21–26 of 26 posts
Great idea - trying to get my feet wet with stocks again (Played with them briefly, with minor profits during school) and this seems like a fun way to give it a go. Curious: what do you use for email notifications for signups and other transactions done on the site?
To better prepare for my comments, let me start with a few facts most investors don't know. (For the impatient, there's a TL;DR at the end).
1) The stock market is not infinitely resilient; the price of a security does respond to investors' actions, as per supply-demand.
2) The price of a stock is not a random, meaningless number that keeps going up and down in funny ways; it actually measures the market price of the company (aka 'market cap', which is roughly equal to the number of shares times the share price).
3) The market price of a company is a very, very important barometer for both the company and the overall economy; to name a few, decisions for M&A (mergers and acquisitions) by other companies are based on such numbers, as are lending and investment decisions by banks.
4) For a lot of companies, the vast majority of their shares are traded/held by individual investors like you and me (as opposed to institutional investors, like pension funds, college endowments, mutual funds, etc); for the curious, you can check out the quantity 'institutional ownership' percentage of a company using your favorite stock quote tool (e.g. Google Finance).
An important corollary of the above facts is that, collectively, individual investors like you and me have an enormous power in driving up and down the market prices of public companies. Consequently, if most investors base their buy/sell decisions on criteria other than company valuation, it is likely that their actions will be doing a serious disservice to the market as whole: market prices of companies will no longer reflect the company's value (see below), and will instead reflect whatever is it that investors based their decisions on (such as the phases of the moon, whether the company is being hyped up in the media, amazing little charts that try to predict what the market will do next, etc).
Somehow we've got to an unfortunate place where many companies and publications incentivize investors to think in terms of "what will the market do", "let's ride this climbing wave", "don't be the last sucker to leave this stock", etc, instead of asking the simple question "is this company over- or under-priced?". This is bad for the market, bad for the economy, and consequently bad for investors.
I hope these words will help you reconsider the direction you're heading with StockYoyo. We need tools that empower investors to make more educated decisions, and not more "go-with-the-flow" services.
Check out Trefis.com for a step in the right direction. (DISCLAIMER: I am not by any means affiliated with them).
May I recommend the following literature:
- Irrational Exuberance, by Robert Shiller (For a gentle introduction on how collective misguided investment can lead to bad things)
- Value Investing, by Bruce Greenwald et al (For a gentle introduction to value investing)
- Security Analysis, by Graham and Dodd (To learn from the masters, using good old English from the 30s)
TL;DR: Services that treat the stock market as a gambling machine ("will it go up??") are doing harm to the market and the economy. Stock prices have a purpose and a meaning, and the market is suffering from the ill-advised actions of investors, who are victims of services that incentivize trades based on things other than company valuation, such as silly technical indicators, or popular consensus on whether a stock is going up or down.
The game mechanics are a good start, but you need to find the sweet spot between where you are and sites like updown.com.
I agree with an earlier commenter that putting things in terms of beating the S&P 500 is a good reference. Your current focus on up/down this week is a little short sited for most investors. I know you need to recurring traffic, but I think you may have abstracted too much from how investing decision are actually made.
If you had tokens that could be placed on stocks and won by beating the S&P; a weekly leader board of who made the most tokens, and positions in the company where awarded to who made the most/least tokens from that company.
Hey guys, I was there for the demo yesterday. I wanted to talk to you but I had to leave early due to a prior commitment. I hope you'll take the comments below as constructive criticism. To better prepare for my comments, let me start with a few facts most investors don't know. (For the impatient, there's a TL;DR at the end). 1) The stock market is not infinitely resilient; the price of a security does respond to inv…
Our rating system actually has an internal pricing mechanism which is designed to drive the ratings toward zero and prevent piling on behavior. If you just follow the crowd you won't do well as a real investor and you won't score well on our site.
Judging by the feedback we've been getting that's not nearly as obvious as it needs to be and we're trying to figure out how to best show that.
I also saw your demo at the HNDC meetup last night - nice job, and kudos for being brave enough to get up in front of a room full of critics. Some feedback: - Without seeing the demo, I'm not sure I would easily get what the site is about from a quick glance at the home page. You have some nice wording -- "A free and enjoyable way to learn about investing" -- but it's part of a scrolling animation and doesn't jump ou…
I made the comment at HNDC last night that "Are crowds wise? That's arguable. But it definitely moves in herds." The value of a well executed stock "betting" game is that, since what is being wagered is of little or no value compared to an actual market position, the herd may reveal it's intentions in the game before a similar movement is noticeable in the actual market. For this to to be true, though, two necessary,…
Great idea - trying to get my feet wet with stocks again (Played with them briefly, with minor profits during school) and this seems like a fun way to give it a go. Curious: what do you use for email notifications for signups and other transactions done on the site?
Right now we're not doing anything special. We just send the emails from the server as we need to. A lot of the emails are set up as nightly jobs which we queue up in a DB before we send.
I asked because I'm the Product Manager of PostageApp, and we specialize on those sorts of emails. Let me know if you'd be interested in giving our app a whirl, it takes the headaches of deliverability out of your hair. :)