Relative Performance
Stock Betting

It is possible that a poorly managed or otherwise unattractive company’s shares will outperform the shares of a well-managed or otherwise attractive stock. The market valuation of stocks is the result of buy/sell decisions of investors reflecting their opinion of future price changes. Most investors believe the buy/sell activities of other investors will ultimately reflect the same views as they hold regarding both stocks. Therefore, bets on the relative price performance of securities’ should reflect the results of management actions and circumstance, but do not always do so, because both levels of information and investor actions can differ.

Therefore, bets on the relative price performance of stocks may have to be based on a calculation other than that of a flat percentage change. It may be necessary for the initiator of a bet to attract a counterparty to take the other side of the bet by increasing the degree of performance delta, such as a bet that shares of AMZN will outperform the performance the other specified stock or the S&P 500 by 150% or 200% by the end of the betting periods of 30, 90; or 180 days.

It is the role of the broker to comminate the terms of a Club member’s bets to other Club members when seeking to arrange on behalf of the bet initiator the necessary counterparty. The Club anticipates 24/7 virtual operation. However, it will be the last sale price of shares trading in the primary market which will be used to calculate the result of each bet.

The DoBetter Club will be paid a brokerage fee of 10% of the winning bettor’s winnings and the bet loser will lose all that is wagered.

For those wishing additional information please contact me.

 

Arthur Lipper, Chairman                           arthurlipper@gmail.com
British Far East Holdings Ltd.