One of my players has proposed taking his nuyen and investing it as stock in a megacorp. I'm inclined to allow it, but I have only fuzzy knowledge of how the real-life stock market works, let alone that of the Sixth World.

Is there any information out there on what stock in a megacorp is worth and how its value fluctuates over time?

Stocks are an investment in a company. Stockholders receive a share of the company's profits in relation to the # of shares they hold compared to the total issued shares. I.e. if I hold 100 shares of company X, and there are 10,000 shares total for that company, I receive 1% of that company's NET profit as a dividend.

Stocks can also be used as an investment by speculating on their share price. I.e. to buy 1 share of Stock X today costs $10, tomorrow it might cost $11, thus netting you a 1 day gain of 10% in value. This gain or loss in stock value is typically tied to the valuation of the company. Companies that are thought to be doing well, see their share price increase, while companies that are seen to be doing poorly will see their stock value decrease.

There's a lot more to it than this, as the nuances are staggering, but those are the basics. There are different types of stocks (some that give extra voting rights but fewer dividends, etc.), and other vehicles (futures, options, etc.), and strategies (shorting).

I'd say have the value of whatever they invest increase/decrease based on an Edge roll X%, or just pick some percentage (2-5%) for their investment to increase (or decrease) each month. For a major megacorp, stock price movement would be small. And maybe they'd earn 5-10% of their investment yearly as dividends.

While I'm all for investing in a megacorp (Sounds like a neat idea from a roleplay perspective), if he wants to make nuyen in a similar fashion while minimizing potential losses, he'd be better off doing Foreign Exchange... assuming any other money besides nuyen actually means anything.

Or just buy Nuyen versus UCAS $.. and make some easy money?

However the guys who wrote SR don't understand how corporations actually works, so some of the megacorps are effectively privately held. For example, SK is a sovereign entity. There are no SEC rules that apply to them. How much profit do you think SK delivers to the stockholders vs "bonus pay" to the CEO?

Just because they're sovereign, doesn't mean they don't have publicly traded stock. The reason a company gives out stock is because it's an easy way to raise investment capital, and distribute risk. If they don't choose to abide by the rules of whatever market they're opting to trade on (be it UCAS, CAS, etc.), they can't issue stock there. There are some megacorps that are family owned, which just means the family members own all the stock.

And there are plenty of reasons they don't need to pay out large dividends. Many companies don't: they 'reinvest' any profits, giving only a nominal dividend. And never mind the different classes of stocks that might give larger dividends, but are only owned by certain individuals.

BTW, IIRC, the old Corporate Shadow Files had some information on stocks and financials and whatnot. Not sure how good or relevant it still is.

That runner better have a really good fake SIN if he expects to buy large amounts of mega stock, and be very careful to never tarnish it. One failed SIN check on it and goodbye retirement fund.

Since the corp writes their own rules, I'm sure the Board of Director's makes very sure that stocks, dividend payments, and voting rights are VERY secure. Besides the massive risk of capital flight if a company started seizing shares or screwing with dividends.


QFT

There's no reason a shadowrunner, especially a SINner, can't own shares but there's rarely a good reason. A 15% annual return is pretty darn good but I've only been in one game that lasted a (in-game) year and then an investment of :nuyen:100,000 will net you a whole :nuyen:15,000. Almost every shadowrunner is better off buying equipment. I recommend giving 1% monthly interest. That's a good return, it' simple, and it's basically the same system the game uses for buying lifestyles. The best reason for a runner to buy stock is to get stockholder reports from the company, it's not going to include any of the really good stuff but it's an excellent primer on what each corp is up to, worth a knowledge bonus at least.

Umm, if you control 51% who cares what the other stockholders do with their stock?

In fact, in the real world there are all sorts of legal protections against majority owners (which can be a group that forms a majority) from self-dealing. The majority has a fiduciary duty to the minority shareholders, etc, which the government usually enforces. But sovereign entities make their own rules. It's what being a sovereign means. There is no "controlling legal authority". You can't sue them unless the choose to allow it, etc.

Off the top of my head, no one in Ares, Renraku, Neonet, or Shiawise has anything close to 51%. Aztech and SK are intentionally vague, although the Azzie board is divided while the SK one is basically an extension of Llowfyr (whether that's 'cause of stock ownership or dragon trickery is unknown). I can't remember about MCT, Horizon, or Wuxing but Wuxing would be your best bet for a company with 51%+ owner. I'm pretty sure Evo's controlling shares is split between Buttercup and that young ork who inherited.

Capital flight will devastate any company, since few of them keep any large monetary reserves and are therefore dependent on short-term loans for many of their operations.

And there is a controlling legal authority for shareholders, the Corp Court. Since corps run the world, stock ownership is probably the most important issue in the world. The Court is going to take a dim view on anything that might jeopardize that. That's why Dunkie can own Azzie and Ares stock, stock has to be sancrosanct and the authority which has to enforce that is the Corp Court.

Buttercup and Yuri Shibanokuji own 51% of EVo so if they agree on somethink they can make it happen without anyone else having any say on it.
SK is a private corporation solely owned by Lofwyr.

Thanks for the info Max!

Two thoughts on SK:
#1 That's impossibly stupid. Ok, it's not impossibly stupid and I get the idea that Llowfyr is in complete control of SK but really, complete ownership? This is going to sound odd in a game with magical dragon presidents but that's extremely hard to believe.
#2 Wasn't there an old lady, Graf Beloit or somebody, who owned SK before Llowfyr bought it and turned it into SK. She has an entry on Llowfyr in Threats. I understand he took a controlling interest in the company but how'd he ever get here to give up her stock?

If he is a shadowrunner, he is probably interested more into the short term profits from trading rather than the dividents. Shareholder reports should be easy enough to get without being a shareholder. Also there surely won't be any really useful info in there.

I'd suggest trying to use it as a 'profit multiplicator'. Especially when focusing on smaller corps, a shadowrunner can surely influence the stock prices by leaking information from runs.
Trashed that top secret lab and they try to keep it secret? Leak some info about it and make it look like the info came from an employee. -> prices drop
Stole a lot of research data about new tech? Leak that Corp A had something in development but the data was 'lost' in the recent fire in their lab. However, Corp B is rumored to have something similar in production and is close to releasing info about it.
Or somehow make it look like big Corp B wants to buy smaller Corp A?

If the runner does it well, he might earn some money. If they find out he is in trouble, loses some money and it might be time for an escape run

According to corporate shadow files Lofwyr walked into scene in 2037 with 63% ownership, after that he pulled of a management buy-out,through witch he snapped up all the remaining outstanding stocks.
In 2040 hints emerged that he had given or sold some, but no one knows who(or what) owns what percentage of SK.
Corporate Downloads (dated 2061) lists Lofwyr owning 100% of SK.

This is mostly because Shadowrun isn't our world, it's a pseudo post-apocalyptic distopian world. It's the future according to the 80's where life is cheap and following the rules is for suckers. In this world where the universe wants the bad guy to win, regulation of any sort is out the window when every Senator is for sale and the current president probably helped kill the last one.

To answer the question of players buying stock, try your search-fu. There are half a dozen posts on this in the last year and at least one in the last month.

But since you asked... making money of a stock short term is like going to a casino. Making money long term is more like owning the casino. The odds are more in your favor for the latter, but there is always a chance something will go wrong.
So, unless your player has some sort of secret, insider trading knowledge of the stock he wants to invest in, just say his return is consistent with a cost of living increase, because after fees that's what most 401ks do for short term investing.

I would wager what he wants to do is sell short on a stock before a run, like selling off all his Renraku shares before a run blowing up a Renraku building and that sort of thing. Unless you want to give your player a money printing machine, remind him that in the 6th world no mega-corp's stock is so shaky that it will drop any significant amount because of one run. Were that the case there would be almost no economic stability in the world, which would cause a massive government intervention, as we have recently seen.
But in Shadowrun it's the opposite. Governments have limited power while corps have more, implying a robust, stable economy, at least for the higher earners of the world while we on the lower rungs get hung out to dry. So, you know, Reaganomics.

As I said, future according to the 80's.

Megacorporations are not sovereign. For Evo, Horizon, Wuxing and all AA megacorporations, all it takes are a majority on the Corporate Court and a vote and they lose all extraterritorial privileges and must obey anew to the law of the land wherever their operate. The Business Recognition Accords say that, and they're binding as an international treaty. That's not being sovereign.

For Ares Macrotechnology, Aztechnology, BMW, JRJ International, MCT, Keruba International, Shiawase, it would require to amend the Corporate Court status that state founding member always retain AAA rating, but the effect would be the same. If Saeder-Krupp sells BMW, Neonet sells JRJ, or Renraku the Keruba consortium, it's also over (that's what happened to Fuchi when President/CEO Richard Villiers sold JRJ).

Echo that. It is even more important as megacorporations themselves are shareholders of their subsidiaries. If shareholder rights are not strictly enforced, there is no possible takeover, and any subsidiary could actually decide to secede.

That's a common feature of Shadowrun universe. The megacorporation always manage to buy what they want. Rarely the owner manage to sell to someone else or simply say no. Corporate Download suggests Lofwyr directly threatened Wilhelmina Graff-Beloit though.

IRL, the regulation in several countries also a majority shareholder past a certain point (usually 90 or 95% of the stock) to make a compulsory offer to buy out the last remaining minority shareholders.

There's no good reason for a Shadowrunner to be stock trading.

For the legal hurdles and aggravation he has to go through, the amount of profit he might realize isn't worth it, especially compared to the profits he is likely to get conducting the illegal activities as any sort of halfway successful Shadowrunner.



-k

Well, actually, with smaller companies, there is an expcetional reason for a shadowrunner to be stock trading. You'll never move an AAA with a run, but a lot of those smaller companies and start ups you certainly can. Granted, its a lot easier to move them down than up...but meh. With a margin trading account and some self-starting runs, the profits you can make from shorting proper targets would be massive. Say word is out that a Horizon Subsidary is buying up Game Company A, a small studio worth 25-30 million, but they're skyrocketing with the pending merger...short a ton of shares at the top of their game, then when your runs go in and wreck house..and against a company that small, a good team could wreck house in one night, if they planned it out beforehand...you set your rebuy at half or whatever.. that's a 100% return on investment.

Ares is controlled by 3 people. Shiawase, Wuxing and Mitsuhama are controlled by 5 people.

Well, sure. Actually pulling it off is a bit harder. How do sovereign governments deal with secession?

The most recent (substantial amount of) information on her that I recall reading was in Dragons of the Sixth World, in Lofwyr's "Enemies" section. I seem to recall reading that she had died in one SR4 book or another, but it was only a few lines, I think, but then, I could be misremembering on that point.

This somehow gives me ideas for a run where the runners are hired by a stock trader to ruin a competitor. Maybe they are both independent traders and are competing for a certain customer. Or maybe they are working at the same company and trader A wants a promotion that trader B has the best chances for. Find out what smaller corps he invested in heavily or maybe even talk him into investing into something special and then wreck that place he invested in. Maybe that guy had investied some mob money and they aren't pleased with him losing their money?