May 15 Worried that if you buy Facebook when it
starts trading Friday you'll get trampled by big banks and hedge
funds? Betting on where the stock closes that day may be a safer
Intrade, the online prediction market where investors can
bet on numerous events, from movie box office receipts to the
U.S. presidential election, started a contract Tuesday for bets
on where shares of Facebook will close on Friday, their
first day of trading.
The hotly anticipated initial public offering has sparked
intense interest from investors big and small. Facebook has
raised the expected price range for its shares to $34 to $38,
and many expect the shares to make a big move in that first day.
That could be perilous for individuals. If the stock
explodes on Friday, the average person might end up getting an
order filled at a price much higher than he wanted as funds
steamroll in and then zip back out.
Demand for the stock is expected to be enormous, which could
buoy the price throughout the session and into next week,
Dublin, Ireland-based Intrade is offering contracts that bet
on the stock closing anywhere from $25 to $60, at $5 intervals.
There were only a few bids in the early betting on the
One of Intrade's more popular contracts revolves around the
2012 U.S. presidential election. More than 241,000 shares have
traded in President Barack Obama's contract, and nearly 200,000
in Republican nominee Mitt Romney's contract.