Tuesday, December 8, 2009

Trade 207 + 206 - ATVI/tech100



Pair Trade - short NASDAQ + long ATVI

toppy market

Activision - Looks cheap
market 11.40
stop 10.35

thesis

1/AUD related trade - (AUD @ highs)
2/ starcraft 2
3/ broker upgrade related to china sales

Activision is the more like the google of the gaming industry whilst nintendo, konami, EA seem to be more like the microsofts. Activision are leading the arena for the 'market of gamers' as opposed to the other 3 who tend to rely on intellectual rights and guarding their market share through

In either case I feel like a large consolidation will be coming, with companies that have managed to spruik earnings through revenue even during this downturn, as opposed to the cost cutting financial industry - this bodes well for intuitive investing.

The key to the potential of 10-dupling your money is the ever preminent talk of china in everything globally asset related - anyone with a hand in china's stupendous growth allusion will see a re-rating in its stock somewhere down the track - the key to activision is some broker realising the vast link between chinese, korean stickiness to starcraft 2 - a game that will storm the record books in sales figures, purely on the power of internet cafes and high school students alone.

The key market in first person free shooter, call of duty, RTS with starcraft 2 and MMORP through WOW - you can't see a business with a better cashflow and hold of the ever elusive time leisure market.