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Speaker 1: Global business news twenty four hours a day. If Bloomberg

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Speaker 1: This is a Bloomberg business flash from Bloomberg World Handquarters.

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Speaker 1: I'm Charlie Pellet. Analog Devices and Linear Technology steal a deal.

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Speaker 1: Moments ago they announced the acquisition. Analog Devices is buying

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Speaker 1: Linear the value of about sixty dollars a share. Stocks

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Speaker 1: are fluctuating with you have the doubt now turning positive

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Speaker 1: up by about half a point. Little change there at

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Speaker 1: twenty one sixty nine. Naz Stack up twelve a gain

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Speaker 1: of two tenths of one percent. Down Industrials down twenty

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Speaker 1: four a drop of one tenth of one percent. The

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Speaker 1: ten year of four thirty seconds, the yield one point

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Speaker 1: five percent. Gold up thirty cents thirteen nineteen the ounce,

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Speaker 1: little change their crude oil West Texas Intermediate Town twenty

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Speaker 1: eight cents eighty five on West Texas Intermediate to drop

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Speaker 1: there of seven tenths of one percent. I'm Charlie Palett,

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Speaker 1: and that's a Bloomberg business splash. You're listening to taking

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Speaker 1: stock with Bim Box and Kathleen Hayes on Bloomberg Radio.

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Speaker 1: Nintendo has been on quite a roller coaster the past

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Speaker 1: few trading days, posting it's worst drop in twenty six

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Speaker 1: years yesterday after the company poured cold water on the

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Speaker 1: notion that the explosive popularity of Pokemon Go would translate

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Speaker 1: into steady profits. Now, if you were looking for a

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Speaker 1: way to profit on some of this volatility, well you

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Speaker 1: could find it if you listen now to our next guest,

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Speaker 1: Andrew Shannon joins us now he's chief executive officer at

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Speaker 1: Pure Funds. It's the worst, World's first video game tech

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Speaker 1: et F. Andrew, Welcome to the show. Thanks so much

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Speaker 1: for having me, so tell us more about you and

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Speaker 1: how you came to start this g A m R gamer,

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Speaker 1: world's first video game uh tech e t F. Are

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Speaker 1: you a gamer yourself or did you say, hey, there's

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Speaker 1: a way to make a lot of money in this

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Speaker 1: Pure Funds are Our company has a has a history

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Speaker 1: of creating new investment opportunities focusing on very specific industries

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Speaker 1: and themes. We were actually approached with this idea from

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Speaker 1: an individual that has been a research channel is covering

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Speaker 1: the video game industry for roughly a decade and really

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Speaker 1: shared um and it kind of opened our eyes to

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Speaker 1: how large of an industry this really is. Most people

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Speaker 1: don't realize, but more money was spent last year on

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Speaker 1: video game technology around the world than cybersecurity. And it's

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Speaker 1: once you start learning more and more about this industry,

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Speaker 1: it becomes a much more interesting one and one that

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Speaker 1: I think more people will want to learn about. And

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Speaker 1: can you give us any number of figure? I was

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Speaker 1: looking around about twenty billion dollar a year business, so

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Speaker 1: I think that might just be for the games itself.

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Speaker 1: For all, video game technology industry is roughly over nine

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Speaker 1: billion dollars last year. Okay, so you got over nighte

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Speaker 1: deep billion dollars. Tell us about video games like Pokemon

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Speaker 1: Go that require some kind of either augmented reality or

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Speaker 1: virtual reality, and I keep thinking about fitness things like

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Speaker 1: Zombies Run and Geo Cash and for example, Fantastic. So yeah,

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Speaker 1: So these are two types of technologies that we've been

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Speaker 1: hearing about for the last several years, virtual reality, augmented reality,

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Speaker 1: and you know, ones that at times can can be overhyped.

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Speaker 1: You know, I think virtual reality still has a long

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Speaker 1: ways to go, but as far as Pokemon Go and

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Speaker 1: UM augmented reality, I think this was one of really

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Speaker 1: the first games that the mainstream um, you know, uh users, gamers,

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Speaker 1: I've realized what this technology is and how they can

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Speaker 1: use it. And now they're starting to see and understand

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Speaker 1: better and grasp how this technology can transcend just entertainment

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Speaker 1: and into things like you said, like training, simulation, fitness, healthcare, education,

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Speaker 1: and you know, the list goes on. And now it's

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Speaker 1: up to the software providers to say, Okay, this is real.

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Speaker 1: People are interested in that, they want to use it.

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Speaker 1: We can put it on mobile, we could put it

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Speaker 1: on consoles, different uh uh, different mediums like that, and

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Speaker 1: we'll it'll be interesting to see how it transcends entertainment

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Speaker 1: moving forward. Well and in fact, I'm not a gamer okay,

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Speaker 1: but to me, one of the cool things about Pokemon

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Speaker 1: Go is it makes people get out and move around,

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Speaker 1: So it sends this is is that one of the

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Speaker 1: things you think that then it fits in with this

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Speaker 1: to me, this broader uses of what we call video

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Speaker 1: games and augmented reality, so people aren't just sitting in

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Speaker 1: front of a screen with their thumbs moving, but actually

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Speaker 1: doing something. Absolutely, I can envision a future where we

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Speaker 1: see children in the classrooms using virtual reality to actually

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Speaker 1: do geography. Instead of learned geography, UM, where you're using

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Speaker 1: augmented reality to work in your in your chemistry lab

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Speaker 1: or to learn a new skill set on the job.

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Speaker 1: I think that's kind of where we are right now,

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Speaker 1: where people are saying, Okay, this technology is here with

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Speaker 1: virtual reality. Like I said, they still have a lot

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Speaker 1: of kinks to work out, which is why you haven't

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Speaker 1: seen the software there. But now seeing this success that

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Speaker 1: that Nantic and Nintendo have had with Pokemon Go, it

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Speaker 1: could be a way to kind of dust off old

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Speaker 1: game franchises or create entirely new business models. UM. You know,

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Speaker 1: why not why not have something at your at your

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Speaker 1: local department store where it's almost a game to try

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Speaker 1: to find some sale item as opposed to just show

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Speaker 1: up and get get the item on sale. I think

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Speaker 1: there's many different ways that this can be used, and

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Speaker 1: I think we're going to start to see retailers, fitness

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Speaker 1: chains things like that. Um I even have you even

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Speaker 1: heard of of fitness classes looking to kind of cash

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Speaker 1: in on the Pokemon craze and incorporate augmented reality. So

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Speaker 1: I think this is kind of opening new new businesses

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Speaker 1: that never really considered video games or gaming technology. And

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Speaker 1: are looking at ways to apply that to how they

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Speaker 1: go about their business. What's old is new again. I

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Speaker 1: keep thinking of Nintendo Power Pad or even Dance Revolution

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Speaker 1: as well as the Nintendo. We Nintendo happens to be

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Speaker 1: I believe the largest holding in the Pure Funds video

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Speaker 1: Game Tech Exchange traded fund symbol g A m R.

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Speaker 1: How does the company get into this e t F portfolio? Right,

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Speaker 1: So that's determined by the indext provider. But what they're

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Speaker 1: really looking for our companies that have a focus on

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Speaker 1: video game technology, Now what is that? Those are companies

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Speaker 1: that are developing video games and software, those developing consoles.

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Speaker 1: Even some of the chip providers um In Video and

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Speaker 1: a m D are in the fund as well as

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Speaker 1: some of the mobile gaming companies and some of the

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Speaker 1: peripheral equipment providers too. So it really looks at the

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Speaker 1: overall industry, those providing and creating the technology, as well

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Speaker 1: as the platforms that that gamers are using, even retail

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Speaker 1: companies that are selling UH games and distributing them. So

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Speaker 1: it really looks at the overall ecosystem. It doesn't just

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Speaker 1: focus on the people making the games. I think that

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Speaker 1: kind of ties into you know, This isn't just Entertainment's

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Speaker 1: not just the game companies of the software providers. It

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Speaker 1: is those that are creating all these different uses as well,

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Speaker 1: for M gamification, augmented reality, virtual reality. And right now

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Speaker 1: those areas are fairly small, but very potentially those areas

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Speaker 1: could um become a larger exposure and the fund as

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Speaker 1: they mature as well. So Andrew as someone who has well,

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Speaker 1: you have a couple of funds. When we're talking about

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Speaker 1: the Video Game fund GMR and we're going to maybe

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Speaker 1: get a chance to talk about I fly looking at drones.

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Speaker 1: But Apple's releasing today. What about the Apple earnings report?

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Speaker 1: Is important to you as the person who oversees this

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Speaker 1: video game tech e t F. Yeah. One of the

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Speaker 1: larger trends that has made gaming so much more pervasive

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Speaker 1: is that, um, you know, with the broad spread of

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Speaker 1: broadband and mobile devices, more people can actually play games

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Speaker 1: and get access to games than ever before. You don't

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Speaker 1: have to spend a couple hundred dollars on a console

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Speaker 1: and do this. With Apple, they're kind of approaching this

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Speaker 1: from from many ways, which make them an interesting holding

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Speaker 1: for the company. You know, they have the smartphones and

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Speaker 1: tablets that people can actually play the games on they're

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Speaker 1: developing Apple TV and game and game companies can actually

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Speaker 1: add games to an Apple TV, so now you can

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Speaker 1: play games directly on your TV if you have an

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Speaker 1: Apple TV device. So really what we're you know, want

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Speaker 1: to see is, um, you know, more people getting uh,

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Speaker 1: these different devices in their hands so they can use

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Speaker 1: and play these different games. So they're kind of a

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Speaker 1: platform company almost kind of like a console company, but

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Speaker 1: you know, they're they're not limited to just certain types

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Speaker 1: of companies and games being able to be accessed from

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Speaker 1: their phone. So you know, more people are are buying

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Speaker 1: and getting iPads and iPhones in their hands. That's more

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Speaker 1: potential gamers out there, as well as more people using

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Speaker 1: the app store to potentially download these games, and more

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Speaker 1: people are interested in the drone industry. The Pure Funds

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Speaker 1: drone economy strategy, E t F Symbol, I Fly Parrot

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Speaker 1: Say the French wireless products manufacturer and the maker of

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Speaker 1: Bebop drones as well as many drones. What do you

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Speaker 1: focus on? Is it defense? Is it entertainment? Is commerce?

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Speaker 1: When it comes to drones? Yeah? You know, right now,

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Speaker 1: this this is a burgeoning industry. There have been drones around, um,

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Speaker 1: you know, for for many years, but we're starting to

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Speaker 1: see it transcend just kind of the original aerospace and

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Speaker 1: defense applications, and this technology is advancing, so we're starting

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Speaker 1: to see new businesses try to incorporate drones into their

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Speaker 1: business model to create new efficiencies to better serve their

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Speaker 1: their clients and as well as do things that they

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Speaker 1: haven't been able to do before. So you know, right now, um,

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Speaker 1: you know, there are only a couple of pure play

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Speaker 1: publicly traded drone companies you mentioned parrot Ero Environment as

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Speaker 1: well in American company in the drone space, but currently

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Speaker 1: there are you know, many kinds of aerospace defense companies.

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Speaker 1: But as more companies get involved and started corporating drones

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Speaker 1: into their business lines, um, you know, it wouldn't be

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Speaker 1: difficult to see those companies start to enter the fund

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Speaker 1: as well. UM. It also does have companies that make sensors, chips,

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Speaker 1: UM cameras for drones UM currently as well. So it's

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Speaker 1: it really is this overall kind of drone ecosystem and

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Speaker 1: the indexes is cleverly built to use what they call

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Speaker 1: a proprietary drone score to rank scores based on public

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Speaker 1: information to determine what each company's footprint is in the

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Speaker 1: drone industry. And as more companies start to get contracts

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Speaker 1: or create UM create or incorporate drones into their businesses,

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Speaker 1: they have the ability to also come to the fund

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Speaker 1: and ideally, UM they'll be more pure play companies in

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Speaker 1: the fund. As more companies UM that are publicly traded

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Speaker 1: are pure play drone companies, maybe you could create a

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Speaker 1: new fund that sort of combines gaming with drones. I

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Speaker 1: don't know how you do that, but we we don't

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Speaker 1: want to get to too specific. We want to try

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Speaker 1: to capture these these broad industries that we think our

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Speaker 1: growth emerging growth opportunities and provide that ability for investors

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Speaker 1: to get global diversification. So each of the publicly traded

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Speaker 1: ets that we have all have a global exposure, so

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Speaker 1: you're not just getting what you see at home, but

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Speaker 1: really uh diversification around the Andrew Channon, thank you very much,

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Speaker 1: Chief executive officer of Pure Funds. You can follow them

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Speaker 1: on Twitter at Pure Funds, Drones and video Game Investing.

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Speaker 1: This is Bloomberg