click fraud?

Discussion in 'Wall St. News' started by keyser1, Mar 6, 2006.

  1. keyser1


    Whats the difference between click fraud and dvr fraud? People act like click fraud is going to ruin the entire search industry.

    Has the fact that people change channels during radio/tv commercials made the neilson ratings obsolete? Has the fact that people can now record a show on their dvr and skip all the commercials brought the tv ad industry down?
    No? Why not? Because advertisers know that not all viewers actually watch/pay attn to their commercials and pay a little less then they would if they could guarantee attention.

    The same thing with google. If advertisers think x% of clicks are fraudulous, they'll bid less on their keywords. If they really are fraudulous, they can ask google to investigate and if its found true, they'll get a refund.

    The greatest thing about online clicks as opposed to any other form of advertising is you know right away what % of customers came from the ad.

    anyways thats my rant on click fraud. really not much different than any other type of customers-not-paying-attn-to-advertisements.
  2. Sanjuro


    Click fraud is advertising links that are clicked not by actual consumers who are interested in the ad.

    There are automated programs that can record scripts against web pages. Add a timer and some logic and you can have a computer click hundreds of ads an hour without even having a real person there.

    I bet over 1/4 of Google's revenue comes from click fraud unless they check for unique IP addresses. But why would they want to check for fraud when that would decrease their own revenues since some companies pay 23 cent per click.

    To the trader, click fraud doesn't really matter. :) As long as Google continues to have these great 10 point daily ranges, Google will be one of my favorite stocks to trade.

  3. jrlvnv


    Can you please explain the difference trading a 400 dollar stock with a 10 point range and a 40 dollar stock with a 1 dollar range? Why would you rather trade the 400 dollar stock? Thanks for all that reply
  4. Sanjuro


    There is no difference except one.

    If I buy 500 shares of GOOG, I would have to buy 5000 shares of a 40 dollar stock.

    Commission is $2.50 for GOOG and $25 for 40 dollar stock. And the 40 stock needs to have enough volume for me to get in and out 5000 shares within a 1-2 cent level.

    I wouldn't trade one over the other as long as the stock meets my requirements (volume, volatitliy, ...). I do trade both. I trade a 40, 50 and two 60 dollar stocks in addition to Google.

    I do wonder why some traders are afraid of trading GOOG. Since it has a higher trading range, use a smaller number of shares and it's the same thing...

  5. The volatility on a $400 stock is MUCH higher than on a $40 stock with $1 range. You can easily be on the wrong side of every trade. It's like trying to ride a wild bull! With the $40 stock, entry points are much calmer and you can really minimize your losses. It's easier to trade. I wouldn't trade YHOO unless you are well capitalized enough to weather the P&L swings.
  6. GOOG 410.18 353.38 Buy 14.49 (*)

    (*) Marginal Entry --------->
    Buy at 353 to 353-14.5
    another at 353-14.4-14.5
    for next fivae trade days..U'll be ok
  7. Sanjuro


    $10 range on $400 stock is the same as a $1 range on a $40 based on percentage. 10/400 = 1/40

    It's the same volatility if you use 500 shares with a 2 point stop and when you use 5000 shares with a .20 cent stop.

    It sounds like you use the same .20 cent stop for Google that you use for a 40 dollar stock. That would not be a good idea.

    The stop should be based on logical values such has high and low of opening range, intermediate highs/lows, recent consolidation levels and etc...

  8. Volitilty=%
    Not Magnitude...
    to compare variation use Excel function
    =stdev(< Your Range here>)
    say goog closed at 400...the day before closed at 385
    then on the first data in Rnage 400/385 on...need about 40 to 50 days to commpute accurate daily stdev

    do a couple of stocks...then use so called Relative Variation..
    for example
    all stdev <100%...
    but the most volitile stock is about 10% daily
  9. dis


    I use Google extensively, buy never click on their ads. I suspect that most clicks are generated by bots.

  10. I agree except for one thing. When your .20 cent stop on the $40 stock is hit, you can get out while only losing .20 cents. When your 2 point stop is hit on a $400 stock you'll most likely lose an extra dollar or two! OUCH!
    #10     Mar 8, 2006