Investing in Gaming Industry

Question

I am looking to invest about $10k into one rising company that is about to release a MMORPG late 2008 early 2009. In particular I was looking at Huxley (made by Webzen or NASDAQ:WZEN) and Stargate Worlds made by Firesky Inc. Now, Firesky is under the company of Cheyenne Mountain Entertainment neither of which are placed on NASDAQ. The game is set to have quite a good rating so far and probably will be a success yet when will it hit NASDAQ and under what ticker?

On the other hand which would be a better pick, WZEN which for the past 5 years has dropped massively from $12/stock to $2.69/stock yet Huxley is supposed to be a competitive first shooter MMORPG. A first of its kind with such gaming complexity. Or perhaps wait for Firesky to provide stocks, if it ever will, and invest in it right on the spot.

I am open to any other suggestions for games (or game rumors) that I should look into.

Cheers

Answer 1

There is no guarantee they will ever issue public stock, most companies don't.

If the game is expected to be good, that is already factored into the stock price for the most part. That's probably the only thing still holding WZEN afloat.

Answer 2

Interesting question, sounds like you're looking to invest in a sector you know so that's a good first step.  I would suggest though that you diversify your investments.  It would not be good to invest 10k in one of these companies if its the only money that you have, and definatly don't invest all of the moeny at one point, buy a little at a time.  There is no promise that a company will ever go public, so you could wait forever for Firesky to go public and never see it happen.  Would Webzen be a good takeover target.  Take Two Interactive had their stock jump when EA wanted to buy them.

Now as far as Webzen is concerned what do you know about the Huxley game.  Has the release date been pushed back ever and if so how many times.  If it hasn't been pushed back yet it will, games always do.  Does Webzen have anything else going on for game development or is this game it.  If this game fails will the whole company fail.  As cool as the game sounds you never know what may happen.  It sounds like it may take a lot of resources to run the game (is there a reason MMORPG's aren't first person shooters, and that first person shooters only use up to 32 people) will their servers be able to handle to load, or will it lag so bad it's not fun and no one plays.  

Be careful, if it all works out well for this game you could make money but if it fails the company could go bankrupt.  Careful with rumors, often they're not true and if they are true by the time us regular people hear news about stocks the Wall Street guys consider it old news.