Game Industry Shares... Inside Trading?

IchII3D

I was wondering if anyone could shed some light on what would be classed as inside trading in the game industry? I'm new to this whole share dealing business and wouldn't want to land myself in prison or potentially committing fraud...

Basically as an example I work for Crytek and we have a publishing deal with THQ for Homefront 2, I work at the UK studio but am working on Crysis 3. If I was to buy shares in THQ would that be classed as inside trading? The same could be said for EA...

ZacD

As long as you are not acting on confidential information, or unreleased information it is fine. If you hear from your boss a we are going to be merging with this studio one the paper work is finalized, you cannot buy or sell stock until that info is released publicly.

Jeff Parrott

I would say as a rule of thumb probably avoid buying shares (outside of some employee deal at the company) of the place you work at/with. It really seems like a grey area.

Also I would avoid buying THQ in general as they're super close to be delisted.

ericdigital

jeffro wrote: »

I would say as a rule of thumb probably avoid buying shares (outside of some employee deal at the company) of the place you work at/with. It really seems like a grey area.

Also I would avoid buying THQ in general as they're super close to be delisted.

agree 100% with this

IchII3D

Thanks guys, I don't plan on buying any shares for a while, but its something I hope to get into in the future. Just exploring how the whole system works.

Justin Meisse

well it's a gamble, if Jason Rubin can turn the company around you'd make a good amount of money. The reverse stock split they are planning to do, while not a great thing, will delay the delisting.

Mark Dygert

I really don't see THQ pulling out of it, they might survive if they switch their strategy and give up on the stock market all together.

But on the other hand its cheap and as long as you don't sink a lot of money into it, you might get a good return, just don't put all of your eggs in the one basket.

slipsius

Ive never done share trading before. Ive wanted to. Just dunno how to get started. So take this with a grain of salt.

I think if you want to buy shares just because you like the game you`re working on, do it. I don't think there's anything wrong with that. However, if the game is unannounced and is going to shoot the stock up a crap ton when its announced. maybe not. Like, if you worked for microsoft, and you know they are going to announce their next gen system in a couple days, so you buy stock. That would be borderline insider trading. If not fully.

But, if you`re curious, talk to your HR! Im sure they`ll know somehting about it. Some companies offer shares to their employees. Sure, some might ask for them back, and fire you if you dont, but that's pretty rare

Calabi

I wouldnt buy any shares. The market is going to collapse in the not too distant future.

http://www.zerohedge.com/

JacqueChoi

Let me tell you what little I know about Stocks.

It is based on GROWTH, not on profitability.

What that means is, Activision is EXPECTED to have 15million subscribers, sell 20 million copies of CoD, and sell 15 million of Diablo 3, so despite reaching those lofty numbers, their stock price stagnated.

If those expectations are NOT met, the stock goes down. If you want that stock price to go up, Call of Duty has to sell 40million copies, Diablo 3 has to sell 30million copies, and they introduce a brand new IP that sells FAR more than anything anyone was expecting.



THQ is a high risk high reward type stock. It shouldn't be considered insider trading (blind faith more than anything). The securities commission might hit you up if you were a CEO who was proven to have profited off of information prior to being made public. I know few guys that have already invested.

sprunghunt

I would ask the HR department at crytek. They'll have the proper legal advice.

chrismaddox3d

I have been trading on the stock market for a long time.
You win some you lose some, i always lost with video game stocks.
The stocks i personally made good money off were not game companies.
Here is a few companies i did pretty well with last yr or two and etc.
Baidu,Caterpillar,Celanese Corporation,China Unicom,Energy Stocks many more i forgot now.

I am not telling you what to go buy just be carefully.
You basically just have to do your homework before you buy.
Also pay attention to your stock daily or weekly.
A few times i didn't pay attention close enough and lost some money.
Side note Facebook stock was a bad buy and glad i didn't get that,lol
Also don't regret in the market only do.

RyanB

You are perfectly safe buying and owning stock in your employer's company. You aren't an executive and will never be in a position to profit from insider trading. Its a non-issue.

I wouldn't recommend buying individual stocks generally. Stick with an index ETF of the sixty biggest companies on an exchange (something like http://ca.ishares.com/product_info/fund/overview/XIU.htm ) and you will do much better over the long term.

Recommended reading : 'A Random Walk Down Wall Street'

IchII3D

Thanks for all the advice guys, hopefully its useful to others also. With the interest rates on ISA accounts saving money can be a little wasteful. Although the economy isn't going anywhere yet inflation goes up... But then again any investment I would ever make in shares would be money lost, I would see it as an expensive day at a casino just with more control over if I win or lose :P

artquest

IchII3D wrote: »

Thanks for all the advice guys, hopefully its useful to others also. With the interest rates on ISA accounts saving money can be a little wasteful. Although the economy isn't going anywhere yet inflation goes up... But then again any investment I would ever make in shares would be money lost, I would see it as an expensive day at a casino just with more control over if I win or lose :P

Heh, the best I've heard it explained is... no one is going to do a better job of handling your money, than you! Why drop a bunch of money into a fund where other people invest it for you right? Do your research, be smart about it and you'll come out on top for the most part. Only time I've lost so far is when I didn't pay attention to the market.

So yeah, like others have said, you're not really in a position to benefit from insider trading I think. But it can't hurt to ask your HR department about it anyway.

Good luck!

GarageBay9

I'd suggest not putting money in the game industry right now and shorting the Euro instead.

You'll be able to open your own studio here shortly.

Justin Meisse

Hugh wrote: »

I would never own shares of your employer. Our industry is never very stable. An studios come and go very quickly in many cases.

I mean for example Enron. Employees invested in the company. They lost there jobs and many lost everything due to it.

it's a gamble, plenty of Google employees got rich off of investing in their company. I'd love to buy stock in my company but it's privately owned :-P