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October 17, 2008

Stock trading meets fantasy football

Posted: 11:13 AM ET

The recent financial crisis has sent the stock market careening up and down like a ride at Coney Island, unnerving brokers and casual investors alike. It’s also boosted membership on UpDown.com, a Web site that gives people $1 million in imaginary money to invest in the market risk-free and compete against others’ virtual portfolios.

Stock market freaking you out? You can "invest" $1 million in virtual money online.

“We’ve seen a huge spike in traffic,” says UpDown CEO Michael Reich, who founded the Boston-based site last year with two other fellow Harvard entrepreneurs. “Times have really changed. It’s really important now to understand what’s going on with your money.”

UpDown’s 90,000 members are mostly young and overwhelmingly male. About half of them are real-life investors.

“There are definitely people who use the suite as a practicing environment alongside their real portfolio,” Reich says. “They use it to test strategies they might not feel comfortable doing in the real world.”

UpDown is similar to other sites like Marketocracy.com that recruit investors to manage virtual stocks. What makes UpDown.com different, however, are its social-networking components – there’s an UpDown page on Facebook – and the fact that the site pays prize money weekly and monthly to its top-performing investors. No wonder CNBC has described the site as “fantasy football meets the trading floor.”

Membership on UpDown is free; the top prize to date has been $3,701, although most winners earn much smaller amounts. The site so far has paid out more than $100,000 to its members, says Reich, who hopes to turn a profit through advertising and eventually create a hedge fund that outperforms the S&P 500.

So far the site has produced its share of savvy and not-so-savvy investors. Some UpDown members have lost their virtual shirts. One parlayed his initial $1 million into almost $60 million, while another has earned more than $51 million so far.

Of course, it’s easier to be bold when you’re playing with Monopoly money instead of watching your real-life retirement fund shrivel before your eyes.

“If you’re doing that great [on UpDown], you probably took fantastic risks,” Reich says. “We don’t necessarily consider those people the best investors.”

- Brandon Griggs, Tech Section Producer, CNN.com

Filed under: Internet


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Larian LeQuella   October 17th, 2008 11:23 am ET

At least they don't depend on astrology or some such nonsense for their strategy!

http://blogs.discovermagazine.com/badastronomy/2008/10/16/astrology-and-the-market-no-wonder-it-crashed/

I guess that since this is on the internet it goes in the Sci Tech blog section, but I'd much rather see something like this: http://jdem.gsfc.nasa.gov/general.html This is some cool stuff.


Franko   October 17th, 2008 11:40 am ET

Riding a tricycle is safer.
Good practice for any stock trader
From booms to crashes, cannot loose,
Government bails you out


Larian LeQuella   October 17th, 2008 12:23 pm ET

At least these guys aren't using astrology or some other such nonsense. 😉 Just check http://blogs.discovermagazine.com/badastronomy/2008/10/16/astrology-and-the-market-no-wonder-it-crashed/ for what I am talking about.

While this is about stuff that happens on the internet, really not a whole lot of science attached to it. Hey, what about that "Joint Dark Energy Mission" page? Now that's something to report on.


Franko   October 17th, 2008 1:00 pm ET

Random walk or not? PigGod or BullDog ? Offerings to which one ?
Random walk distance increase as square root of direction changes.
The problem is, the direction is unknown. Same equation for error expectation


mary cassetta   October 18th, 2008 8:12 pm ET

friday night i heard robt kennedy jr. say palin wanted to disengage from the u. s. a. along with other people from alaska when he was rudely interupted by reagon reagon would not stop talking. when kennedy tried to to talk time ran out i would like to know what kennedy had to say and if this is true i believe its worth looking into


campton-online stock trading   October 20th, 2008 8:20 am ET

Really it is in the bad situation what makes it to come at high position, we have to wait and see.


Franko   October 31st, 2008 2:05 am ET

"we have to wait and see."
Opportunity every second. Buy, Sell, Let it Ride
Just have to know, when the Dow(n) can be a portfolio Up.


Astrologer in Delhi   April 23rd, 2010 7:16 am ET

very good prediction about organisation have been given.


Yuir   November 10th, 2012 2:19 am ET

It's a real pleuasre to find someone who can think like that


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