 (Over)
- MVP (Julian Edelman)
Heck, you could even bet on which songs would be sung first and last during the halftime show. Or how long the national anthem would last.
To add some context to Matt’s numbers, Nevada has 200 sports books, and New Jersey has 12! That means Garden State sports books took in about $3 million each.
And remember this is just bets on the game. None of this counts other money gambled by the same people at different attractions – or the food or alcohol.
Other states with legalized gambling, such as Pennsylvania and West Virginia have not released numbers yet. But it’s easy to imagine what’s going to happen when really big states get in on the act.
Now that New Jersey has legalized sports books, how long until New York follows? Can you imagine a sports book in Times Square?
And imagine when California decides to steal that part of Nevada’s business!
Once states get a look at the numbers that can be generated from one game, and one season, they are going to be in a race for those dollars.
If all this sounds familiar to you, you’re probably thinking of legalized marijuana. It followed the same pattern.
Two states legalized it first – Colorado and Washington – in 2014. Since then, 33 states have approved medical marijuana, and 10 others have legalized it for recreational use. Jeff provided an update on the status of the legalization efforts yesterday.
Eight states have fully legalized sports betting – Delaware, Mississippi, Nevada, New Jersey, New Mexico, Pennsylvania, Rhode Island and West Virginia.
New York and Arkansas have recently passed bills on the subject, and bills have been introduced in legislatures in 27 other states, according to ESPN.com.
Now that the Super Bowl is over, smart states will be looking to ramp up their efforts for the next big thing – the NCAA Basketball Tournament.
Keep your eyes out for your state and others, and check out Matt’s Investment Opportunities service to get a the best information on the trends about to break out.
To a richer life…
Luis Hernandez, Managing Editor
and the research team at InvestorPlace.com
