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What stocks, shares and markets are, and how trading works.
19 entries
1100sโ1600s
Merchants pool money to send ships, and a share of a voyage becomes a share of a company.
A merchant sailing to Alexandria or Constantinople needed money for cargo. Under a commenda contract, investors who stayed home put up the money and the travelling merchant did the work. If the ship came back, they split the profit, often three quarters to the investors and a quarter to the merchant.
If the ship sank, investors lost what they put in and nothing more. Many people could each own a slice of many voyages instead of betting everything on one.
๐ก Why it made sense then
One voyage could make or ruin a family. Splitting a voyage into pieces let people share the risk, and owning pieces of several voyages spread it further.
Ideas it gave us
A share is a single unit of a company's stock. The number of shares you own divided by all shares outstanding is your percentage of ownership.
๐ฎ Game shares can be bought in fractions, so any amount of play money buys some. Your percentage of a listing is your shares divided by its 200,000 total.
Open the full entry โDiversification is spreading money across many different investments so a loss on one has less effect on the whole portfolio.
๐ฎ ETFs let you invest in a whole group of people at once.
Open the full entry โPacioli's Summa de arithmetica, printed in Venice in 1494, explained the double-entry method merchants used: every amount is recorded twice, as a debit and a credit, so the books balance and show what a business owns and owes.
The same book gives the rule of 72 for how long money takes to double at compound interest.
๐ก Why it made sense then
Merchants with partners, agents and many voyages needed to know what they had paid for goods, what they owned and whether they were making money.
Ideas it gave us
Net worth is everything you own minus everything you owe.
๐ฎ Your net worth is your cash, savings, shares, options and farm plots at today's prices, minus any margin loan and short positions. The leaderboard ranks players by how much it grew this season.
Open the full entry โCost basis is what you paid for an investment, including fees, used to work out your gain or loss when you sell.
๐ฎ Your portfolio shows the average cost of each position. When you sell, your gain is the sale price minus that average. A loss disallowed by the wash sale rule is added to the cost of the new shares.
Open the full entry โCompound interest is interest earned on both your original money and the interest it has already earned, so savings grow faster over time.
๐ฎ Savings at the bank earn interest daily, and interest earned stays in savings where it earns more, so it compounds.
Open the full entry โIn the 1400s, merchants in Bruges gathered outside an inn owned by the Van der Beurze family to trade bills and goods, which gave the word "bourse" to exchanges across Europe.
In 1531 Antwerp opened a building designed for trading, where merchants from many countries met every day.
๐ก Why it made sense then
Putting buyers and sellers in one place at one time made it easier to find a trade and to see what things were worth.
Ideas it gave us
A stock exchange is a regulated marketplace where buyers and sellers trade shares, such as the New York Stock Exchange (NYSE) or Nasdaq.
๐ฎ The whole game is one small exchange: every listing trades there, prices come only from player trades, and the ๐ Stock exchange in the city is where the market lives.
Open the full entry โIn 1553 a group of London merchants pooled money to send ships looking for a northeast passage to Asia. Instead of funding one trip, investors bought shares in a company, later chartered as the Muscovy Company, that would run many trips.
๐ก Why it made sense then
Long, expensive expeditions needed more money than a few partners had, and a lasting company could keep going after a single voyage failed.
Ideas it gave us
A stock is a unit of ownership in a company. Owning stock gives you a share of the company's value and, usually, a vote and a claim on its profits.
๐ฎ In Journey Shares, each listed public figure has 200,000 play-money shares you can buy and sell, priced by supply and demand.
Open the full entry โIn 1602 the Dutch East India Company (VOC) let anyone in the Dutch Republic subscribe for shares, raising about 6.4 million guilders from over a thousand investors. It's often called the first public offering.
The capital was permanent: investors couldn't take their money out after a voyage, so they sold their shares to someone else instead, and a market in them grew in Amsterdam. The company paid its first dividend in 1610, partly in spices.
๐ก Why it made sense then
Trading with Asia took years and huge fleets. Permanent capital let the company plan for the long term, and a place to sell shares let investors get out without the company paying them back.
๐ฎ In Journey Shares
Listing someone in Journey Shares is the game's public offering: the first buyers get the lowest prices, and the player who listed them earns 1% of every buy in the first week.
Ideas it gave us
An IPO is the first time a company sells shares to the public, after which its stock trades on an exchange.
๐ฎ Listing someone is the game's IPO. The player who lists them earns an underwriting fee of 1% of every buy in the first week.
Open the full entry โA share is a single unit of a company's stock. The number of shares you own divided by all shares outstanding is your percentage of ownership.
๐ฎ Game shares can be bought in fractions, so any amount of play money buys some. Your percentage of a listing is your shares divided by its 200,000 total.
Open the full entry โShares outstanding are all the shares of a company currently held by investors. The float is the part of them that's free to trade publicly.
๐ฎ Each listing has 200,000 shares: 100,000 trade on the public pool and 100,000 are held in escrow for the person, released only if they claim their profile.
Open the full entry โA dividend is a cash payment a company makes to its shareholders out of its profits, usually every quarter.
๐ฎ Game listings don't pay dividends. The nearest thing is a farm plot from the ๐พ Farm co-op in the city: it pays a harvest every day, which is taxed as income, like a dividend.
Open the full entry โA stock exchange is a regulated marketplace where buyers and sellers trade shares, such as the New York Stock Exchange (NYSE) or Nasdaq.
๐ฎ The whole game is one small exchange: every listing trades there, prices come only from player trades, and the ๐ Stock exchange in the city is where the market lives.
Open the full entry โA stock is a unit of ownership in a company. Owning stock gives you a share of the company's value and, usually, a vote and a claim on its profits.
๐ฎ In Journey Shares, each listed public figure has 200,000 play-money shares you can buy and sell, priced by supply and demand.
Open the full entry โ1600sโ1790s
Shares trade in coffee houses and bourses, the first bubbles burst, and governments borrow from the public.
In London's Exchange Alley, a trader who sold shares he didn't own was said to sell the bearskin before catching the bear, and short sellers became "bears". Buyers who pushed prices up became "bulls".
๐ก Why it made sense then
Markets have always needed quick words for the two sides of a bet.
Ideas it gave us
A bear market is a long period of falling prices, usually a drop of 20% or more from a recent high. Being bearish means expecting prices to fall.
๐ฎ When prices across the game fall together, it's a bear market. You can profit from falls by short selling at the bank or buying puts. The city's ๐ป bear market parade is only for show.
Open the full entry โA bull market is a long period of rising prices, often defined as a 20% rise from a recent low. Being bullish means expecting prices to go up.
๐ฎ When most listings rise together, the whole game is in a bull market. The city also stages a ๐ bull run through downtown from time to time, just for fun.
Open the full entry โ1770sโ1920s
Thinkers explain prices, trade and competition, while the telegraph and the ticker speed markets up.
The stock ticker, introduced in 1867, sent prices by telegraph and printed them on paper tape in brokers' offices. Company names were shortened to a few letters to save time: ticker symbols.
๐ก Why it made sense then
Prices used to travel by runner. The telegraph let traders far from the exchange see prices within minutes.
Ideas it gave us
A ticker symbol is the short code of letters used to identify a stock on an exchange, like AAPL for Apple or TSLA for Tesla.
๐ฎ Every listed person has a ticker too, 2 to 5 capital letters, unique across the game, like $HSN for Hasan Piker.
Open the full entry โA real-time quote is a stock's current price as trades happen, as opposed to a delayed quote that lags by 15 to 20 minutes.
๐ฎ Prices, moves and market caps in the game update live as players trade.
Open the full entry โThe Revenue Act of 1921 taxed gains on assets held over two years at 12.5%, below the top income tax rate. The same year, Congress stopped investors claiming a loss when they sold and quickly bought the same shares back: the wash sale rule.
Laws of the same years first let losses carry over to reduce tax in later years. Today US investors can use up to $3,000 a year of net losses against other income, a limit set in 1978, and carry the rest forward.
๐ก Why it made sense then
High wartime tax rates made people hold on to investments rather than sell, and some sold at a loss only on paper to cut their tax.
Ideas it gave us
Capital gains tax is tax on the profit from selling an investment for more than you paid. In the US, gains on assets held over a year are taxed at lower long-term rates (0%, 15% or 20%) than short-term gains, which are taxed as income.
๐ฎ Game gains on shares held a week or less are taxed at 22%, longer holds at 15%, on a weekly tax year.
Open the full entry โA capital gain is the profit from selling an investment for more than you paid for it; selling for less is a capital loss.
๐ฎ Gains are taxed on a weekly tax year: holds of a week or less at 22%, longer at 15%.
Open the full entry โThe wash sale rule stops you from claiming a tax loss if you buy the same or a substantially identical investment within 30 days before or after selling it at a loss. The loss is added to the new shares' cost basis instead.
๐ฎ The game applies the wash sale rule with a window of about 14 hours either way, the real 30 days scaled to a one-week tax year.
Open the full entry โA tax loss carryforward lets you use an investment loss you couldn't use this year to cut your taxes in later years.
๐ฎ Losses cancel gains within the week. Up to $57.69 a week of a net loss reduces your taxable income (the real $3,000 a year spread over 52 weeks), and the rest carries forward to later weeks.
Open the full entry โ1929โ1950s
The Great Depression leads to deposit insurance, securities law, margin rules and modern economic statistics.
The Securities Act of 1933 made companies publish a prospectus before selling shares to the public and held underwriters responsible for its accuracy. The Securities Exchange Act of 1934 created the Securities and Exchange Commission and gave the Federal Reserve power to limit borrowing to buy stock.
๐ก Why it made sense then
In the 1920s buyers often knew far less than sellers. The laws aimed to put the facts in front of every investor and to curb the borrowing behind the crash.
Ideas it gave us
An underwriter is the investment bank that manages a new stock or bond issue, pricing it and selling it to investors in return for a fee.
๐ฎ The player who lists someone acts as their underwriter: they earn 1% of every buy in the listing's first week, paid by buyers on top of the price. Listings the game itself creates pay nobody.
Open the full entry โInformation asymmetry is when one side of a deal knows more than the other. It can cause adverse selection, where bad products or risks drive out good ones.
๐ฎ The house bots use only public information: prices, moves, trade counts and vouches. They never see your trades before they happen.
Open the full entry โBuying on margin means borrowing money from your broker to buy more stock than your cash alone allows, using your investments as collateral.
๐ฎ The bank lends for margin buys under Reg T, with a margin call if your own stake falls below 25%.
Open the full entry โSecurity Analysis (1934) taught investors to judge a stock by its earnings, assets and price, rather than by tips and momentum. Comparing a price with earnings per share became a standard yardstick.
๐ก Why it made sense then
After the crash, investors wanted a disciplined way to tell a bargain from a bubble.
Ideas it gave us
The price-to-earnings ratio is a stock's price divided by its earnings per share, showing how much investors pay for each dollar of profit.
๐ฎ Listed people have no earnings, so the game has no P/E ratio. Prices come purely from supply and demand, which is why a person's popularity and news move them.
Open the full entry โ1950sโ1990s
Risk gets measured, options get a formula, and index funds and ETFs bring the whole market to everyone.
In "Portfolio Selection" (1952), Harry Markowitz measured risk as the spread of returns and showed that combining investments that don't move together lowers risk for the same expected return.
๐ก Why it made sense then
Investors already said "don't put all your eggs in one basket"; Markowitz showed how many baskets and which ones.
Ideas it gave us
Diversification is spreading money across many different investments so a loss on one has less effect on the whole portfolio.
๐ฎ ETFs let you invest in a whole group of people at once.
Open the full entry โA portfolio is the full set of investments a person or fund owns, such as stocks, funds, bonds and cash.
๐ฎ Your portfolio page shows your holdings, cash, savings, options and net worth.
Open the full entry โAsset allocation is how you divide a portfolio among types of investment, such as stocks, bonds and cash, based on your goals and tolerance for risk.
๐ฎ Your portfolio in the game mixes shares, ETFs, options, cash in savings and farm plots. How you split them is your asset allocation.
Open the full entry โStandard deviation measures how spread out a set of numbers is around its average. In investing, it's the usual measure of volatility.
๐ฎ The game measures each person's volatility as the standard deviation of their returns and uses it to price their options.
Open the full entry โRisk tolerance is how much loss or price swing an investor can accept, financially and emotionally, in pursuit of higher returns.
๐ฎ The house bots each have a different risk tolerance, from SafeBot, which trades rarely and carefully, to YoloBot, which trades often and aggressively. Their results on the leaderboard show how each approach plays out.
Open the full entry โLaunched on 4 March 1957, the S&P 500 weights each company by its market capitalization, so bigger companies count for more. It became the most followed measure of the US stock market.
๐ก Why it made sense then
Computers made it possible to calculate a broad index quickly, and weighting by value better reflects what investors actually own.
Ideas it gave us
A market index is a number that tracks the combined price of a set group of stocks, such as the S&P 500 (500 large US companies), to show how that part of the market is doing.
๐ฎ Each game ETF is also an index of its group: its price tells you how that set of people is doing overall.
Open the full entry โMarket capitalization is the total value of a company's shares: the share price multiplied by the number of shares outstanding.
๐ฎ Every profile shows its market cap, and ETFs weight the people inside them by it.
Open the full entry โIn 1972 the SEC adopted Rule 144, setting holding periods and volume limits on how much restricted or insider stock can be sold at a time.
By the 1990s nearly every US IPO also came with a lockup agreement with the underwriters, most often for 180 days, during which insiders don't sell at all.
๐ก Why it made sense then
If insiders could sell everything at once, new public investors would be left holding the bag.
๐ฎ In Journey Shares
A claimed profile's escrowed shares are locked for 180 days, then can be sold only a little each day.
Ideas it gave us
A lockup period is a stretch of time after a company goes public, usually 180 days, during which insiders agree not to sell their shares.
๐ฎ If someone claims their profile, the 100,000 shares held in escrow for them are locked for 180 days. After that they can sell only a small amount each day, so a claim can't flood the market.
Open the full entry โOn 1 May 1975, fixed commissions on US stock trades ended, 183 years after the Buttonwood Agreement. Discount brokers such as Charles Schwab soon offered cheap trades.
๐ก Why it made sense then
Big institutions wanted to negotiate fees, and regulators wanted competition.
Ideas it gave us
A commission is a fee a broker charges for placing a trade. Most US brokers have charged $0 commission on stock trades since 2019.
๐ฎ There's no commission on game share trades, like most US brokers today. Sales pay the small SEC and FINRA fees, and options cost $0.65 a contract.
Open the full entry โA broker is a licensed firm that places trades on an exchange for you and holds your investments in an account, like Fidelity, Schwab or Robinhood.
๐ฎ The game works like a zero-commission broker: no fee to trade, but every sale pays the real SEC and FINRA fees.
Open the full entry โ2000โtoday
Trading moves online, costs fall to zero, and crises bring bailouts, quantitative easing and new rules.
Robinhood's app offered commission-free stock trades from 2015. In October 2019 Charles Schwab, TD Ameritrade and E*Trade all cut their stock commissions to zero.
๐ก Why it made sense then
Competition had pushed fees down for decades, and brokers could earn from interest and order flow instead.
Ideas it gave us
A commission is a fee a broker charges for placing a trade. Most US brokers have charged $0 commission on stock trades since 2019.
๐ฎ There's no commission on game share trades, like most US brokers today. Sales pay the small SEC and FINRA fees, and options cost $0.65 a contract.
Open the full entry โA broker is a licensed firm that places trades on an exchange for you and holds your investments in an account, like Fidelity, Schwab or Robinhood.
๐ฎ The game works like a zero-commission broker: no fee to trade, but every sale pays the real SEC and FINRA fees.
Open the full entry โ๐ฎ Practise with $10,000 in play money
Try it in a live 3D city with play money: trade shares in real public figures, get margin-called, pay your taxes and rob a bot or two. Free, and nothing real is at stake.
For learning only. This isn't financial advice.
