| Maxwell 'Danger' Powers (Little Upsilon) | Thursday, March 19, 2009 - 04:35 pm 
Hi,
I noticed something recently and wondered if this could be exploited on a larger scale to make money. Or whether this sort of thing goes on all the time anyway.
Here is the thing I noticed:
I recently IPOed a state company, a cable TV services company. About a year (and after offering 15% of shares) later, cable TV had a supply spike and profits tumbled. Share price shortly tumbled to ~10% of what it once was. I then repurchased all the shares and turned the company back to a state one. By my calculations, I sold shares at ~$10-20 and bought them back for ~$3 each. This means I made a tidy profit, no?
So, what is to stop my doing the same thing with all my companies. The vast majority of share buys are by country investment funds which act practically blindly.
Is there something I am missing? Any information about the details of expenses during share buys/sales is greatly appriciated.
PS I believe this is essentially short selling. Betting that over time the prices of a stock will go down. |
| Zdeněk Pavlovský (Fearless Blue) | Thursday, March 19, 2009 - 05:21 pm
to put it bluntly
the time and energy required to execute the (trans)actions for creating such "profit", here it's important to note that nothing "real" is created in fact, does not validate it.
for example:
corp has value 1T SC$ ~ 2.25 GC ~ 0.225 USD
to make 1 USD one would have to IPO almost 5 corps like that, sell down to almost 0%, then when prices would be near 0 buy back again, or build another 5 corps like that, IPO, sell down, etc etc.
how long would it take to make 1 USD?
including keeping track of all data, including clicks needed, included calculating how much is 10% and how much is 15%?
i dunno, but my guess would be around 1 real hour.
perhaps someone used to first person shooters and blitz chess with some sort of excel script could do it faster. that is possible.
perhaps if those billions around the world who live on 2 USD per day would play Simcountry, they could even buy an ice cream once in a while, but for the rest of us, for those Jesus loves, there are less time and energy demanding ways of acquiring SC$.
of course, this is not to discourage you from trying or making "profit" the way you described. its, in the context of game mechanics, valid concept. |
