Contributed by Lauren Davis
Move over, fantasy football. There’s a new game in town. The UpDown, a new fantasy investing site, enables its members to trade stocks rather than quarterbacks. The site provides each member with a $1 million dollar virtual portfolio, which they can then invest and grow, all without the risk of putting up any of their own money.
Fantasy stock picking can be a great way for women who are starting out in finance to increase their confidence in the stock market and their tolerance to risk in a friendly, collaborative environment where they don’t have to be afraid of failure. For these reasons, the site has proved very popular with women users. (More so than fantasy football, but the sporty women who brave the office fantasy pool will be the subject of a forthcoming Intrepid Women article).
According to cofounder and CEO Michael Reich, The UpDown was envisioned as a way to harness the “wisdom of crowds” to create a powerful investing tool. In addition to investing, The UpDown members provide analyses and tips on stocks, and can rank and provide feedback on the stock analyses of other members. Reich’s hope is that, as it grows, The UpDown will consistently beat the S&P 500, and he notes that, even though the site is only a few months old, a handful of members have already doubled their portfolios. And, even though it deals in play money, the site offers a very real incentive for members to do well: it pays cash to members whose portfolios outperform the S&P, as well as for the week’s most insightful stock analyses.
In addition to investing wisdom, a strong social current also runs through the site. Investment clubs, offices, and friends can form “groups” and create a joint portfolio, or compete to see which member earns the most money. Amanda Brzoska, a senior at the University of North Florida who manages one of the site’s largest groups, uses The UpDown to keep in touch with peers who have graduated and gone on to Wall Street. Much like other social networking services such as MySpace and Facebook, The UpDown lets members designate other members as “friends” and communicate with them through a private messaging system. This way, Brzoska and her friends can trade personal news and anecdotes while they trade stock tips.
Brzoska also touts The UpDown as providing excellent hands-on experience in investing. As a finance major, she points out, “there are certain skills you just don’t get in the classroom.” The UpDown allows her to develop her analysis and forecasting skills, learn what to buy and when to sell, and easily research stocks in a realistic but risk-free environment. The communal nature of the site also helps her gather information from all over the country and lets her interact with more experienced financial professionals, an opportunity she would not otherwise have.
It will be some time before the cofounders will learn if The UpDown reaches its goal of beating the S&P, but for members who enjoy pairing their social interactions with possible financial gain, The UpDown has already proved a success.