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(USA Today)   Anytime you think that the guys on Wall Street are smarter than you, just remember this headline: "Zynga stock surges"   (usatoday.com) divider line 3
    More: Strange, Zynga, Wall Street, tides, social games, headline, blood, game companies  
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1611 clicks; posted to Business » on 25 Oct 2013 at 2:44 PM (51 weeks ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2013-10-25 03:01:09 PM  
3 votes:

nocturnal001: don't know about that per se


It's because of the single most important rule of trading that a lot of Fark's business tab commenters seem to have a hard time remembering: you don't put money into a stock because it's doing well right now, you put money into a stock because you think it will do well in the future.

Amazon, despite its lack of profit, is doing well in the market because traders believe that all the money they plow back into the business (which is where the profit is disappearing to) is going to pay off in the future. Microsoft is approached with trepidation because traders are concerned about the future of its Windows 8 line in the face of dwindling PC sales, the upcoming change of leadership, etc. They believe Amazon will be profitable in the future, they are concerned Microsoft may not be, the fact that those positions are switched NOW is irrelevant.

It's the same reason you see selloffs in stock at a profitable company that doesn't quite hit expectations. The people that already own the stock expected better back when they bought it and set their goals accordingly, so when the expectations weren't met now that the future is here some of them rebalanced their portfolios by moving their money somewhere else to a company more aligned with their future plans. It's all about the future, not the now. I don't care what it's doing now, I care what it will be doing when I want to sell it later.

That said, ZNGA isn't really surging. Some suckers bought on the better-than-expected news, but the stock has been trading under $5 a share for a year and a half and it's still down well over 50% off it's IPO. It's only at $3.83 right now.

Maybe these buyers know something we don't.... but I'm not going to bet MY money on that.
2013-10-25 04:34:15 PM  
1 votes:

rumpelstiltskin: Jackpot777: So far this year, a return of 9.24% just because the rising tide. You miss out on dividends, but the returns are higher.

Higher than what? Do you know what the S%P 500 has returned YTD?


If it's gone from 1426 to 1695, that's about what, +18%?
2013-10-25 04:16:02 PM  
1 votes:

Jackpot777: So far this year, a return of 9.24% just because the rising tide. You miss out on dividends, but the returns are higher.


Higher than what? Do you know what the S%P 500 has returned YTD?
 
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