Stock and Domain Names
There are a number of parallels that can be drawn between investing in domain names and investing in the stock market. You can make money from stocks by buying low and selling high and by pocketing the dividend, if any, paid out on the stock during the time you own it.
Similarly, the primary profit in most domain name investments will be unlocked at the time the domain is sold or leased. Even a relatively minor transaction can yield a several thousand percent profit. After all, at $10 a registration, in the case of a new domain, it doesn’t take much to make a profit. At the same time, if the domain name is receiving even a modest stream of targeted traffic, this can be harnessed and turned into an ongoing revenue stream while you wait to complete a transaction for the domain (essentially, this is the “domain dividend” of owning that domain.)
There are also a number of significant differences between stocks and domain names. For instance, there is a well-established market for stocks with firm prices agreed upon by a large number of players – a liquid market in which stocks can generally be bought and sold at any time. The domain name market is far more nebulous, with many players and few rules. It is a highly illiquid market with no guarantees that a particular domain name can sell in any given time frame, or indeed, at all.
By now, you should have noticed a pattern emerging. Stocks, while by no means a safe investment, are very low risk when compared to domain name investments.
Domain name investments are ultra-high risk,. They have the potential of a very high return on investment for the right domains, if a buyer can be found, and the prospect of losing the entire value of the investment if one can not. The latter scenario is by farthe more common one as most people buying domain names to resell end up losing much or all of the money they invested.
(Written by Igoldrush)