Stock Trading and Stock Investing

Online Betting Service Temporarily Suspends Wagering on Google IPO Price

Betting Restored in Restructured Form After Onslaught of 'Under' Action on Opening Price

Company Online Stock Trading SAN JOSE, Costa Rica--(BUSINESS WIRE)--Aug. 16, 2004--SportsBook911.com, a leading online betting service, temporarily suspended "over-under" wagering on the Google IPO auction after an onslaught of bets from New York and California saying the search engine would have an opening price of less than $110 per share, the mark set as the over-under by the online wagering site as well as the price expected by most money managers. Google itself is predicting an opening price of $108-$135.
"The reality is that the general public does not usually buy stocks over $100, which we think will severely reduce the possible investor pool, therefore there will not be enough buyers to support that price," according to Mike Nickels, president of GC Sports Group, which operates SportsBook911.

But when the IPO market is hot, a lot of traders buy into any new company. They commit a trading mistake that` They place market orders for an IPO before it starts trading on its first day, ups in price right when trading opens. For the trader, these orders are a sure way to lose money. Your order will end up being filled at a ridiculously high price that the stock options may never see again.

Online Trading Stock And The temporary suspension was lifted today with a revised wagering platform that includes five price points, with varying odds for each, for the stock's opening price and closing price. Initial wagering was for the opening price only.

Another basics of stock options trading play is to short stocks with upcoming IPO lockup expirations. An IPO lockup is a period of time, usually from six to eighteen months, when insiders who obtained the IPO at the offering price or less cannot sell their shares. Once this time period has elapsed, insiders often sell their shares. This trend is shortable because the greater the number of shares unlocked, the more likely it is that insiders will start to sell their shares, particularly if the market is not doing well but the share price is still higher than the IPO offering price. And the more shares freed, the better the chance of a negative effect on the share price. This trade works best when the number of shares being unlocked is more than 25% of the current market capitalization.

Stock Investing Course "We received an extraordinarily high volume of wagers from people in New York and California saying that the IPO auction would result in the stock opening below $110, which prompted us to revise our closing price betting structure," Nickels said. "Given the financial connections of people in those two cities, we quickly recognized that we needed to change our wagering structure to level the playing field and make this more of a challenge for our customers who will have a way to make money on the Google IPO without having to actually buy a share."

Stock System Trading Nickels said he does not anticipate any additional changes to the Google IPO wagering structure.

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Stock Investing Game Contacts

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Market Stock Trading
GC Sports Group
Mike Nickels, 800-213-3370
mike@gcsports.com

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