Nintendo Shares Plummet After Investors Realize It Doesn't Actually Make Pokemon Go (theverge.com)

Sam Byford, reporting for The Verge: Nintendo shares have skyrocketed since Pokemon Go's release and instant transformation into global cultural phenomenon, but they fell dramatically today after investors realized that Nintendo doesn't actually make the game. Nintendo put out a statement after the close of trading on Friday pointing out that the bottom-line impact will be "limited" as it only owns 32 percent of The Pokemon Company, and that revenue from the game and its Pokemon Go Plus smartwatch peripheral have been accounted for in the company's current forecasts. Pokemon Go is a collaboration between The Pokemon Company and Niantic Labs, the developer who previously created the similar AR game Ingress as part of Google. This apparent revelation caused shares to plummet in Monday trading, with the stock dropping 17 percent at one point, representing about $6.4 billion in value; as Bloomberg notes, Tokyo stock exchange rules prevent share prices from moving more than 18 percent in a single day.

Comments

Niantic Sux

[Sir_Eptishous]

There, I said it.

Re:Niantic Sux

[Anonymous Coward]

It's got close ties to CIA, even the guy who started CIA's inQtel is on the board. I'd stay away from pokemongo but that's just me.

Re:Niantic Sux

[Shortguy881]

But I got "minor text fixes" today.

Re:Niantic Sux

[JustAnotherOldGuy]

I'd stay away from pokemongo but that's just me.

"Pokemongo only pawn in game of life."

Re:Niantic Sux

[Adriax]

More than my previous games ever got for updates.

Re: Niantic Sux

[WeezulDK]

Uhhhhh.... damn fine trolling. I applaud you.

"Business People"

[Anonymous Coward]

They're so stupid, lol.

Re:"Business People"

[Anonymous Coward]

If the Business and Economic sector weren't filled with stupid people; and economics and business management education even in the top Universities weren't filled with bad teaching (either by design or by pure stupidity) and too much philosophizing and misinformation,
we wouldn't be having cycles of economic crisis constantly happening. The worst is the education part, because people put more credence on ideological and theorizing bullshit rather than complex situational analysis (because following a preferred guidebook as if it were a holy book is easier than actually turning on your brain).
This is a perfect example of that, business and economic "experts" choosing guidebooks over analysis.

Re:"Business People"

[jellomizer]

The stock market isn't rational. It never was.
A company lays off people the stocks go up. Not because the company is restructuring to something new, but because that is what people are told is how it works. Layoffs raise the stock prices. So you hear about layoffs you run to try to get the price before it rises more.
 

Re:"Business People"

[Anonymous Coward]

So much for the efficient market hypothesis, eh?

Re:"Business People"

[K. S. Kyosuke]

Would that be a sufficient condition? It's not like only business college graduates are influencing the economy, most of the economy is about (business-)laymen doing things.

Re:"Business People"

[Anonymous Coward]

Marxism can't come fast enough for me. I really hate this fucking planet.

Re:"Business People"

[chipschap]

The stock market is insane. I never understood why the market would shoot up or down in a matter of hours based on some transient event. I blamed it on the stupidity of traders and their shortsightedness. That isn't completely wrong but then I read about our favorite people, hedge fund traders, having to make large short-term profit to stay alive. (It would be better if they all disappeared, I think, but that's another discussion.)

Re:"Business People"

[Anonymous Coward]

Well, I won't dispute the market is insane, but the huge money is made on short-term variance ("derivatives"), not long-term tendencies. So, the more it floats, the more money "the right people" makes.

Which actually means the market is a travesty that should be replaced by something else that only operates in the long term, but there you have it.

Re:"Business People"

[Anonymous Coward]

Marxism won't save you. Try a noose.

Re:"Business People"

[ShanghaiBill]

A company lays off people the stocks go up.

Layoffs are a sign that a company is finally getting a grip on out-of-control expenses, and they usually happen long after they are obviously needed. The stock rise would only be irrational if layoffs did not result in rising profits, but they usually do. If you really believe investors are irrational, you can short the rising stock and get rich when it collapses. When that happens, please come back here and post a picture of your yacht.

Re:"Business People"

[diamondmagic]

What in the world do you think a stock price means in the context of "rational"? The price of a stock is the last price that the stock was traded for.

That is, if the price goes up or down, that means that someone actually owned shares, and sold it to someone else looking to buy. Why would someone want to buy a stock? A stock is a share of ownership, including the capital owned by the company (machinery, contracts, and IP), plus the expected payouts to the owners (shareholders) over the course of the company. If one of the company's brands becomes more valuable (for licensing opportunities), or if they invest in a new line of factories, or if they don't have anything better to do than pay out massive dividends, it makes sense that the value of the company -- and therefore the trade price of the shares -- would go up, too.

If you think you can do so much better than these individual traders making what you clearly think is such a boneheaded decision, then why not buy or sell some shares yourself?

Re:"Business People"

[shaitand]

Or you can not short the stock, you can buy options instead. Those options will be incredibly cheap because the market is most likely to go the other way. Using this strategy you can be wrong many times and get a big payoff that time you are right.

This is how you exploit the market. If looking at this history and financials of the company the layoff looks like desperate flailing before the fall you can target your strategy more specifically and have a much larger yacht.

Re:"Business People"

[jellomizer]

In some ways but it does correct itself.

The thing is an unregulated market will correct itself but it will experience massive highs which everyone will love than massive drops with could put people in the poor house or dead. So if unchecked people could be putting a lot of money in a failing business until it fails, once it fails it had corrected all the over investments.

However that is economic theory. Real life has real people who need to make it in the world. So there needs to be a moderating force. Regulation when used as a moderating force is quite handy, however it needs to allow some risk in the markets as risks allow wonderful successes just as it can cause massive failures. Communism and similar economics, while prevent people from starving on the street, it also puts the country in a time bubble where there isn't much progress over they years.

So the real question is where to set the dial on control. Too tight you cause your culture to stagnate, too little there is high chance of disastrous risk.

I expect the zone has less regulations than most of Europe but more regulations that the US has.

Re:"Business People"

[Anonymous Coward]

You won't be saying that when people try to take your home and you have to escape in the night to avoid being killed.

You see, some Marxists are just more Marxist than you... and I suspect you'll hate the planet even more if that day comes.

Re:"Business People"

[Anonymous Coward]

You won't be saying that when people try to take your home and you have to escape in the night to avoid being killed.

You see, some Marxists are just more Marxist than you... and I suspect you'll hate the planet even more if that day comes.

I don't have a home. I wish I did, but I don't.

And yeah, I hope for global Marxism _every day_.

Re:"Business People"

[JustAnotherOldGuy]

The stock market isn't rational.

^^^ This is the single most important thing you can learn about the market if you intend to invest in stocks.

The market isn't rational, it has virtually no predictable cause and effect, and it's subject to the whims of forces beyond anyone's ability to forecast.

Re:"Business People"

[GreatOldOne]

Reminds me of an old MAD magazine joke. I think it was a businessmens hall of fame. There was one entry for a guy who made a fortune selling Studebaker stock after he started a rumor that they had only shut down for several years for "retooling". He then lost a fortune buying Studebaker stock because he had heard a rumor that they had only shut down for several years for "retooling".

Re:"Business People"

[Anonymous Coward]

You won't be saying that when people try to take your home and you have to escape in the night to avoid being killed.

You see, some Marxists are just more Marxist than you... and I suspect you'll hate the planet even more if that day comes.

I don't have a home. I wish I did, but I don't.

And yeah, I hope for global Marxism _every day_.

Maybe you should try what most people do and, you know, get a job. They'll find something for you under global Marxism, anyway, and you're not likely to like it since all you've done is sit around all day waiting for someone else to take care of you.

Re: "Business People"

[Anonymous Coward]

neither do you

Re:"Business People"

[angel'o'sphere]

Hedge fonds are usually extremely long term fonds.

Re:"Business People"

[angel'o'sphere]

I don't know who gave this analogy:

The stock market is like a bet on the outcome of a beauty contest.

You see all the beauties, and probably can easy pick your favourite, however: you have to bet whom the jury will choose.

Betting who the jury will choose, is a complete different thing than deciding which is the most beautiful or agreeing with friends at a table about the three most beautiful ones.

Re:"Business People"

[Anonymous Coward]

A company lays off people the stocks go up.

Layoffs are a sign that a company is finally getting a grip on out-of-control expenses, and they usually happen long after they are obviously needed. The stock rise would only be irrational if layoffs did not result in rising profits, but they usually do. If you really believe investors are irrational, you can short the rising stock and get rich when it collapses. When that happens, please come back here and post a picture of your yacht.

Layoffs are usually a sign a company will collapse in the not-too-distant future, because management doesn't understand that in order for a business to function, it needs employees

Re:"Business People"

[Anonymous Coward]

You have an internet connection, so no, you don't hope for Global Marxism.

Re:"Business People"

[Anonymous Coward]

I never understood why the market would shoot up or down in a matter of hours based on some transient event.

It's because the stock holders are the owners of the company, and the price is how much they think they will earn over the lifetime of the company (minus the interest, as that money comes in the future). The news suddenly changes the future outlook of the company, and causes the price to change a lot.

Consider the following analogy, which may make more sense to you.

Imagine the most cliche, heartless, gold-digger girl trying to marry a rich husband. You have a boy who has a 4.0 GPA who has applied to Harvard, so she has a value of his lifetime earnings (say... $1 million USD). The very day he gets his acceptance letter, suddenly he's going to Harvard, so she immediately changes her estimate up (say... $5 million USD).

In contrast, imagine instead he gets rejection letter after rejection letter. After the very last rejection letter hits, now she suddenly drops her estimate (say... $500k USD), because he's not going to college and probably be doing something less profitable in the future.

In both cases, he's just a smart as he was the day before, he's just as talented as the day before, but some small piece of news dramatically affects the long-term earning potential, and thus how much she thinks this boy is worth.

Put in the perspective of this recent news, my expectation is that the release of Pokemon Go was the signal to the market that "not only is Nintendo willing to branch out and go into the huge mobile market, they know how to do it well because they made this amazingly popular game" (in other words, "this boy's going to Harvard, I should marry him!"). This market correction is, "Wait, it wasn't Nintendo, it was another affiliated company, they have only moderately changed their market position, I overreacted" (in other words, "oops, that letter was addressed to his brother, maybe I should rethink that marriage").

Re:"Business People"

[Anonymous Coward]

You're welcome.

Re:"Business People"

[Anonymous Coward]

A company lays off people the stocks go up.

The rationale behind this is simplified assumption that the efficiency is going to improve (and profits as well, which are bound to the real value of stock (that nobody is really able to estimate)). Now of course this simplified assumption relies on perfect management which is not really realistic thing to assume. Also, some CEOs had badly placed short-term incentives that allowed profiting from a bubble before it was found out that the layoffs actually just crippled the company to some extend.

Not because the company is restructuring to something new, but because that is what people are told is how it works. Layoffs raise the stock prices. So you hear about layoffs you run to try to get the price before it rises more.

Now you're more or less at a crucial point here: the collective behavior. The sad thing is that if you can estimate such collective behavior, you have possibility for profitable arbitrage by buying at the beginning of markets reacting while it's still on rise. And this feeds the bubble.

The fun fact witnessed in this particular occasion was that markets assumed that Nintendo had enough IPR to gain profits from Pokemon Go and later "found out" (read: got new assumption) that its stake wasn't that high after all.

Re:"Business People"

[Anonymous Coward]

A short time ago a paper held a contest, the pitted the performance of managed investment funds, some school children and a cat against each other. The cat won.

Re:"Business People"

[Anonymous Coward]

My favorite example of this was an HDD/Memory maker just like, last month, from a story here on /. of all things. Their profits went up, their sales went up, and they fired a bunch of people. Their stock went up.

Logical conclusions:
A. There were far too many people working their before and the managers are dumb enough to have let useless people hang on for years.
B. The managers just fired a bunch of people they might have needed to help their sales keep increasing so they can cash out their stock while they can.

If it's A, the stock shouldn't go up, if it's B, then it really fucking shouldn't go up.

Re:"Business People"

[AK Marc]

Layoffs increase profitability. It may not make sense to you, but there is some logic there, even if flawed. And since layoffs increase stock price, you should buy when you hear, to not be the last on the rising tide.

Re:"Business People"

[AK Marc]

That you can't understand doesn't make it insane. It's logical and predictable. And yes, a bit crazy.

Re:"Business People"

[farble1670]

Layoffs increase profitability.

They increase short term profitability, only because operating costs go down. And of course, if you reduce force, you are less poised to execute so it's *only* short term since next quarter your deliverables will again be scaled to your workforce.

Even if you look at it like the company trimming the fat, the fact they are structured to allow the fat to develop in the first place is a bad thing. How many companies come back from a "reduction in force" to become profitable? Some do, most don't. It's usually a sign they are circling the drain trying to make themselves more attractive for a buyout.

And since layoffs increase stock price, you should buy when you hear, to not be the last on the rising tide.

And unless you are dealing with insider information, you will be the last to hear. The individual investor is the last to know. The sharks have already feasted.

Curious if you bought Cyanongen, Inc (or whatever it's called)?

Re:"Business People"

[Anonymous Coward]

Ah yes, Marxism, the philosophy cooked up by a bourgeoisie asshole who never worked a day in his life, which has never actually been applied because of its abject failure to account for human nature. I hate business people (or, as they're more appropriately called, "cokeheads with personality disorders") as much as the next guy, but if you think Marxism would prevent them from slithering into similarly-destructive positions of power, you don't understand it as well as you think you do.

Re:"Business People"

[slimjim8094]

This is the Keynesian beauty contest:

It is not a case of choosing those [faces] that, to the best of one's judgment, are really the prettiest, nor even those that average opinion genuinely thinks the prettiest. We have reached the third degree where we devote our intelligences to anticipating what average opinion expects the average opinion to be. And there are some, I believe, who practice the fourth, fifth and higher degrees.

Re:"Business People"

[AK Marc]

Curious if you bought Cyanongen, Inc (or whatever it's called)?

Nope. I have evaluated trading, and have found that it's not for me. I did it for a few months, and didn't like the results. Compulsive reading, trouble sleeping, and a return of 10% per month wasn't worth it. It's so much easier to get a good salaried job and put 10-20% of that in mutual funds. The stress is zero. And the returns match the market. It might delay the date at which I can retire completely, but I'll certainly live longer.

I have a friend making good returns playing the news. Wait for something to hit the news, then buy on bad news. never sell short, never use options. The market generally over-reacts. Stay in the market in something like Google or Apple. You need the money in the market because the market is constantly on an upward trend. Because individuals are last to get the news, the reaction at the time she gets the news is bad, the others are already selling out of the falling stock. Her orders to sell her "base stock" then buy the target stock are slow. By the time she gets a buy of the target stock, it's near the minimum, and the investors start buying back in. She gets a jump as people buy back in after the dip recovers. Beats the market consistently.

Re:"Business People"

[HaaPoo]

It gets worse when you realize all the judges are drunk.

Breaking news: investors are idiots

[jxander]

The real news here isn't really about Nintendo or Pokemon.

The real news is about investors pumping billions into a company without even the most cursory research.

Re:Breaking news: investors are idiots

[geek]

The real news here isn't really about Nintendo or Pokemon.

The real news is about investors pumping billions into a company without even the most cursory research.

Gotta jump on them stocks fast!

Re:Breaking news: investors are idiots

[Drethon]

Knew I should have shorted Nintendo when I saw the articles saying their share prices sky rocketed with the release of Pokemon.

Re:Breaking news: investors are idiots

[Anonymous Coward]

The real news here isn't really about Nintendo or Pokemon.

The real news is about investors pumping billions into a company without even the most cursory research.

Gotta jump on them stocks fast!

Gotta buy 'em all?

Re:Breaking news: investors are idiots

[TFlan91]

This. A lot of money was still made.

Re:Breaking news: investors are idiots

[Anonymous Coward]

The real news here isn't really about Nintendo or Pokemon.

The real news is about investors pumping billions into a company without even the most cursory research.

Investors, by definition, would have sought enough information to know this. The trouble is with the traders, including the automated algorithms that trade based on news wire feeds.

Re:Breaking news: investors are idiots

[madwheel]

Even by knowing the stock was super inflated, you could have still made money and pulled out once it starts to drop off. Some people just rode the wave to make money and waited for something like this to happen. They're still coming out with a good ROI either way.

Re:Breaking news: investors are idiots

[fustakrakich]

Not the ones that cashed out. They knew what would happen. Deciding when was the tricky part. All these unicorns out there might crash the entire market real good this fall. It's the new "sub-prime" thing. Here's lookin' at you, Uber..

Best to get out in AugustSeptember and reenter in December/January to pick up the pieces real cheap. Even if the market doesn't crash, it will take its usual election year dip, so there's still money to be made.

Re:Breaking news: investors are idiots

[Anonymous Coward]

The stock price rose after the stock price rose. It plummeted after it plummeted. Everything else is conjecture.

Re:Breaking news: investors are idiots

[Major Blud]

The real news is about investors pumping billions into a company without even the most cursory research.

I wouldn't necessarily call that news....did you see how much Theranos was valued at just under a year ago, before it came to light that they didn't have anything revolutionary?
https://science.slashdot.org/s...

That $9 Billion valuation was given by Forbes.....not just a bunch of day traders buying up stock. If a "respected" voice in the financial industry can get it that wrong, I don't expect John Q Public to do any better.

Re:Breaking news: investors are idiots

[bobbied]

Short now dude... I'm guessing they will shed another 18% once the retail investors find out the stock just tanked and their 401k's just took a hit..

Wana make even more, quicker, with less investment? You should have considered options when it was on the way up. Could have traded a bunch of contracts which would now be "In the money" big time.. (How would you like to have a pile of PUTs at 10% under the peak price right now? They would have been cheep on Friday.)

Re:Breaking news: investors are idiots

[tnk1]

It's not really all that hard, you just have to avoid greed. You sell some as soon as it hits a predetermined point, and some more at another higher predetermined point. Remember, if goes even higher, you aren't losing money by not getting that price, you've made money no matter what. Nintendo isn't a pump and dump stock, so if you end up with some left over at the normal price when the bubble pops, you're doing just fine.

Also, when the stock plummets you have some buy orders when the market irrationally decides that now the company is completely worthless because it isn't overpriced and you make even more money by using your gains on Nintendo to buy Nintendo when everyone is underpricing it. When Nintendo's stock price levels out, you've made even more money.

You will have a problem if you're holding all your cash for that "perfect moment" where you can maximize your take. That's how you end up getting your ass handed to you in sudden downturns in price or you simply miss most of the profit. Free money is free money. Don't get greedy.

Re:Breaking news: investors are idiots

[bobbied]

Think options... This buy and sell of the actual stock idea is an antique thing. If you are trying to do these trades based on timing the market, you are missing out when trading the actual stock, but taking all the risk anyway. For the same risk, options require a lower investment up front and that means you can make more per dollar invested (better returns).

Of course.... KNOW what you are doing first, because the big brokerage houses do this kind of thing very well and will eat your lunch, breakfast and dinner if you are not being smart about it.

Re:Breaking news: investors are idiots

[bobbied]

This is why God invented options... You can, for a minimal investment, hedge yourself and make it less necessary to time the buy's and sells exactly right.

Better yet, don't get into risky positions with fast moving stocks going in either direction.... Any time you are trading on split second timing, I can assure you the big boys will always win that game. Best to not play games you are sure you cannot win.

Re:Breaking news: investors are idiots

[Pascoea]

I was thinking the same thing... That could have been a nice boost the the trading account.

Re:Breaking news: investors are idiots

[Anonymous Coward]

And an equal amount of money was lost.

Re:Breaking news: investors are idiots

[cellocgw]

Unicorns crashing are unlikely to cause a crash of the 2008 type. That happened because the housing market was out of control AND because housing "packages" were resold 6 or 8 times, thus creating an illusion of 6 or 8 times the amount of money existing. (In the sense that a classical savings&loan doubles the apparent amount of money available).

I rather doubt than a unicorn crash could even rival the first dotcom crash circa 1999.

Re:Breaking news: investors are idiots

[jellomizer]

Instead of shorting, I would suggest to just sell the stocks.
Shorting Stocks is buying against the company. So you will have 100 stocks in Nintendo and 100 stocks against Nintendo in essence 0ing your value.

Now Stock shorting is good for reducing volatility in stocks where a similar stock is expected to follow the trend, but not as much. So if both go up, the more volatile stock will still go up but not as much. And when they go down the same thing. Preventing a massive crash.

Re:Breaking news: investors are idiots

[jbmartin6]

The Twitter generation has started investing.

Re: Breaking news: investors are idiots

[Anonymous Coward]

They aren't investors, they are speculants

Re:Breaking news: investors are idiots

[randm.ca]

I'm guessing a lot of the people who wished they had shorted don't have any stock to sell, so "just sell the stocks" isn't an option and short selling makes more sense.

Re:Breaking news: investors are idiots

[Marxist Hacker 42]

Which isn't really news either, because stock brokers and investors are idiots.

Re:Breaking news: investors are idiots

[mu51c10rd]

Seems most investors don't research now anyway...it is all automated with HFT. The trick is to modify and change your algorithms before you get stuck with a bunch of stock that goes worthless fast...

Re:Breaking news: investors are idiots

[Anonymous Coward]

Unfortunately, options trading doesn't appear to be available for Nintendo.

Re:Breaking news: investors are idiots

[pr0fessor]

I don't play the game or invest in nintendo but even I already knew this. My brother pointed out that Niantic had made another game he thought sucked the day it came out.

Re: Breaking news: investors are idiots

[Anonymous Coward]

It is called retail investors, they are often a sell indication.

Re:Breaking news: investors are idiots

[StikyPad]

Unfortunately, the laws of physics still forbid investing with the benefit of hindsight.

Re:Breaking news: investors are idiots

[ShanghaiBill]

Wana make even more, quicker, with less investment? You should have considered options when it was on the way up.

Wow, that is a great idea! Do you have any other investment tips that require a working time machine?

Re:Breaking news: investors are idiots

[luis_a_espinal]

And an equal amount of money was lost.

Can't play with babies (or shit flinging monkeys) without getting some shit on you.

Re:Breaking news: investors are idiots

[Jfetjunky]

This is the scariest thing about the stockmarket. The worth of a company can be broken or made based on no information, bad information, or just plain speculation. Heck, they don't even give you free booze when you gamble with your money!

Re:Breaking news: investors are idiots

[fustakrakich]

I hope you're right. A derivatives market crash could trigger a big demand for another taxpayer financed bailout that will be much larger than the last one. *Too big to fail/prosecute* is still a thing.

Re:Breaking news: investors are idiots

[Aighearach]

Not only that, but they don't understand the costs involved. 18% sounds like easy money, but you pay a commission to buy and sell, and you also pay rent for the stock that is already priced based on the fact it might go up/down. In the end you could have made a tiny bit of money, or lost some. And if you're shorting things frequently, you'd be losing a lot of money even if you believed each of them would move 18% because you have to be right, and right on the right days.

Probably a lot of these people saying it don't even know what "shorting a stock" means; for those of you, it means you borrow the stock for fixed time, pay rent, and give it back at the end. If you sell it right after renting it, and then buy it back right before you have to return it, you can make (or lose) money. But you have to make more than the rent, which means you have to know more about the stock than the person you're borrowing it from, because they include expected price volatility in the rent. Clearly, if you're some percent smarter than the average existing investor, you'd make more with regular buying and selling than with shorting, because shorting adds overhead and you're still competing with the same other buyers and sellers over prices.

Re:Breaking news: investors are idiots

[nyet]

Or buy a put option.

Re:Breaking news: investors are idiots

[twocows]

I don't know if I'd call it news so much as a reminder of the obvious.

Re:Breaking news: investors are idiots

[Anonymous Coward]

This is why God invented options... You can, for a minimal investment, hedge yourself and make it less necessary to time the buy's and sells exactly right.

Please show us the option chain for Nintendo and how much this minimal investment will cost. We'll wait.

Re:Breaking news: investors are idiots

[Drethon]

This is why I don't actually short, or usually even buy individualy, stocks. I just crack wise about it on discussion forums. I much prefer funds and long term for actual investing.

Re:Breaking news: investors are idiots

[NotAPK]

Well said.

Watch The Big Short for more information delivered in a very entertaining format.

Re:Breaking news: investors are idiots

[Anonymous Coward]

For the same risk, options require a lower investment up front and that means you can make more per dollar invested (better returns).

Most long options expire un-exercised. That's a 100% loss.

Re:Breaking news: investors are idiots

[somenickname]

What you are describing is called "investing". What most people want out of the stock market is better described as "gambling".

Re:Breaking news: investors are idiots

[Anonymous Coward]

Why do people such as yourself post when it is clear you have only cursory knowledge about "shorting stocks"?

"Instead of shorting, I would suggest to just sell the stocks."
How would this strategy work if i don't hold the stock in the first place? Isn't that the whole reason why the "Short" order type exists in the first place (to sell something you dont have and buy it back later)?

"Preventing a massive crash"?
Shorting prevents crashes? One would think it would create "downward pressure" on the stock. This can potentially create volatility and under some situationss make a bad market worse by triggering "on stop" orders.

Isnt this why the banks asked to have their stocks put on the "do not short" list during the last financial crisis?

Re:Breaking news: investors are idiots

[bobbied]

Read the article... This stock hit the stops in Tokyo which stops trading a stock that looses 18% in one session. Read my reply, I clearly state that I expect it's going to continue to fall in the next session. You may not be able to trade the stock right now, but you CAN trade options.

But none of that matters, I was telling somebody what they *should* have done when they said the following:

Knew I should have shorted Nintendo when I saw the articles saying their share prices sky rocketed with the release of Pokémon.

I was telling them that you could make more using options than selling short with about the same risk, likely with less investment... If you are really clever, and reasonably quick about it, you can make a small fortune on stocks doing these kinds of wild swings.

Re:Breaking news: investors are idiots

[slew]

That $9 Billion valuation was given by Forbes.....not just a bunch of day traders buying up stock. If a "respected" voice in the financial industry can get it that wrong, I don't expect John Q Public to do any better.

Actually valuation numbers like "$9B" simply meant that a company claims that for the amount of money received from some sucker, the investors only got "N%" share** of the company.

In the case of Theranos, it was N~4%. Forbes (and other industry trade-press) did not give the valuation, it merely reported what Theranos said some sucker private equity firms were bamboozled into paying for a share of the Theranos dream...

Maybe John Q Public doesn't get that this effectively means the news source of the valuation was actually Theranos itself, but that's a problem with the modern generation of news consumers, they often don't stop to consider the source of their news...

**sometimes these deals are very complicated involving convertible loans, share warrants, and anti-dilution clauses, so often the valuation is inherently misleading as companies self report the figures with the most optimistic spin resulting in the smallest share of equity for the money invested (e.g, all loans repaid before they convert to equity, no share warrants executed, no dilution clauses hit).

Re:Breaking news: investors are idiots

[slew]

Which isn't really news either, because stock brokers and investors are idiots.

Actually, stock brokers are not the idiots in this scenario because they are the ones that made money on commissions because of the idiot investors want to buy shares (and they will make money again when the investors sell the shares for a loss).

As they say, look around the poker table: if you can’t see the sucker, you’re it...

Re:Breaking news: investors are idiots

[farble1670]

You should have shorted it right after you installed the app and say it was garbage. It's a real stretch to even call it a game. The user base is already declining.
https://www.surveymonkey.com/b...

Re:Breaking news: investors are idiots

[Anonymous Coward]

Uhh. Options decay in value over time if the price is stagnant and if the stock moves literally one day after yours expire you lose the full price of the option. How is that making it less necessary to time? It adds a big ticking clock you have to deal with. What you get is leverage but it's far easier to win big or lose it all.

Re:Breaking news: investors are idiots

[AK Marc]

I was telling them that you could make more using options than selling short with about the same risk

You make about the same with about the same risk. Some people prefer one over the other, but in practice, they are effectively interchangeable. Options reduce maximum loss (risk) and maximum gains. If you use options and the price doesn't change, you lose money. If you sell short, and the price doesn't change, then you don't lose money. Options are better about magnifying investments. A smaller payment for a greater potential gain. So long as you don't finance your sell short, which so many do, in which case they get closer again.

Re:Breaking news: investors are idiots

[Anonymous Coward]

To be honest, you don't need a time machine to know that Pokemon Go would be a hit among the masses.

Re:Breaking news: investors are idiots

[Aighearach]

You're still adding overhead, it costs you more than just buying and selling regularly. So if you're actually able to time price swings, you would make less money. And if you turn out to only be average at it, you lose money.

Re:Breaking news: investors are idiots

[Anonymous Coward]

"long option" is what exactly? Options are Put's and Calls. A "Put" is a contract that stipulates the holder has the right to sell a security at the specified price to the issuer and a Call says the holder can buy the security from the issuer at the specified price. I have no idea what you mean by a 'long" option.

Your point about options usually expiring w/o having been executed is true, but that doesn't mean money wasn't made, only that the person holding the contract when it expired lost money. The person who sold the option DID make money.

There are reasons why it would make sense for a trader to buy/sell options that will expire unexercised. Usually it has to do with hedging, where you are buying "insurance" to protect yourself from a large unexpected price move in a security. For instance, you may buy Puts for nearly nothing at a strike price just under the current market price for a stock which puts a floor under what you can loose by holding the stock, thus limiting your risk for pennies on the dollar. Or buy calls over the market price on a stock you think is going to tank and then sell short, knowing your risk is again capped by owning the options.

Of course, the money to be made is in trading these option contracts, where small price changes in the actual security drives changes in option prices which are many multiples bigger. Which is why many retail option traders are in and out of a position in seconds to min, and can take a few hundred dollar investment at a time and turn a tidy profit and why the big wholesale program traders can make such huge profits when their computers are faster and their algorithms are better than the next guy's.

Re:Breaking news: investors are idiots

[bobbied]

You are thinking way too one dimensional on how options trading works. There are many ways options are used.

Just doing option trading is usually only successful when you are armed with a workable strategy and that usually involves some kind of technical analysis and automation that looks for specific queues in the options chains for favorable conditions for a transaction. Such trading is usually very high frequency, and traders are in and out in seconds or min.

Mixing options into a trading strategy where you are actually trading the underplaying security is usually used as "insurance" where you can cap your risk for pennies on the dollar, but still enjoy the possible gains. (Like buying calls above the market price (which are cheap), then selling short. Or my favorite, selling calls (against the box) when I'm holding an exercisable stock option at the strike price from my employer that doesn't expire and make a few bucks with ZERO risk of loss.)

Re:Breaking news: investors are idiots

[Joce640k]

but you CAN trade options.

Only if you find a really stupid person to trade with.

Believe it or not: You can't just walk into a stockbroker and buy whatever you want. Sometimes they say "no".

Re:Breaking news: investors are idiots

[ShanghaiBill]

To be honest, you don't need a time machine to know that Pokemon Go would be a hit among the masses.

Everything is obvious in hindsight. Instead of telling us which stocks were "obviously" going to go up yesterday, tell us which stocks will "obviously" go up tomorrow.

Re:Breaking news: investors are idiots

[AK Marc]

The discussion here wasn't about using options to hedge, but to profit from a stock's fall. That you don't know the difference, or are unable to discuss it without frothing at the mouth about how glorious your strategy is, indicates *you* are the one that doesn't understand the issues.

Or my favorite, selling calls (against the box) when I'm holding an exercisable stock option at the strike price from my employer that doesn't expire and make a few bucks with ZERO risk of loss.

Yes, when you hold an infinite value option, you can hedge against any "loss" of it, for a cost. But you'd have made more if you didn't waste money on options, so it's still a risk.

SELL, Mortimer, SELL!!!! Oh, Too late :-(

[Anonymous Coward]

I told y'all that it was time to sell just as the stock skyrocketed because it would soon drop. Of course, I wish I had Nintendo stock to begin with so I could have sold it. Oh well.

Momo Play

[Anonymous Coward]

Most likely this was driven by momentum traders.

Robotrading

[Anonymous Coward]

Investors don't do due diligence and robo-traders trade based on clickbait headlines. News at 11. Moo.

Apropos of anything hipster

[Anonymous Coward]

Like Ingress, it's another "I was there in the beginning" hipster fail.

Herd

[backslashdot]

The herd realized it over the weekend and sent each other emails? How does this happen en masse? Suddenly one person realizes something that is publicly available information, and mentioned in many articles? Presumably at least *some* people knew.

Re:Herd

[Aighearach]

The news seems to miss the news, and pat itself on the back.

Nintendo "doesn't actually make Pokemon Go," they just own a significant portion of the Pokemon company. Oh, so they do own that. Oh, they don't actually make the software for the game... but they are the major owner of the company that sells the license and makes the money off merchandise.

Who is more clueless, the investors that thought this being such a huge market hit that there are Pokemon zombies on all the sidewalks would sell merch, or the reporters who can't figure out that the game itself makes less money than the brand boost? They have existing, entrenched retail presence of their merch.

Who is more clueless, the people who think that the stock shouldn't have gone up because Nintendo already included Pokemon Go in their revenue forecast, or people who assume that their forecast was realistic enough that they might have exceeded it?

I don't know if the stock is overpriced or not, or if it was overpriced at its peak. And that makes me better informed than the media on this question! ;)

idiots

[jsepeta]

Nintendo has lots of worthy IP that could be made into mobile games, using Mario, Link, etc. There's plenty of potential left at Nintendo if they simply move beyond console gaming.

Re: idiots

[Anonymous Coward]

MarioGo, oh look there's a Goomba! Jump on it!
*Jumps into traffic*

Re:idiots

[Anonymous Coward]

What you are referring to is handheld gaming, and Nintendo is already leading in it.
What you should know better however is that Nintendo is the only one who can pull off console gaming because it is the only one that focuses on family-friendly gaming for the family and the young. In puritan but less tech inclined families, such as say the hardcore Christian massive South and Central American population,
or say the Muslim populations, or say India, or say China (where iQue represents Nintendo), it's Nintendo which offers the best ideological/political/religious/ethics approved content.
So to advise Nintendo to move beyond console gaming is to advise Nintendo to suicide and abandon the specific business opportunity where it leads with an established reputation. A business opportunity that comes from the first thing you learn in management school based off the sociology and business ethics classes on configuring and analyzing business models and opportunities based on the cultural makeup of the area's population.

Re:idiots

[Anonymous Coward]

You mean, like Sega did?

Re:idiots

[ArhcAngel]

You are correct. In fact Niantic has already announced plans for Mario Kart. It's gonna be a smash hit!

Re:idiots

[Touvan]

Nintendo's position seems to be that they can keep innovating in the console space, and keep their position atop a heap of their own making. They don't want to deliver on someone else's platform, because it isn't as profitable. They are going after big long term profit, not reactionary short term profit.

No matter how many times folks at Nintendo explain this, people still don't seem to get it - maybe the same people who invest in Nintendo after another company releases Pokemon Go. Or maybe because it's a bigger gamble or bolder play, and most people are very risk averse, they can't wrap their heads around it?

Re:idiots

[thegarbz]

Yeah what idiots. They only had revenues of $4.6bn USD last year from their IP on consoles. It's incredible how stupid they are for sticking to what they know best.

Re:idiots

[Anonymous Coward]

That's a big number but how do you know whether it is a good number?

Re:idiots

[guises]

Why do people keep trying to push Nintendo into the mobile world of awful freemium games and touchscreen-only controls? It's possible that they may end up there, as cell phones continue to devour other electronics, but this would represent a loss from the gamers' perspective, as another source of quality gaming dries up. It would also mean giving 30% of their revenue to Google/Apple. I can't see why Nintendo would be in any rush to do that, and I can't see why anyone else would want them to. (Other than Google and Apple...)

Re:idiots

[Anonymous Coward]

How come there's no Nintendo version of Super Mario Bros for the phone?

Re:idiots

[Anonymous Coward]

It will have responsive tilt controls! Attach it to your steering wheel so you can play on the go!

Re:idiots

[Anonymous Coward]

How come there's no Nintendo version of Super Mario Bros for the phone?

Because Nintendo doesn't make games that suck, and they will not release a game on a platform unless it is a PERFECT platform for a game.

A touchscreen held sideways is not the PERFECT platform for a mario game. Period. A system with physical buttons is. Nintendo has an important legacy where, if a game says it is made by nintendo, you know that it takes advantage of it's hardware's capabilities, and it is fun.

The reason why Nintendo's characters are so valuable is specifically because they try not to soil their characters with poor cash grabs. When nintendo releases a game on a smartphone, it will be a game designed with the capabilities and limitations of the smartphone in mind. There will be no on screen d-pad and buttons, because clearly that game would be better served on a system with real dpad and buttons.

Re:idiots

[thegarbz]

The size is irrelevant. You need to compare that to total profit which is a fraction of that number. But the key part is that this is their core business, it is what they know best. You can't magically increase that number by going into the mobile space and expect to turn it into a profit, there are huge costs involved.That's like saying I'm an engineer today maybe I should change and be a doctor tomorrow since their numbers are better, and then ignoring the multiple years of no income due to studying at university along the way.

The point is revenues are a measure of active business. It shows that their console business is moving and there's quite a bit happening in it. The focus should be on turning that to raw profit, not betting the house on giving Google / Apple 30% of everything.

Re:vou quebrar a tua cara

[Anonymous Coward]

Oh, are you interviewing at Nintendo? Do you think they mislead you about the job? Do you really think doing something so violent to Hellena will make things better?

Re:vou quebrar a tua cara

[Anonymous Coward]

A Helena fez o que? Nao penses nela, concentre-te na entrevista. Boa sorte.

Up, down, flying around

[wonkey_monkey]

It's still 60% above what it was on 7th July... but doesn't seem to be done plummeting yet.

Just let them get Wii U Zelda out before folding, eh?

Here's something for graph fans, since there wasn't one of the share price:

http://abstrusegoose.com/191

Re:Up, down, flying around

[Anonymous Coward]

Nintendo won't be going anywhere for a long time. They've got massive financial reserves.

Re:Up, down, flying around

[Khyber]

Nintendo has been around for a very, very, VERY long time (late 1890s?)

If you think they're going anywhere, you're sorely mistaken.

Great example of a key flaw in the stock market

[sabbede]

Too much emotion, not enough reason. Excess enthusiasm and pessimism are the top causes of market instability. People got whipped up into a buying frenzy based on bad/incomplete information, and a third party (Nintendo) suffers for it.

Automated trading only reinforces the problem, since it magnifies emotionally driven market conditions.

Re:Great example of a key flaw in the stock market

[thrasher thetic]

That isn't a flaw in the market, it's a flaw in the investors. The market corrects for it by brutally penalizing those who make bad decisions and rewarding those who make good ones.

Re:Great example of a key flaw in the stock market

[Major Blud]

The market corrects for it by brutally penalizing those who make bad decisions and rewarding those who make good ones.

If only that were true....
https://en.wikipedia.org/wiki/...
https://en.wikipedia.org/wiki/...
https://en.wikipedia.org/wiki/...

Re:Great example of a key flaw in the stock market

[Archangel Michael]

Too much emotion, not enough reason.

Reason has been educated out of our system, and replaced with Emotion. Much easier to manipulate the masses is all you have to do is cry "Hate" and have a bunch of kneejerk reactionaries goosestep the same way.

These things are related.

Re:Great example of a key flaw in the stock market

[axewolf]

No, this is a great example of a key purpose of the stock market.

Re:Great example of a key flaw in the stock market

[thrasher thetic]

The market DID penalize all of those. The government bailed them out.

Re:Great example of a key flaw in the stock market

[Anonymous Coward]

Now your catching on. Keep going...

Re:Great example of a key flaw in the stock market

[Major Blud]

That's true, thanks for the clarification :-)

Re:Great example of a key flaw in the stock market

[tnk1]

I wouldn't worry, this is hardly going to put Nintendo out of business. The only losers are those who didn't understand that this was a bubble and that they needed to take their money while they could get it while it was streaking upward, because it was very soon to come straight down again.

Nintendo will bounce off of the opposite and equally emotional response to sell and be back at their usual price in a little while.

If we'd only stop bailing out the losers who make these kinds of mistakes, the market would very efficiently remove them from contention by making them flat broke in two seconds flat.

In 1929 we had stockbrokers jumping off of buildings due to an overemotional response to emotional trading that led to crappy decisions. If only we could have kept the process going to clean the gene pool of these types of brokers.

Re:Great example of a key flaw in the stock market

[Anonymous Coward]

a third party (Nintendo) suffers for it

How did Nintendo suffer from this. Stock price has only a tangential impact to a company's operating situation (such as when it wants to get a surprise large amount of money for a future effort... which doesn't happen that often). Stock prices are the effect, not the cause, of a company health.

So Nintendo started at 100%, went up to 200%, dropped to 175%... even if it continues to drop to 100% (or lower to 70%), there is no talk about them going bankrupt or subject to a hostile takeover or anything... so how do they get hurt?

Now the people who bought Nintendo stock at 200% and now are losing money... they are the ones being hurt. However, seeing how they were the ones who bought due to excessive enthusiasm, I don't have much sympathy for them. They literally chose this for themselves.

Re:Great example of a key flaw in the stock market

[Touvan]

If you think big companies and governments are truly separate, then I have a bridge to sell you. ;-)

Re:Great example of a key flaw in the stock market

[jdavidb]

You're citing government actions, not the market

Re:Great example of a key flaw in the stock market

[thegarbz]

and a third party (Nintendo) suffers for it.

Man I wish I could suffer so much that I'm still worth 50% more than what I was despite the tumble.

Re:Great example of a key flaw in the stock market

[ljw1004]

Too much emotion, not enough reason. Excess enthusiasm and pessimism are the top causes of market instability. People got whipped up into a buying frenzy based on bad/incomplete information, and a third party (Nintendo) suffers for it.

How has Nintendo suffered? I can't see how.

Re:Great example of a key flaw in the stock market

[stinerman]

Now, now. I've been told time and time again that the efficient markets hypothesis is true, and anyone who says otherwise simply doesn't understand economics.

Re:Great example of a key flaw in the stock market

[Anonymous Coward]

You're citing government actions, not the market

The government spends money, therefore the government is part of the market.

Re:Great example of a key flaw in the stock market

[Anonymous Coward]

What about his catching on?

Re:Great example of a key flaw in the stock market

[Curunir_wolf]

You're citing government actions, not the market

The government spends money, therefore the government is part of the market.

Definitely time to short THAT stock, then!

Re:Great example of a key flaw in the stock market

[Anonymous Coward]

The IRS discourages shorting the government.

Re:Great example of a key flaw in the stock market

[Anonymous Coward]

You're citing government actions, not the market

The government spends money, therefore the government is part of the market.

Definitely time to short THAT stock, then!

Government shares are called bonds.

Re:Great example of a key flaw in the stock market

[UnderCoverPenguin]

The market penalized the companies, NOT the people running those companies.

Those people had their "golden parachutes" ready so they could bail themselves out of the companies, letting the companies collapse on to the workers.

Re:Great example of a key flaw in the stock market

[khallow]

The market penalized the shareholders of the companies. And coincidentally, they were the ones making the bad decisions.

As to the "workers", nothing will come of this particular spike in the price of Nintendo.

Re:Great example of a key flaw in the stock market

[sabbede]

Point taken. Still, a lot of sloppy market players will focus on the drop, potentially stigmatizing the stock, but on the whole it should wash out.

Re:Great example of a key flaw in the stock market

[sabbede]

People are lazy and perceptions are biased. People will get hung up on the drop, some will have lost a good chunk of cash, and because nobody wants to accept that their collective action is to blame, they'll shift the blame to Nintendo. Not all players will, probably not even most, but enough to tarnish reputations. But that's the game, and Nintendo will be fine.

Re:Great example of a key flaw in the stock market

[sabbede]

Over the long term, it is. Short-term, it's a mess.

news at 11

[Anonymous Coward]

smart/rich investors set a trap for dumb/poor investors

Who saw this coming?

[dlenmn]

I'm surprised so many people didn't see this coming. The share price was totally out-of-whack with reality. I'd have shorted the hell out of Nintendo's stock (if I had money and the means to do so). Surely, someone with money did? Anyone here?

Re:Who saw this coming?

[Anonymous Coward]

Care to show me your post where you predicted this? Slashdorks love to announce the arrival of a failboat. I'm not seeing where you had some special insight into this event.

Just another big mouth proclaiming he knew the truth all along (but, you know, kept it to himself but later proclaimed he seen it coming only after it was announced).

I just love you morons.

Re:Who saw this coming?

[thegarbz]

I'm not seeing where you had some special insight into this event.

You don't need special insight to see a bubble event forming, just use the two eyes you have and apply the common sense that maybe a company didn't magically double in material value simply because a game which shows all the signs of a temporary craze is popular this week. When the stock market suddenly spikes positively for a company which hasn't announced any major new physical or tangible achievement you can always assume a correction will come. It's only a matter of time before investors actually settle on a somewhat more sensible value for stock based on long term performance.

Incidentally while you are demonstrating the inability to show thought remember that Slashdot has millions of readers and a lot of commentators. You're replying to a collective group so statistically it's almost certain that multiple people on Slashdot will have predicated pretty much every event that gets covered here.

Calling them Slashdorks just points more to your lack of education compared to the rest of the readership, many of whom actually know some basic statistics.

Re:Who saw this coming?

[Anonymous Coward]

Calling them Slashdorks just points more to your lack of education compared to the rest of the readership, many of whom actually know some basic statistics.
 
Um, bitch, not understanding that most Slashdorks don't know shit about real business is what's apparent. Calling them Slashdorks don't point out jack shit. You're just reaching to feel good about your little gaggle of big-mouthed, know-nothing cunts.

Re:Who saw this coming?

[dlenmn]

Care to show me your post where you predicted this?

You caught me AC! I didn't post it on slashdot so I couldn't possibly have thought of it earlier or discussed it with other humans (with friends last week at lunch).

I guess if slashdot is your only means of communicating with other humans, then it makes sense to believe that discussions not posted on slashdot couldn't have happened.

Mark Twain quote from The Big Short

[Doaner]

“It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.”

Pump and dump Does someone need to look in to this

[Joe_Dragon]

Pump and dump Does someone need to look in to this

Game Freak?

[Zombie Ryushu]

Isn't the Pokemon Company the company that handles Merchandising, but Game Freak the ones that create and Publish the games? Isn't it supposed to be the case that Neither of these companies directly tied to Nintendo, and Game Freak could be considered a Third Party Developer like WayForward?

Citation / Clickbait

[Anonymous Coward]

Where is the quote that says that an investor thought Nintendo owned Pokemon Go?

Alternative Headlines: Nintendo Stock drops after report it already accounted for Pokemon Go income
or
Nintendo already priced for Pokemon Go
or
Unknown information revealed (how much nintendo was making from pokemon go), stock changes accordingly (it dropped)

Btw, these kinds of headlines "Stock plummets because of X" are market clickbait. They are everywhere and they are created by people who know little, but try to attribute motivation. But they'll get more clicks with a definitive title.

But also, it's still up 60%! Even if it drops another 20%, that would still be not bad for Nintendo stock.

Re: Pokemon sucks

[K. S. Kyosuke]

Silly Trump; the Romans and the Chinese have beaten him to it by millennia!

Speculators are not investors

[Anonymous Coward]

What makes you think the majority of people buying stocks are investors? Have you not heard of speculators?
They represent a massive portion of stock traders, and they are not stupid. Plenty would have bought in simply to ride the wave and sell in a few days and make a cool 20% or more.
That hardly makes them stupid. In fact, since you don't understand how that works, they're clearly smarter than you.

Re:Speculators are not investors

[AK Marc]

What makes you think the majority of people buying stocks are investors?

Because much of the outstanding shares are held by "investment" funds, thus, one would presume they are held by investors, or those who represent investors.

Retail investors

[Anonymous Coward]

Retail investing should be banned. Unwashed masses should only be allowed to by index funds.

Re:Retail investors

[MerlynEmrys67]

Retail investing should be banned. Unwashed masses should only be allowed to by index funds.

Wow - this has to be the stupidest thing I have ever seen.
Please lets start with a few problems:
1. Please define Unwashed Masses and give a definition that will show who is in/out of the group that isn't allowed to trade
2. Please define index fund - separate an index fund from something like Magellan which is one of the larges funds in the world, but is far from an index fun

Now that we have that out of the way, explain how making choices for myself should be made unlawful? Are you going to ban the lottery that has an even lower payout? What about my 401K plan, what choices am I allowed to have in my 401K... Is this different than "retail investing"?

Re:Retail investors

[Anonymous Coward]

Unwashed masses: If you've never heard of the efficient market hypothesis or a "random walk"-> congratulations, you're it! I would be satisfied if being able to define these two terms was a prerequisite to buying stocks.

Specifically:
A bachelor's of science in Math or Statistics should be a licensing requirement.

The status quo is ignorant plebes being defrauded out of the fruits of their labor by the financial industry which makes money off the spread between buy and sell prices(among other things). Gun dealers aren't allowed to sell hand grenades to children, gas stations can't sell cigarettes to minors, yet there are almost no limits on the risky positions that an ignorant blue collar worker can buy on margin. There is no "informed consent" at play. Most retail investors can't even define the term "expected value". They are not capable of making informed decisions with respect to stock purchases.

Index fund: DOG, DJIA, S&P500, Nikkei 225, etc.

I've never heard of "Magellan" and I don't care to google it. Your argument would be stronger if you pointed out that limiting individual stock investments to retail investors would distort the market's pricing mechanisms(which would reduce pricing efficiency -> which is bad).

Re:Retail investors

[Anonymous Coward]

The status quo is ignorant plebes being defrauded out of the fruits of their labor by the financial industry which makes money off the spread between buy and sell prices(among other things).

How is this done, given a stock with a price of 10 x 10.01?

Re:Retail investors

[Anonymous Coward]

Uh huh.
And how do the constituent companies which make up indexes have their stock valuations determined?
More index funds?

Re:Retail investors

[Anonymous Coward]

Non-retail investors stupid.

Re:Retail investors

[Anonymous Coward]

"How is this done, given a stock with a price of 10 x 10.01?"

Is that ask or bid? Is it a market order or a limit order? What is the fee on the trade?

Better question: why am I arguing with you? Throw away your money. I don't personally give a shit.

The real reason is this one line:

[TheCastro1689]

" revenue from the game and its Pokemon Go Plus smartwatch peripheral have been accounted for in the company's current forecasts." Investors thought this craze and everyone playing it was totally unexpected.

Shares falling %17 after growing nearly %100, meh

[Timmy D Programmer]

A %17 pullback after doubling? seriously, that's not hardly a plummet

Is this accurate?

[wardrich86]

Did they really jump-ship for that reason? Nowhere in the game is Nintendo even mentioned. I never did understand the stock jump with Nintendo, though. I figured if anything, Pokemon Company, Game Freaks, or Niantic would be the ones that would skyrocket (assuming they're tradeable companies).

Now I'm seriously confused as to how the stock market works. Is it really full of that many idiots that just throw money at anything without doing ANY research beforehand? The only real tie that Nintendo has with Pokemon is their tie to The Pokemon Company, so why didn't people jump on those stocks?

Re:Is this accurate?

[31415926535897]

As USians, we can't buy The Pokemon Company (it's a Japanese company), and Niantic isn't publicly listed, so we can't buy it either. Nintendo is listed in Japan, but it trades here under a special stock called an ADR (American Depository Receipt) here in the US. Since Nintendo owns parts of these other companies, buying the ADR was the only way some investors could get in on the action.

As I watched the stock, it jumped initially because of the Pokemon Go news (from ~$17 to $27), then it consolidated. That actually seemed reasonable given the news. A couple of days later, it jumped again (from ~$27 to ~$37) as news spread and momentum traders wanted to get in on the action. To me, that seemed like an overreach. So now since the momentum stalled out and people want to take profits, it's turning down again.

So it takes a little bit of knowledge to know that Nintendo does stand to benefit from the success of Pokemon Go, but it takes more research to know how much. My guess is that TV news gave people the first bit without anyone doing their homework for the second bit.

I love trading and am okay at it (I make profits every year and generally beat the market on a return basis). I did not want to touch this one with a 10-foot pole. Too much volatility for it to be investing or trading--it really did turn into gambling for some people.

Re:Is this accurate?

[Viewsonic]

Pokemon is owned by three companies.

Nintendo
Game Freak
Creatures

Game Freak and Creatures are both subsidiaries of Nintendo.

They all have different roles in what happens with the IP.

Niantic is a subsidiary of Google who writes mobile games leveraging the Google Maps data.

Re:Is this accurate?

[axewolf]

I'm seriously confused as to how the stock market works

The main purpose of the market is to control the people who could use their resources to assert their interests, but choose not to because they are placated.

Basically the stock market is the main governing body of our society. It is purported to be a fair system, but it's completely manipulated by an aristocracy. It abstracts mechanisms of governance; it hides the will of the ruling class behind a smokescreen.

The lie of the fairness is what gives it power. Because the participants assume the forces of the market are "natural", they don't protest when it raids them, and when they profit, they credit themselves for their intelligence. They never realize that their success and failure is completely orchestrated through the media. They are truly brainless and unaware of themselves. The illusion/delusion of free will is perpetuated by this simulation of nature. As long as there is give and take and risk and reward, people will assume they are free. That's all it takes to exploit their instincts and bypass their critical minds and to completely dominate them.

It's the mechanism by which the retarded masses are kept in check. But it's also the mechanism by which a broken system is upheld and superior personalities are kept down in the dirt so they can't take power from the hereditary aristocracy, regardless of any improvements they would make to the economy or anything else. Only innovations that are in line with the extremely conservative and cautious interests of the ruling class are permitted. Anything that would threaten their tyranny is put down immediately.

The stock market is the death of true competition and probably the ultimate death of humanity.

Re:Is this accurate?

[MobyDisk]

I am surprised that people don't think that Niantic owns the Pokemon trademark. Take a look at the title screen. It says "Niantic <br/> [Niantic Logo] <br/> The Pokemon Company." It looks like "The Pokemon Company" is Niantic's tagline. That's not typically how a company is named.

Re:Is this accurate?

[Anonymous Coward]

Nintendo Company, Ltd. (NCL) is the owner of all Pokemon properties.

Game Freak is essentially one of Nintendo's EAD units that gets renamed when they're put to work on Pokemon games. It's a nickname with public branding to throw competitors off the scent of EAD and make it appear that there's an external dev company doing the work. Game Freak is a full subsidiary of NCL, but isn't really a company per se.

Creatures owns the artistic elements of the game, including the artwork and music. This includes the art assets from the cartoons and merchandise. They're basically the in-house NCL design and art department that is involved in Pokemon games and shows. Creatures is a full subsidiary of NCL, and again isn't a real company in the traditional sense.

But that's all in Japan. In the US, the merchandising rights and any third-party rights (that is, anything that involves anyone other than Nintendo) are all handled by The Pokemon Company (TPC). Nintendo has a US-based subsidiary, Nintendo of America, Inc. (NOA). NOA owns a 1/3 stake in TPC. They represent the NCL direct-stake in TPC. For game and art-asset licensing reasons, Game Freak and Creatures each hold a separate 1/3 stake in TPC.

So at the end of the day, NCL owns everything Pokemon in all markets. They own NOA, Game Freak, and Creatures, which all own a share of TPC.

Niantic is a former Google subsidiary. Google spun them off a couple of years ago. They merely license the Pokemon properties from TPC. The fact that they have to license from TPC in North America, South America, Europe, and Australia, but have to license directly from NCL and Creatures in Asia is why there's a delay releasing Pokemon Go in certain countries. (Niantic, having written the code themselves for Pokemon Go, likely doesn't have anything to license from Game Freak, who only "owns" the code to various older Pokemon games.)

CAPTCHA: "rocket"... is blasting off again!

Re:Is this accurate?

[Anonymous Coward]

I've never heard an American calling ourselves USian.

Fuck off with your invented language.

In other news

[JustAnotherOldGuy]

In other news, people who invest in stocks are often idiots with no clue as to 1) how the market works, 2) who makes what, or 3) why a stock price goes up or down.

I'm only surprised they weren't calling their stock brokers and telling them to "Get me 5000 shares of something called 'Pokemon!'"

Ride the wave, bail before it crashes.

[foxalopex]

I don't think folks on the market were idiots, at some point due to market hype some folks hopped on hoping to ride the wave and to jump before it crashed. I think a lot of folks knew that it was way overvalued but decided to buy into it in the hopes to catch the wave. Some high speed trading systems that caught it early probably managed to make some decent money before it started to collapse again.

Re:Shares falling %17 after growing nearly %100, m

[Anonymous Coward]

Except that the plummet was stopped due to exchange rules. Tune back tomorrow.

Re:Shares falling %17 after growing nearly %100, m

[Anonymous Coward]

Japanese Stock Market will not allow trading on a stock that loses more than 18% in a day (I believe that's the cutoff). So, yes, this is as much as plummet as one day will essentially allow. Likely more drops to come, and a few spikes, as the price stabilizes.

Good guy Nintendo

[tyggna]

I realize there's the enlightened self-interest in play here, but this is really a kind move on Nintendo's part.

1) There's a huge increase in valuation for their company.
Nintendo employees (especially VP and C-level) could make a lot of money off of this fact. Ultimately, that money is coming from a bunch of investors because these guys get paid in stock and stock options.

2) The investors made the wrong investment, so they'd either lose or gain money based on a false premise.
So, Nintendo is being the nice guys here by setting them straight. Their execs could've just cashed all their stock options right now and ran. Instead, they issue a statement helping to set these investors straight before they lose any more. It saves Nintendo's reputation as a long-term investment, but they also built a good will with investors.

3) Nintendo didn't need to do this
They have the cash reserves to essentially self-fund all their projects. They could've burnt through good will in the short term and made a ton of money, but they didn't. They aren't in need of investment capital and haven't been for 20+ years.

Good on you Nintendo for being an outstanding corporate citizen.

apple, the big winner...

[slew]

Some analysts have appeared to suggest that the 30% iTunes cut from in game purchases of poke-crap might net them $1B over the next couple years...
Of course that's a drop in the bucket for Apple, and everything may fizzle before poke-crap becomes popular, so you never know...

My Business

[Soniask]

My Business Network

Yahoo!

[DarthVain]

So today we see that the company Yahoo is to be sold for less than 5 Billion, and we also see that Nintendo mentions it is only part owner of the creators of the Pokemon Go game and looses over 6 Billion in value.

That has got to be some salt in the wound of Yahoo I have to think. Your worth exactly less than part of a company that owns a small part of another company that made a popular video game. Internet Empire!

Chickens

[lucien86]

The flock of chickens runs one way one day, and the other the next day. Share dealers are mindless panicky animals, it takes very little to send them in a run for the next tasty titbit or the smallest noise or movement to send them running in the opposite direction..

PokemonGo

[PlaynBass]

Ah! Investors! Could they possibly more clueless! There IS no unlimited growth, folks! Why not realize that, and figure out how to make an economy work by just making enough, not insisting that EVERY company must get BIGGER. Slow and steady is what lasts for thousands of years, not these frenzies that investors tie themselves up into knots over. Let's get real, folks: take care of the planet and our human needs FIRST, before investors and the large multi-national corporate greed that they spawn are allowed to trash our planet with their monolithic obsession over counting imaginary bits of promised value, instead of real life necessities, like air, water, soil and food for all our biological robots!