The Red Steel trade is exactly how things happens in the real stock markets. As new information comes to surface, traders begin to trade on the new information and the marketmakers try to adjust quickly. The marketmaker is unlikely to be the first to know the new information but probably always a close second. Legally or not those with the knowledge and those who are fast, observant, decisive, and perhaps lucky are those who are most rewarded.
I understand how in your Red Steel example, one would expect the marketmaker to react faster, this was why the automated marketmaker has been recently updated. However I don't understand why it seems like you believe that those who discovered the report shouldn't be rewarded or were doing something underhanded by trading on the new information that was discovered. There will always be someone who gets their hand on information first and the quick will be rewarded. I also fail to see how this relates to the delisting or suspension of stocks and how it would solve the problem of to many stagnant stocks.
I do agree that ideally there would be no automated market maker but this market is still in its infancy and an automated system is pretty much required for there to be any trading at all especially in the stocks with low volume.
As for the so called high-profile IPOs, I believe that the amount of time a stock is listed on the simExchange doesn't correlate to how overvalued/undervalued a stock is. I think the reason why big names tend to get more overvalued is more of a fundamental problem with popularity than it is an issue of how long a stock is listed.
A great number of stocks are listed very close to their release date and that doesn't make them better valued than the ones that have traded for a long time. In fact listing very close to the release date can only exacerbate the problem, there is very little time to get any pre-release trading and very few get to express their opinion before hard data starts coming out. I believe more active trading over time should make stock predictions more accurate not less.
Additionally having an IPOs very close to the release date puts all the pressure on the admins to pick a reasonable starting prediction and perhaps that is why many stocks are vastly overvalued and undervalued.
It also may only be your opinion that Halo 3 and Smash Brothers have been pushed to hugely overvalued levels. I admit I have avoided shorting the high profile games partially because I knew they were going higher, but I also I believe many shorts like myself have ignored the high profile games not because they aren't overvalued, but because there were even better opportunities in many low profile games like Death Jr. that were even more greatly overvalued with far less risk. At one point I believed that Death Jr. was over 80% overvalued, there is no way that Halo 3 or Smash brothers are 80% overvalued even at these current levels.
However things are definitely changing with the new marketmaker moving things very quickly and perhaps some high-profile pigs will be the next to fall. It feels like the easy money in released games is starting to dry up and I've begun looking at shorting several big name titles. There is one in particular that I have been building a large short position in since the change over.
Overall I believe the any problems with stagnating stocks as well as overvalued big names may have already been solved with the new marketmaker. I still feel we should all just let this new market shake out for at least a couple of weeks before we go out on a delisting witch hunt.
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The Red Steel trade is exactly how things happens in the real stock markets. As new information comes to surface, traders begin to trade on the new information and the marketmakers try to adjust quickly. The marketmaker is unlikely to be the first to know the new information but probably always a close second. Legally or not those with the knowledge and those who are fast, observant, decisive, and perhaps lucky are those who are most rewarded.
I understand how in your Red Steel example, one would expect the marketmaker to react faster, this was why the automated marketmaker has been recently updated. However I don't understand why it seems like you believe that those who discovered the report shouldn't be rewarded or were doing something underhanded by trading on the new information that was discovered. There will always be someone who gets their hand on information first and the quick will be rewarded. I also fail to see how this relates to the delisting or suspension of stocks and how it would solve the problem of to many stagnant stocks.
I do agree that ideally there would be no automated market maker but this market is still in its infancy and an automated system is pretty much required for there to be any trading at all especially in the stocks with low volume.
As for the so called high-profile IPOs, I believe that the amount of time a stock is listed on the simExchange doesn't correlate to how overvalued/undervalued a stock is. I think the reason why big names tend to get more overvalued is more of a fundamental problem with popularity than it is an issue of how long a stock is listed.
A great number of stocks are listed very close to their release date and that doesn't make them better valued than the ones that have traded for a long time. In fact listing very close to the release date can only exacerbate the problem, there is very little time to get any pre-release trading and very few get to express their opinion before hard data starts coming out. I believe more active trading over time should make stock predictions more accurate not less.
Additionally having an IPOs very close to the release date puts all the pressure on the admins to pick a reasonable starting prediction and perhaps that is why many stocks are vastly overvalued and undervalued.
It also may only be your opinion that Halo 3 and Smash Brothers have been pushed to hugely overvalued levels. I admit I have avoided shorting the high profile games partially because I knew they were going higher, but I also I believe many shorts like myself have ignored the high profile games not because they aren't overvalued, but because there were even better opportunities in many low profile games like Death Jr. that were even more greatly overvalued with far less risk. At one point I believed that Death Jr. was over 80% overvalued, there is no way that Halo 3 or Smash brothers are 80% overvalued even at these current levels.
However things are definitely changing with the new marketmaker moving things very quickly and perhaps some high-profile pigs will be the next to fall. It feels like the easy money in released games is starting to dry up and I've begun looking at shorting several big name titles. There is one in particular that I have been building a large short position in since the change over.
Overall I believe the any problems with stagnating stocks as well as overvalued big names may have already been solved with the new marketmaker. I still feel we should all just let this new market shake out for at least a couple of weeks before we go out on a delisting witch hunt.