I've always wondered about this thing: since the shares' value depend on the demand, if you buy a super-dooper shit-ton of shares in one day, wouldn't the value raise substantially? And then you can simply sell them the other day, and here you go with easy money?

Yes, it's called insider trading: http://en.wikipedia.org/wiki/Kim_Schmitz

Thanks for that: it always feels nice to know one of our pseudo-theories ended up being true. :3

No, its called Short Selling. Insider Trading occurs when individuals use privileged information the public does not have access to as a basis to buy stocks. So for example, if a google employee finds out GoogleCrack will come out December 28, so he buys a ton of stocks on December 27th, and then sells December 29th, that is considered insider trading. As such, short selling is usually indicative of insider trading, but they are different. Short Selling is legal (in the states), but can be abused and can be fraudulent.

Also, a normal person cannot buy a 'shit ton' of stocks - stocks are shares of the company, and a company must have 51% ownership at all time. To own otherwise means they're selling the company to someone else - they are turning over control. One entity must own by itself 51%. Which is why its such big news when someone buys a huge share - and what they mean when they say "company xyz sold for these monies."

As long as its public. Private companies are another issue.

There are lots of public companies that don't have a single owner that holds > 51% of stock.

Also it's not "short selling", it's "pump and dump": http://en.wikipedia.org/wiki/Pump_and_dump

I linked to Kim Schmitz because he actually did exactly what payne was talking about, and was convicted of insider trading.

Why would a company give up 51% of their company? They lose control of the company - they no longer own the company. You better hope that if the largest shares are less than 51% a person that its split among very few people at very high percentages and all of those people are incredibly invested in the company's success. You don't just sit and wait for a profit when you buy stocks, especially that many - you are responsible for the voting rights that comes with that many shares. You hold the company in your hands. Tell me what companies do not remain 51% of control in one single entity or person. US company.

Its not pump and dump - he is not actively spreading rumors about the company. If he bought a ton of Google, and was able to make rumors of GoogleCrack look valid (even though it doesn't exist) that's Pump and Dump.I read the article on Schmitz and I don't understand why its called Insider Trading, unless Insider Trading in Germany has a much broader or vaguer term, as what he did (buy shares, distort prices with rumors, sold before rumors could be verified) is pump and dump. Unfortunately all subsequent articles on Schmitz refers to him being involved with insider trading, but nothing actually says "he used validated trade secrets to make purchase decisions." He didn't have the money to buy into the company - therefore he propagated rumors to make a profit.


That's securities fraud - not necessarily insider trading. I don't even know why we're discussing this. O.o

When does the game start?

For starters your questions is wrong. You should be asking "why would the owners of a company give up more than 49% of their own company?".

The answer is: you don't need a majority holding in order to control a company. You may also simply desperately need the money and so choose to sell more. You might sell a controlling interest to someone else as part of a larger deal. When it comes to selling your company, if you sell a controlling interest you can earn a premium on the sale price than if you just sold a minority stake.

Actually it didn't take very long to do this at all: Wal mart. http://www.wikinvest.com/stock/Wal-Mart_(WMT)/Holdings_Major_Shareholders

You can see the Walton family hold between them approx 43% of all shares. There are no other single shareholders that hold greater than 5% of the shares.

Edit: Seems you can find out the shareholding of any major company fairly easily. The largest single shareholder in IBM has 5.5% of the shares. Microsoft 'insiders' hold 11% of all shares. The largest single shareholder in google has 6.79% of shares and 'insiders' have 1%. Largest single shareholder in Apple has 5.54% of shares and 'insiders' hold 1%. Seems like Wal Mart is really the odd one out with 43% being held by the Walton family.

http://finance.yahoo.com/q/mh?s=MSFT+Major+Holders

Here's some other relevant wikipedia articles:
http://en.wikipedia.org/wiki/Minority_interest
http://en.wikipedia.org/wiki/Controlling_interest


First you say it's not pump and dump and then you say what he did is pump and dump?

Post has been edited 1 time(s), last time on Dec 14 2011, 12:06 am by Lanthanide.

I'm in, I'll be active till it's over.

Quote from rayNimagi

When does the game start?

Already did...

Quote from poison_us

For clarification, that means the first actual stock market day will begin on the 13^th.

Yo poison, if I, say, bought some cocacola shares, do you then place them on the board and adjust share price accordingly? Or are you basing prices off actual share market prices? Like, are you using your own separate virtual stock market made up of anything the players buy? Or do you merely keep track of who owns what stock and current real life prices of stock?

Didn't notice this before, but since I'm on the West Coast, can you extend the stock market hours by several hours or make it start 1 hour earlier poison? The time that I usually get on on this end is like 9:30 PM EST

GENERAL NOTICE: I removed the section dealing with popular stocks, so it's up to you to figure out what stocks you'd like, rather than saying "oh, X is doing good, BUY ALL THE SHARES".

Quote from Jack

Yo poison, if I, say, bought some cocacola shares, do you then place them on the board and adjust share price accordingly? Or are you basing prices off actual share market prices? Like, are you using your own separate virtual stock market made up of anything the players buy? Or do you merely keep track of who owns what stock and current real life prices of stock?

Real life prices, what SEN member/company owns how much/what stock, etc. In short, it's based off of real-life stock, without adjustments.
Also, shares are not publicly revealed, only change in net worth.

Quote from Raitaki

Didn't notice this before, but since I'm on the West Coast, can you extend the stock market hours by several hours or make it start 1 hour earlier poison? The time that I usually get on on this end is like 9:30 PM EST

I can, but I won't. I'm sorry, but it states "Stock market hours are from 9:30am to 4pm Eastern Daylight Time." I know that's not a huge range, but you can always use Limit Orders and other means to buy/sell stocks.

You forgot to add me to the rankings




Post has been edited 1 time(s), last time on Dec 14 2011, 4:44 am by rayNimagi.

Aaaw Ray wants to appear between the 2 most awesome members of SEN <3

Oh, I didn't realise this started.

Quote from rayNimagi

You forgot to add me to the rankings

I only add people I like

EDIT:
Also, you lied about where you should be placed...

EDIT2:
General note: It hasn't effected anyone as of right now, but if you set a Limit Order below the current price of a share and say you want to buy it, it must either reach the set price or drop below it before the Limit Order is completed. I am also accepting ranges for Limit Orders, but they must be within $1.00 of each other. Additionally, some conditions can be added, which will be listed in the OP shortly.

Post has been edited 2 time(s), last time on Dec 14 2011, 4:33 am by poison_us.

Schmitz pump and dumped. Payne is NOT doing pump and dump, is what I'm saying.

Fine you might be right about percentages but 11% of a company is still quite a few shares - shares no normal person can buy on their own.

And you have to be able to find information on traded stocks easily - its the law.

A pump and dump scam doesn't require that the person doing the pumping must spread rumours or lies about the stock increasing in price. Simply purchasing enough of a thinly tradeed stock quickly enough (or over a sustained period) can be enough to attract day traders and others looking to also capitalise on the stock price increasing. The culpability behind a pump and dump is the intent to push the share price higher than is really justified and sell your cheap stock at the peak before other people can get out; spreading lies and rumours greatly facilitates this but it is not required.

Definitely, for large corporations such as I listed there would be very few people capable of individually owning upwards of 5% if they didn't initially own the stock. Anyone who could afford to own that amount of stock would know better than to invest that much into a single company anyway.

I'm a little dubious of the figures though, because I know the heads of google and Steve Jobs paid themselves $1 salaries and the rest of their wealth was tied up in stocks and stock options. But those figures showed that only 1% of all stock was owned by 'insiders'?

More precisely the law is that the information has to be published publicly, not that it must be "easy" to find. I was expecting to have to trawl through annual statements to find the major stockholders information.

Can we keep the discussion that is only loosely related to the game out of the game's thread?