Swine flu, drug firms, SEO blogging
April 29, 2009
While governments around the world are seriously concerned about Swine Flu, stockholders of pharmaceutical companies, on the other hand, are seeing a silver lining in the possible outbreak of the disease.
In last Monday’s (April 27) trading alone, stock prices of drug firms in the US increased with the expectation that a swine flu outbreak will lead to higher profits for the drug makers.
Take, for example, GlaxoSmithKline (NYSE Stock Code: GSK) — maker of the flu drug Relenza which is seen as a possible medicine treatment for the swine flu. On Monday, the stock price of GSK closed at $31.56, up by 7.6% from last week’s close.
Another pharmaceutical company, Pfizer (NYSE:PFE), saw its shares rise by 2.4% on Monday alone.
The graph shown here presents the 1-day fluctuation in prices of Pfizer and GlaxoSmithKline on the first trading day after the swine flu outbreak in Mexico hit the news.
Trading the News
This underscores the philosophy of “trading the news” which some stock traders are following. Basically, this assumes that stock prices can fluctuate depending on certain news and issues affecting a company. If you are a keen trader, you can easily profit if you know what news can move the prices of your stocks.
In the case of these pharmaceutical firms, the expectation that the swine flu outbreak will lead to more production of flu drugs translating to increased profits for the drug firms pushed the stock prices of GSK, Pfizer, Roche and other drug companies higher.
Interestingly, there is a similar strategy in the world of blogging. Search Engine Optimization (SEO) bloggers are using what they call “keyword hijacking”. What “keyword hijackers” essentially do is forecasting what people in the future will search the most then creating a landing page that targets that keyword.
For example, if you expect a lot of people to search “how to watch online free Manny Pacquiao – Ricky Hatton fight” in time for the May 2, 2009 boxing fight, then you would create a blog post particularly targeting those keywords.
If that post is properly optimized, by the time people start searching those keywords in Google or other search engines, your blog post will be on top of the search results. Higher position on the search results means more visitors to the site which means more income for you.
Predicting the Future
The challenge, then, whether you’re a stock trader or a blogger is to accurately predict the future.
If you know how some news can affect stock prices, you would know what stocks to buy or sell.
If you know what people will be searching in the future, you would prepare for it by creating and optimizing a blog post now.
Whether you’re trading the news as a trader or hijacking keywords as a blogger, acute foresight and vision is what you need to succeed.
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