Game, Set and Profit: how to invest in Wimbledon’s success

Staci West 09/07/2024 in Equities

Wimbledon is here again! Few things in life are more quintessentially British than the annual tennis tournament in southwest London. The 14-day event is a fixture of the sporting calendar and welcomes more than half a million people through the gates every year.

The showpiece event is the principle activity of The All England Lawn Tennis Club and played at its main site, which has 18 championship grass courts and a further 14 practice courts. Last year, which was the 136th time ‘The Championships’ had been held, featured players from 70 different countries competing in the various qualifying and main draw events.

Millions more tune into the live streams on BBC iPlayer and BBC Sport online during the fortnight as only 42,000 spectators can be in the grounds at any time.

But, are there any ways in which investors can make money from this multi-million pound spectacle?

The answer is yes…well, at least in theory.

How investors can make money

The most obvious is through buying shares in some of the many corporate sponsors that are keen to align their brands with Wimbledon. The hope is that these companies will benefit from the increased exposure and subsequent sales spike by seeing their share prices rise.

This year’s official partners include many global household names, such as Stella Artois, Range Rover, Pimm’s and American Express. As many of these sponsors are large businesses that either trade on stock exchanges in their own rights – or under a parent company – there’s quite a lot of possibilities.

The list also features Slazenger, which is one of the world’s oldest sports brands. The equipment it makes includes, of course, the official Wimbledon tennis balls. Slazenger is owned by the FTSE 100-listed Frasers Group, which owns a wide variety of well-known brands, including Sports Direct. The company’s share price has risen 227% to 862p over the last five years. Although the price has fluctuated over time, it’s up around 11% in the three months to July 8, 2024.

Food and drink

A popular part of the whole Wimbledon experience is eating the strawberries and cream that have become synonymous with The Championships. The variety served up are known as ‘Malling Centenary’ and produced just 31 miles away by the family run Hugh Lowe Farms. On average, 34.8 tonnes of strawberries are eaten during the fortnight.

Pimms: it’s the iconic Wimbledon drink. The gin-based fruit cap was created by James Pimm back in the 1800s and is owned by London-based Diageo. The company is one of the largest holdings in the TM Redwheel Global Equity Income fund*, which aims to provide a combination of income and long-term capital growth. This portfolio, which is run by a team of four headed by Nick Clay, has a true contrarian nature and will be broadly diversified across sectors.

Watch our recent interview with manager Nick Clay

Corporate sponsors

Barclays, the UK-based bank, is also one of Wimbledon’s corporate partners and currently occupies the largest individual position in the Schroder Recovery fund*. The aim of this fund is to deliver attractive capital growth by investing in companies with good long-term prospects whose share prices have suffered.

Barclays is also one of the 10 largest holdings in the Jupiter Financial Opportunities fund* that aims to provide long term capital growth. Its manager, Guy de Blonay, calls on his experience and knowledge to construct a portfolio of ideas from financial services and other related firms from across the world.

Broader UK exposure

Lastly, investors looking at opportunities in UK equities more broadly, in the hope that a successful Wimbledon will rub off on a selection of British businesses might consider the IFSL Marlborough Special Situations fund, which has a small and mid-cap focus and is co-managed by Eustace Santa-Barbara and Guy Feld. Relatively small positions are usually taken initially, and holdings added to as the team becomes more comfortable with a company and the management delivers on plans.

We also like abrdn UK Mid-Cap Equity, which is a high-conviction strategy which invests in medium-sized companies for the long term. It invests in businesses when they are well established, but still have a long runway of growth potential. The fund does have a natural style bias in favour of growth, meaning it may struggle in some types of market.

Read more: Can a Labour government turn the tide for UK companies?

*Source: fund factsheet, 31 May 2024

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