Investing Logic

Posted on June 10, 2010

5


So, I finally got off my butt and went to grab a timmies. While I was driving and the dogs were whining for Timbits, this thought popped into my head, so I am putting it out there. Shall we discuss?

I keep investing in people for all the reasons I have posted all over, whether for dividends or to make money on their stock rise, or because i value them and want them in my portfolio.

How do we decide how much to invest in all of these? See the point that a lot of people seem to miss is that it isn’t a game where you are trying to hit number one, it is a measure of your online influence. You are going to cap out. You will plateau. That number is the measure of what you do online. They aren’t looking to make you frantically tweet and facebook and blog just to make score. You can tweak what you do a bit and make that score better, but you will just wear yourself out if you are unnaturally tweeting and blogging etc to increase your value. You may tweet more and bl0g more and update your status more, just because you use it more (like I did), but no one is asking you to go spam the world.

In fact if you go through the leader board, there are a bunch of people who are up high and rarely touch Empire Ave. They plug it in, check in periodically and spend their cash and just let it do what it does. One of them can barely use the site!

Anyway, so what popped into my head, is how many new people buy me back at 5 or 10 shares and apologize for not buying more. See the thing is, I don’t need you to buy more! 5 or 10 stocks is a lovely thank you, and you are keeping the rest of that money to go and make ME money on my investment! Go spend that money and get your face out there. Don’t buy me at 50! I am finally plateauing! I cost 5 times as much as a newbie and on a good day I make a whole point! woot! Those newbies that are working it are making 3-6 points a day on a 10 investment. It is simple math here. Go buy THEM, get them to buy you back so your stock rises and I can make some cash lol.

Yes the newbies are riskier. Some burn themselves out playing the score game, some get frustrated at the drops, some just don’t get it. BUT the ones who do click run with it. And they run hard! When you make a whole bunch of money and have the luxury of buying people who are of value to you, then come back and buy me. We will both be happier! I will love your 50 share investment even more at that point I promise! (not that I hate them now lol)

Now this is assuming you are going to be active on the site. That you want to build up a portfolio of value. If you are going to be one of those people who hook it up, don’t have the time to mess with it, and just want to come check in with it (and don’t get me wrong, I think that is a GREAT way to do it as well) You are going to want to invest differently. You do not have the time to keep track of new players and watch when to buy and sell. These people are the ones who will want to go invest on the big expensive stocks. Their portfolio is unlikely to take a dive. We have figured it out. We have found our stride and we are still rising, we just aren’t streaking up the board anymore. We are very good long term, no thinking investments. In fact, if you can find the ones who are on the leaderboard and not touching this a whole lot and are just doing their thing, they have the most natural activity in the world!!

Am I out to lunch on this? Anyone care to weigh in?

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Posted in: Investing Logic