Bottom line:Just as Activision's games are for thrill seekers, the stock is, too. Investing in Activision shares will be filled with excitement, fear and suspense. It's definitely not a stock for someone looking for a slow-and-steady investment. Video games are a hit-driven business, and having a hot title one year can mean huge profits. Similarly, if the pipeline of hit games dries up, a video-game stock can suffer quickly.
As the current downturn shows, Activision's management knows better than anyone how to navigate the industry's vagaries. But as an investor, you need to be fully aware of the risk you're taking when buying Activision stock.
Matt Krantz is a financial markets reporter at USA TODAY and author of Investing Online for Dummies. He answers a different reader question every weekday in his Ask Matt column at money.usatoday.com. To submit a question, e-mail Matt at firstname.lastname@example.org. Click here to see previous Ask Matt columns. Follow Matt on Twitter at: twitter.com/mattkrantz