Archive - Dec 16, 2007
The recent discussions about exchanges and trading strategies in Second Life has prompted me to explore a little bit more some of these ideas. At the first public class of the Investment Education Team, there was a discussion about price earnings ratios. It was noted that stocks in Second Life seem to trade with little correspondence to these ratios. With banks and exchanges paying as much as 44% interest per annum, it means that any stock with a Price Earnings ratio higher than three needs to be less riskier than the banks or exchanges, to justify such a ratio, and that just isn’t all that likely.
So, it may be useful to move from fundamental analysis to technical analysis of the stocks in Second Life. Three exchanges, SLCapex, ACE and VSTEX provide in a format that makes it easy to do some of this analysis. A fourth exchange, ISE provides some similar data, but in a different enough format so that I haven’t gone out and added it to my mix of data.
Specifically, using the data feeds they provide, you can build your own data store and ticker plant. I wrote a little bit about that here. Now that I have a good store of data, I can start analyzing some underlying trends.