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The Index Methodology

The Ball Metaverse Index is a selection of companies in categories defined by the Metaverse Market Map. Based on the research and analysis of an Expert Council with deep domain knowledge, the Metaverse Market Map is a detailed projection of the different types of companies that will technically enable the Metaverse, and benefit from its generated revenues and profits. These categories will change as technology and consumer behavior evolves, determined through analyses by the Expert Council, using information from corporate announcements and filings, patent filings, third-party industry assessments, third-party usage data and metrics, scientific and technology updates, executive presentations and consumer interviews.

Market Map Categories

Hardware:

The sale and support of physical technologies and devices used to access, interact with or develop the Metaverse. This includes, but is not limited to, consumer-facing hardware, such as VR headsets, mobile phones, and haptic gloves, as well as enterprise hardware such as those used to operate or create virtual or AR-based environments, such as industrial cameras, projection and tracking systems, and scanning sensors. (This category does not include compute-specific hardware, such as GPU chips and servers, as well as networking-specific hardware, such as fiber optic cabling or wireless chipsets.)

Compute:

The enablement and supply of computing power to support the Metaverse, supporting such diverse and demanding functions as physics calculation, rendering, data reconciliation and synchronization, artificial intelligence, projection, motion capture and translation.

Networking:

The provisioning of persistent, real-time connections, high bandwidth, and decentralized data transmission by backbone providers, the networks, exchange centers, and services that route amongst them, as well as those managing ‘last mile’ data to consumers.

Virtual Platforms:

The development and operation of immersive digital and often three-dimensional simulations, environments and worlds wherein users and businesses can explore, create, socialize and participate in a wide variety of experiences (e.g. race a car, paint a painting, attend a class, listen to music), and engage in economic activity. These businesses are differentiated from traditional online experiences and multiplayer video games by the existence of a large ecosystem of developers and content creators which generate the majority of content on and/or collect the majority of revenues built on top of the underlying platform.

Interchange Standards:

The provisioning of persistent, real-time connections, high bandwidth, and decentralized data transmission by backbone providers, the networks, exchange centers, and services that route amongst them, as well as those managing ‘last mile’ data to consumers.

Payments:

The support of digital payment processes and operations, which includes fiat on-ramps to pure-play digital currencies and financial services.

Content, Assets and Identity Services:

The design/creation, sale, re-sale, storage, secure protection and financial management of digital assets, such as virtual goods and currencies, as connected to user data and identity. This contains all business and services “built on top of” and/or which “service” the Metaverse, and which are not vertically integrated into a virtual platform by the platform owner, including content which is built specifically for the Metaverse, independent of virtual platforms.

Ranking and Weighting within Categories

The Index utilizes a proprietary tiered weight methodology according to the forward-looking Metaverse Market Map to reflect probable future relative share of revenue from Metaverse economic activities.

Ball Metaverse Research Partners LLC maintains the Metaverse Company Database, a database of companies relevant to the Metaverse. Upon each Selection Day, held quarterly in May, August, November, and February, every company in the Metaverse Company Database is ranked by the Expert Council as either a ‘Pure-Play,’ ‘Core’ or ‘Non-Core’ of the categories outlined in the Metaverse Market Map.

Category components are weighted on a tiered weight basis, whereby “pure-play” companies receive 2.5 times the initial weighting of “core” companies or five times the initial weighting of “non-core” companies, while “core” companies” receive two times the initial weighting of “non-core” companies. These initial weights are calculated based on the number of companies under each category in the Index upon each rebalancing, so as to ensure the total combined weight for each category is 100%. Component changes resulting from reconstitutions are made after the market close on the third Friday in each Selection Day month and become effective at the market opening on the next trading day. 

  • “Pure-Play” Companies - Companies whose primary business model and/or growth prospects are directly linked to the Metaverse. For these companies, continued growth in the Metaverse is expected to be critical to their economic success going forward via this category. A company cannot have more than two “Pure-Play” boosted categories.
  • “Core” Companies - Companies with substantial operations and/or growth prospects linked to the Metaverse. These companies have other business units driving their economics, and thus are less affected by the growth of Metaverse than pure-play companies. In time, growth in the industry and/or investments in their Metaverse-specific units may lead these companies to become pure-play companies if their Metaverse operations become a primary driver of economic performance. In most cases, the Metaverse-specific offerings of these companies are core components of the Metaverse
  • “Non-Core” Companies - Companies with operations and/or growth prospects linked to the Metaverse. These companies derive the majority of their revenue from business lines not directly related to the Metaverse. In time, growth in the industry and/or investments in their Metaverse-specific units may lead these companies to become “core” companies if their Metaverse operations become a relevant driver of economic performance. It is unlikely, based on current information, that the Metaverse-specific offerings of non-core companies would become the primary driver of such economic performance going forward.

These initial weights are calculated based on the number of companies under each category in the Index upon each rebalancing, so as to ensure the total combined weight for each category is 100%. Component changes resulting from reconstitutions are made after the market close on the third Friday in each Selection Day month and become effective at the market opening on the next trading day.

A category may have any number of ‘Pure-play,’ ‘Core’ or ‘Non-Core’ companies, including zero. Single categories are capped at 25% of the total Index upon rebalance. Insofar as a single category weighting is in excess of 25%, the weighting in excess of 25% will be pro-rated amongst the remaining categories, and subsequently equal weighted between sub-groups. In the event there are zero companies in a given category, that category’s weight is assigned on a pro rata basis at the category level.

Companies may be classified in multiple categories. Single company weightings are capped at 8%. Any weighting in excess of 8% from a single component will be pro-rated across remaining index components, subject to the 25% category cap.