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Home , Las Vegas Raiders

Risk Rating: The Raiders Turn to Sin City... Is Vegas Worth the Gamble?

The Oakland Raiders , Oakland-Alameda County Coliseum, is over 50 years old. The team decided that it was time to build a new stadium, relocate to another venue, or renovate the existing stadium.

At first, the team expressed interest in - which made sense because Los Angeles had no team and the Raiders were there from 1982 - 1994. However, the Chargers and Rams locked in that city before them.

Shortly after, emerged as a likely location for the team and, in March 2017, the Raiders announced that they were moving there for the 2020 season. The $1.8 billion stadium will have a capacity of 65,000. This is nearly 12,000 more seats than the current stadium, but still the 5th smallest capacity in the NFL. This follows a recent trend - newer are built with fewer seats so the team can create a more intimate fan experience.

Are the Las Vegas Raiders a valuable investment for ticket brokers? Here’s our analysis and Risk Rating.

The Oakland Raiders Current State

In past 10 years, the Oakland Raiders only made the playoffs once.

Their strongest season was in 2016 when they lost in the wild card game to the . had a career-best season and led the Raiders to a 12 - 4 record, but their dreams came to an end when Carr was injured and could not play in the playoff game. The team’s next couple years were supposed to be strong but ended in losing records.

In 2018, many were surprised when and draft picks were traded to Chicago for draft picks (including two first round picks in 2019 and 2020). Then, in the middle of the season, the Raiders traded to Dallas for a 2019 first round pick. The Raiders were acquiring strong draft picks and building the team around Carr.

The 27-year-old quarterback signed a $125 million, 5-year contract with the Raiders in 2017. With this investment, the team made it clear that they believe in Carr and are hoping that he hasn’t reached his peak.

Interested in learning more about Broker Genius? Sign up for a free trial at brokergenius.com/free-trial According to several Vegas Sportsbooks, the Raiders are one of the least likely teams to make the Super Bowl in 2020. It could take several years for the Raiders to become playoff contenders, so ticket brokers might experience a lower and slower return the next few seasons.

The Vegas Upside

In 2018 Las Vegas welcomed three teams: the Las Vegas Lights FC to the USL, to the NHL, and to the WNBA. Although only one of these is a dominant league, this many new teams in just one year prove that Vegas is a hot spot for sports.

Additionally, now that gambling has been adopted across major sports, Vegas is an even stronger destination for an NFL team. Once the league allows betting in stadiums, the Vegas Raiders will likely embrace this first and make it a big part of the fan experience both during the games and throughout their stay.

Ticket brokers should also consider the mindset of people traveling to Vegas. The Vegas visitor is ready to splurge, win, and lose money. The market is primed for big spenders to buy tickets.

Las Vegas Ticket Price Volatility

Typically there is a correlation between a team’s performance and a broker’s return. However, as seen in the NHL, Vegas is an outlier.

We compared the Vegas Golden Knights to three other NHL teams with similar records by analyzing their average ticket price, return on investment (ROI), and coefficient of variation. The coefficient of variation is a measure of volatility. It’s a percentage of how far ticket prices fluctuate from the average ticket price.

2018 - 2019 Season 2017 - 2018 Season Until 2/1/2019 Average Coefficient Average Coefficient Team ROI ROI Ticket Price of Variation* Ticket Price of Variation* Vegas Golden Knights $143 27% 32% $160 26% 75% Nashville Predators $123 33% 49% $109 32% 63% Boston Bruins $174 33% 28% $121 32% 28% Washington Captials $70 41% 3% 73% 53% 31% * By what percentage do prices fluctuate from the average?

The Golden Knights tickets are less volatile than the three other teams in 2018 and 2019. It’s a less risky investment because they don’t fluctuate too far from the average ticket price.

Interested in learning more about Broker Genius? Sign up for a free trial at brokergenius.com/free-trial On one hand, investing in Raiders tickets seems risky. It’s rare for new teams to have a strong first season like the Golden Knights, who reached the Stanley Cup Finals and benefited from the “new team effect.” Also, the dispelled the notion fans carry over from one city to another. Therefore brokers should not expect Oakland fans to automatically support the Las Vegas team; they might have to build a fanbase from the ground up.

Even with all that said, the Golden Knights had a high average ticket price, low volatility, and high ROI in the last two seasons. One key reason is that Vegas is a desirable spot for the home team’s opponents to visit. This causes less volatility because the city is more likely to attract visiting fans that are willing to pay higher prices. If this same trend affects the Raiders, tickets would be a low- risk and profitable investment.

What To Do Today

The Las Vegas Raiders will be the 17th NFL team to offer Personal Seat Licenses (PSLs). The PSLs, which cost $500 - $75,0001, are not very desirable investments for ticket brokers because they are additional fees on top of the season ticket.

Today PSLs are being distributed to people who made the $100 deposit. If you have not done this yet, the deposit can still be made online.

Our Verdict • The visiting teams’ fans are going to Vegas ready to spend money Risk - and this includes buying tickets • Ticket brokers experienced a great season with the Vegas Rating: 4 Golden Knights because the team had a landmark first year and 1 = No Risk, 10 = High Risk benefited from the “new team effect.” Having said that, tickets in Vegas were not very volatile in both 2018 and 2019. If this trend continues with the Raiders, the investment will maintain a low- risk profile • The Raiders are in build mode and it might take 3 - 5 years for the team to be true playoffs contenders

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Footnotes 1 https://www.reviewjournal.com/sports/raiders-nfl/raiders-reduce-cost-of-some-psls-for-las-vegas-stadium-1576390/

This report does not constitute recommendations or advice on investing strategies, buying or selling tickets. You alone assume the responsibility of evaluating the merits and risks before making decisions. In exchange for using the information provided herein, you agree not to hold Broker Genius, its affiliates, or any third party service provider liable for any action taken or damages resulting from your use of this report.