Umoo offers fantasy stock trading for those who don't want real losses

If you can’t make money in the real stock market, you might try the fantasy stock market. For those who don’t quite have the stomach for real-life trading, Umoo has created a fantasy stock exchange where you can play with real stocks but make much smaller bets.

It’s kind of a social networking game for stock pickers. With Umoo, you create a faux brokerage account and buy virtual money with real dollars. You can then enter tournaments where you put your virtual currency on the line. In the first nine months of beta testing, Umoo has handled more than 2 million trades, with as many as 50,000 trades in a day sometimes. The platform mixes real stock market data with the ability to compare your picks against other players in tournaments.

You risk losing your entry fee of $2  – $50, but you aren’t going to lose your entire fortune with a bad stock pick. In any given tournament, you don’t have to worry about the stock market going up or down. You win the prize if you can just do better as a stock picker than the other players. A typical prize pool is maybe $16. Umoo takes a commission, perhaps around 12 percent, but smaller if the the pool is bigger, said Yariv Kafri, executive vice president, in an interview. Tournaments can run for a few hours or up to 30 days.

It’s actually a pretty good way to learn about picking stocks, given the handy dashboard for analyzing stock information. You can look up real analyst research on companies and take tutorials. If you have no clue what to buy, you can play the “stock machine” which picks stocks for you.

The platform has all of the exchanges available, from the New York Stock Exchange to the Nikkei. And it’s certainly better to gain experience playing Umoo’s fantasy markets than it is to commit tens of thousands of dollars to the real stock market. Because winners of the tournaments get prizes, Umoo is considered a skill-based game, legal in many territories but considered illegal gambling in some U.S. states.

The top 100 players have earned over $500,000 in winnings to date. The top player has actually won more than $75,000. (Yes, it’s probably time for that player to start a talk show). There are thousands of players paying to participate. You do have to be an adult to play. About 90 percent of players are male. Kafri said that one encouraging thing is that about 30 percent of the players have never played an online game before.

Umoo has raised angel funding to date. The company was founded in Israel in 2005 and now has 14 employees and an office in New York. Kafri said the company is now looking for new ways to monetize, such as ads or special offers.

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