Blogshares : Weblog Stock Market Trades Shares, Bonds, Idea and Chips
June 8th, 2005 | Filed under Miscellaneous.BlogShares is a fantasy stock market where weblogs are the companies. Players invest fictional dollars on shares in blogs. Blogs are valued by their incoming links and add value to other blogs by linking to them. Prices can go up or down based on trading and the underlying value of the blog.
The stock market game starts with you getting fictional B$500. Then you can go ahead and trade and buy stocks of other blogs. You even get 1ooo shares in your own blog just for taking the time to claim it! If you publish a blog - Add it to BlogShares.
Its not just stocks. There are Chips - the social currency of BlogShares and are the most valuable asset in the game, because with enough of them you can buy anything, win raffles, and purchase text ads for advertising your blog. If we think blogs are the companies, then ideas are their products and services. These products and services are sold on the Idea Market. Then there are karmas, bonds, artefacts … and the list goes on. I am still figuring things out.
Amused by all the hype, I registered to Blogshares.
A quick search revealed my blog was already listed on their stock exchange. Blogs start with total 5000 shares each. 1000 shares are reserved for the owner, waiting for you to claim it by inserting their code into your blog. So I claimed by blog and got hold of my 1000 shares. The other 4000 shares were already bought by someone else.
My current share price was B$503.03 and the chart reveals that my stock price is climbing rapidly from just B$2.73 on 16 May 2005. My blog has a current valuation of B$55,744.20 as per current share price. My P/E ratio or price to earning ratio is 45.12. I will be issuing more shares periodically beyond the 5000 current shares to get more stock into circulation and get it trading.
See if your blog is already listed, if not then add it and claim your blog to get your 1000 shares and become a part of this very addictive stock market game.
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You have a very interesting view on stock analysis. I would love to hear your professional opinion about the following article I came across, please sent your comments to angle_8866@yahoo.com.cn:
3 Steps To Profitable Stock Picking
Stock picking is a very complicated process and investors have different approaches. However, it is wise to follow general steps to minimize the risk of the investments. This article will outline these basic steps for picking high performance stocks.
Step 1. Decide on the time frame and the general strategy of the investment. This step is very important because it will dictate the type of stocks you buy.
Suppose you decide to be a long term investor, you would want to find stocks that have sustainable competitive advantages along with stable growth. The key for finding these stocks is by looking at the historical performance of each stock over the past decades and do a simple business S.W.O.T. (Strength-weakness-opportunity-threat) analysis on the company.
If you decide to be a short term investor, you would like to adhere to one of the following strategies:
a. Momentum Trading. This strategy is to look for stocks that increase in both price and volume over the recent past. Most technical analyses support this trading strategy. My advice on this strategy is to look for stocks that have demonstrated stable and smooth rises in their prices. The idea is that when the stocks are not volatile, you can simply ride the up-trend until the trend breaks.
b. Contrarian Strategy. This strategy is to look for over-reactions in the stock market. Researches show that stock market is not always efficient, which means prices do not always accurately represent the values of the stocks. When a company announces a bad news, people panic and price often drops below the stock’s fair value. To decide whether a stock over-reacted to a news, you should look at the possibility of recovery from the impact of the bad news. For example, if the stock drops 20% after the company loses a legal case that has no permanent damage to the business’s brand and product, you can be confident that the market over-reacted. My advice on this strategy is to find a list of stocks that have recent drops in prices, analyze the potential for a reversal (through candlestick analysis). If the stocks demonstrate candlestick reversal patterns, I will go through the recent news to analyze the causes of the recent price drops to determine the existence of over-sold opportunities.
Step 2. Conduct researches that give you a selection of stocks that is consistent to your investment time frame and strategy. There are numerous stock screeners on the web that can help you find stocks according to your needs.
Step 3. Once you have a list of stocks to buy, you would need to diversify them in a way that gives the greatest reward/risk ratio (The Sharpe Ratio). One way to do this is conduct a Markowitz analysis for your portfolio. The analysis is from the Modern Portfolio Theory and will give you the proportions of money you should allocate to each stock. This step is crucial because diversification is one of the free-lunches in the investment world.
These three steps should get you started in your quest to consistently make money in the stock market. They will deepen your knowledge about the financial markets, and would provide a sense of confidence that helps you to make better trading decisions.
About the Author: Zheng Fang is the creator of Advance Stock Pattern Scanner of http://www.cisiova.com and the owner of several stock picking blogs:
1. Optimal Portfolio
2. Candlestick Stock Picks
3. Cup and Handle Stock Picks
4. Technical Analysis
Good old days, when we consider what is happening today
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