Friday, August 15, 2014

Trading With Stockpiles


Too much cash, not enough flow. 

In an earlier post about station trading I recommended that traders sell their acquired goods as soon as possible, so they'll make a profit right away and be able to put that money into something else. I still think this is good advice, but I've recently hit upon a different "mode" of station trading: trading from stockpiles.

My trading alt has too much money! I know, I know, nice problem to have :)  She was sitting on 3B ISK recently and my usual cash-burner, acquiring expensive Cybernetic Arms (500-700M a piece) and tattoos (100M to 600M each) wasn't working...my buy orders weren't getting filled. She also had about 4B ISK worth of stuff in her hangar: datacores, tattoos (the Prototype/Wreckage style) and some level 4 PI products. My PI production was on hold at the time, so I wasn't spending a lot on level 3 PI products for my factory planets, which is something that usually eats up a lot of money.

I could have been selling her items, but I reasoned that it wasn't worth it. All I would get is cash; cash that I couldn't spend on anything worthwhile.  I looked around for new stuff to invest in but didn't find anything expensive enough to make a dent in the cash pile. So, what to do?

I decided to wait. Specifically, I'm waiting for price spikes

Price spikes come along surprisingly frequently. Small Remote Armor Repair IIs, for example swung between 1M and 2M several times over just a few days. I bought a bunch at 1M, sold a lot of it at 2M...but it's currently at 800K, so I have to wait and see which way the swings will go next. There were opportunities to sell at lower prices, or to panic and get out when the price dropped, but patience has paid off.

The price of the Gallente Datacores I own is strongly influenced by the Faction Warfare standing of the militia. They're at Tier 4 now, so the flood of those datacores has finally started to push the price down. The price had stayed surprisingly high while we were in Tier 3 and I managed to sell a lot of datacores around the 150K each mark, or higher. Patience paid off here too, though it was a long wait for these to go up from the 100K or so I paid for each of them to the 150K I sold them for.  I'm going to look for opportunities to buy the Caldari Quantum datacores - they have spiked to over 200K a few times.

The last example is Vaccines, which I bought in vast quanties for about 40K each before Crius. I sold a lot of it off before the new Industry system came out, waiting to see what effects it would have on PI. But I still had a good amount left at Jita, about 12,000 units. The price dropped below 40K and I held on to my stock. Sellers started to dwindle and the cost of Sterile Conduits, the P4 item that Vaccines are used in, surged by about 50%, from 600K to 900K. The few people selling Vaccines got cleaned out...and in steps me, Johnny-On-The-Spot. I put one-third of my stock up for sale at 60K and it's selling steadily. I'll wait and see what happens next, but I think I can raise my price to 70K and still find buyers.

Edit: Update from 8/18/2014: I had a stockpile of Balmer tracking disrutors, obtained cheaply on buy orders. The Jita sell price has been hovering around 800K for a while, but I waited, and yesterday it spiked to 1.4M. I've sold a dozen or so, and am trying to get the rest out while the price is high.

The vaccines price dropped to 57K and I've decided to use them in the manner they were intended; making Sterile Conduits, which are holding their price in the high 800K range. Their usual range is 600K.

I also saw a price spike in meta 4 damps (Phased Muon) and sold my stock into that spike. I went a bit early, though, and the price rose even higher. Never mind, it was still a very nice of 1M on each item.

Moral of the story: be prepared to change your investment rules if you think you can make more money in a different way.

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A nice industrial thing happened yesterday. Our corp needed to quickly acquire some rigs, and it so happens that I'm set up to make a lot of rigs. The market price on these items was pretty high and I was able to quickly tell the boss that we could make them a lot cheaper...80% below market price! Pro-tip: a lot of rigs are sold at crazy markups; you should get in on that! I got the BPOs (that was my alt's first trip to my main's station) to my main character's factory and started 5 lines running. It's nice to be able to help your corp in new ways.