A share of Google stock is valued at $255.45

[surreal1221]

eek, lots of rich people still. . . lol

 

[Pepsei]

This have something to do with them joining S&P 500, typically the stock will go up for 5% or so and then drop back to normal when this happens. so.....

 

[Blieb]

Originally posted by: Futher
I smell a stock split...

Kramer on MSNBC or whatever the other night was saying they'll avoid a split, trying to keep # of shares out low.

He said he expects $350+ ....

 

[GoingUp]

I wanted to buy some at the IPO, but I didnt have the cash to do it

 

[Krk3561]

Originally posted by: Blieb

Originally posted by: Futher
I smell a stock split...

Kramer on MSNBC or whatever the other night was saying they'll avoid a split, trying to keep # of shares out low.

He said he expects $350+ ....

Because MSNBC is the source of all wisdom and always right.

 

[frankie38]

I am very tempted to party like it's 1999. I think that I will have to sit this GOOG party out. The risk is very high, the rewards are potentially very high too.

GOOG will have to deliver extraordinary results, more than $7/share since that number is already baked into the expectations. Any mistakes and there will be alot of unhappy speculators.

My advice. Stay away. Watch and learn. Buy YHOO if you really cant control yourself.

 

[DaveSimmons]

Originally posted by: frankie38
I am very tempted to party like it's 1999. I think that I will have to sit this GOOG party out. The risk is very high, the rewards are potentially very high too.

GOOG will have to deliver extraordinary results, more than $7/share since that number is already baked into the expectations. Any mistakes and there will be alot of unhappy speculators.

My advice. Stay away. Watch and learn. Buy YHOO if you really cant control yourself.

Or buy Vanguard.com VFINX since then you'll get a little Google in your S&P 500 (I don't pay attention to who's in the 500, but Pepse said they're joining / joined).

 

[Platypus]

WAFFLES!!!! BUY WAFFLES!

 

[OffTopic1]

Originally posted by: Kipper

Originally posted by: Caveman
Can someone explain how to "short" a stock? I've never understood how this is done...

You essentially sell shares which do not belong to you and are loaned to you on margin, then hope the stock price DROPS.

So assume you short sell 40 shares of Google at $250 apiece = $10,000 proceeds are now available in cash.

When your margin is called or whenever you feel like "covering" your short, you must repurchase shares to return to the original owner...

If Google shares are now $200, then you pocket $50/share in profit because you only have spent $8000 of the original cash proceeds = $2,000 in profit.

However, if Google shares have RISEN, you lose money on your short because you need to pay more out-of-pocket to cover those shares you sold short.

So if Google goes to $300, you have gotten screwed $50/share (need to pay $12,000 to repurchase those 40 shares) and are now in the hole $2000.

The stock must be going up before your broker will let you borrow it to short.
You must have enought money to cover the original price at the time that you short.
You also have to pay margin interest to your broker during the time that the stock is short.

Stock price go down you win, up you lose.

 

[Kenazo]

Originally posted by: cjgallen
SELL SELL SELL

Short Short Short.


or Split Split Split, not too sure what's going to happen.

 

[Miramonti]

Originally posted by: binister

Originally posted by: Mildlyamused

Originally posted by: binister

Originally posted by: Kipper

Originally posted by: Caveman
Can someone explain how to "short" a stock? I've never understood how this is done...

You essentially sell shares which do not belong to you and are loaned to you on margin, then hope the stock price DROPS.

So assume you short sell 40 shares of Google at $250 apiece = $10,000 proceeds are now available in cash.

When your margin is called or whenever you feel like "covering" your short, you must repurchase shares to return to the original owner...

If Google shares are now $200, then you pocket $50/share in profit because you only have spent $8000 of the original cash proceeds = $2,000 in profit.

However, if Google shares have RISEN, you lose money on your short because you need to pay more out-of-pocket to cover those shares you sold short.

So if Google goes to $300, you have gotten screwed $50/share (need to pay $12,000 to repurchase those 40 shares) and are now in the hole $2000.

Basically going long on a position has a finite amount of risk. That is, you buy a $10 stock, the most you can lose is $10.

Going short on a position has an unlimited amount of risk. That is, you short a $10 stock and get called when it is worth a googol you lose a googol - $10.

Going short can be risky. Just ask folks who tried to short TravelZoo.

Yea but what you guys are forgetting is the fact you don't have to sell...

Uhh, yeah you do if you don't have the assets to cover the margin.

Kipper: True, stop losses can keep you from losing more than you want to but the downside of shorting is much more risky than that of going long as a rule.

I definitely overall agree. The upside loss of shorting is theoretically unlimited and the downside is limited, while stops won't protect against gap openings or trading halts.

Also, because of the short sale rules, it is a lot easier to jump on the bandwagon and buy in a rally than it is to join in a panic and sell, since its harder to short sell in a plummeting market, making it easier for a stock to rally significantly.

And with the ease of traders jumping on a rally bandwagon, stocks tend to become more overvalued more often than the opposite, which triggers short sale stops more recklessly, only to correct and sell off afterwards, but locking in a loss for the short seller.

Also as a result of unlimited upside and limited downside, there almost always will be buyers in a selloff, giving more and better opportunities to exit out of a long position, whereas in a bursting rally, especially a prolonged one, sellers quicker become less and less, giving a stop order in these conditions a much worse fill.

Many stocks also can't be shorted, simply because they are too hard for the brokerages to borrow them, which makes the stocks more vulnerable to becoming overpriced as well.

Last though is that there is a generally tendency for the market to go up over time, as well as a general tendancy for new money to progressively come into the marketplace, as well as most money managers trade from the long side with a much smaller percentage of managers and institutions looking for opportunities to short stocks.


/EDIT: Summary: Over all, 'overvalued is overvalued and undervalued is undervalued', but because of the factors and conditions of trading either side, its much more important to be very selective when shorting. In other words its more important to find something that is 'even more overvalued' before shorting than it is when finding something undervalued when buying (imo.)