Market showing signs of recovery – 11 A.M.

TDNAM prices are back to pre-crash values. By better understanding what led to this crash, we may be able to better understand when such crashes are likely to occur in the future. Black Friday showed us how connected even domain names are to the economy as a whole… Thanksgiving showed us how rapidly prices can plunge when demand levels off.

 Moving forward, I think many sellers learnt a valuable lesson in Investing 101. A “three steps forward, two steps back” approach seems to be the very way this one will go. Undercutting each other in an attempt to sell during a trough is not the solution. The solution is to put your names back in the Vault. These names are a medium to long term investment. You shouldn’t be trying to make a career day trading them. If you want out, then sell. Now’s a good time, seeing as they’re back at their peak..

It’ll be interesting to see where the market goes from here… Still several weeks until Xmas… We need to find out more information about our average holder so that we can better understand what influences them. A member on Namepros recently speculated that the average domainer is a young male. I agree with that hypothesis and demand picking up right when it did would seem to reinforce that hypothesis…

So, what impacts a young male’s spending patterns? In short, what would cause an investor to jump ship, buy more, or stop buying (but not begin selling)? Those are some very important questions we’ll need to find answers to, assuming the above hypothesis was correct.

Young domainers as a whole are collectively more impulsive. Not all of them are, but you do see alot of 15-20 year olds looking for a get rich quick scheme. If they saw LLLL.coms continue to rapidly appreciate in price, rather than sell them, this group would likely be compelled to buy more. The converse is also true… If prices started to rapidly decline, these are the guys who’ll most likely panic and jump ship. They don’t have the background in investing that someone develops over a lifetime. This presents an opportunity for great bargains. I’ve let several members of Namepros with large portfolios (300+ names) know that I’d be happy to take the names off their hands for regfee++ if they cannot afford to renew the names. Better to get $10 for each than zero, right?

 Can we expect events like Spring Break to influence demand for LLLL.coms? I believe Summer ’08 will be particularly painful for many of these younger investors who’ll be trying to both secure a summer job to pay for their education and simultaneously raise the funds necessary to renew their LLLL.coms which are expiring shortly thereafter…

I guess we’ll have to wait and see… I just might start a poll on Namepros… I’m somewhat curious what the age of our average investor is myself. And as the above elucidated — knowledge can very well give you the upper hand in making informed decisions about when it’s best to exit a market.


~ by Reece on November 26, 2007.

2 Responses to “Market showing signs of recovery – 11 A.M.”

  1. I fall in the “young male domainer” demographic — I turn 18 early next month. I first got into domaining back in March when I found that ( was taken and I placed a backorder on it. I wasn’t entirely sure what a backorder was and I was curious about the logistics of the drop process (although I didn’t know it was called that back then), so I did some research and started picking up some domains here and there.

    I was a bit late on the bandwagon — I didn’t realize how quickly they were disappearing until I stumbled upon NamePros in early October. I only regged a dozen or so before the buyout, and I’ve since picked up a few cheap ones on the aftermarket (a high school student’s budget can only go so far).

    LLLL.coms aren’t all I have, though. I’m a fan of .cc and I’ve got a handful of premium LLLL.nets and some CVCV.infos in my portfolio as well.

  2. Not all us young people panic when investments are going wrong. I’m 19, and I don’t plan to even consider selling these for a long time.

    With around 100 each of LLLL and L-L-L, I’m in it for the long haul. Sure, renewal time is going to hurt each year, and put a massive dint in the savings, but I figure it will be worth it in a few years. I haven’t even looked at people’s threads for selling, and didn’t realise there was a crash!

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