This week was the first full week of our new investment group. Currently I am trading on behalf of 6 other players and paying out 475 million isk in interest every week. The added funds have been instrumental in reaching my best trading week ever. It was amazing to see how well trading scales as a means to earn isk.
During the week, I had around 6 billion isk in play in the markets, and am poised to earn close to, if not more than, 800 million isk. If this trend continues, then I should be able to pass on the earnings and raise the weekly interest rate to 12%. I do not use trading profits for day to day expenses; they are intended to be used for larger purchases of non-consumable items such as blueprint originals and structures. This allows me to be more generous with the pay outs.
I received an eve mail this week concerning the investment group and was asked about the necessity of trust when it comes to managing other people’s money. I thought this was a very good question and displays one of the finer nuances of market play in the game.
Currently, there is no safe way for players to “buy” the time of traders and expect a portion of earnings in return without having to hand the trader capital to use in market dealings. If I did not have friends who trust me with their money, would I ever have the chance to trade on other people’s behalf? Honestly, no. But is trust the only option for group market play where one player engages in market activity for the benefit of others? Again I would say no. This barrier to entry has no direct in-game connection and is purely based on how a player is perceived regarding their trustworthiness.
I believe that the player base has matured enough over the years to be able to manage proper financial mechanics that would promote group play and offer some sort of assurance of good conduct. The usual way to ensure this good conduct is through effective use of collateral. However, putting up 100% collateral against capital for the purpose of investment will not motivate a trader. Effectively, traders will have to put up the same amount in collateral that they would have received from an investor. If they already had the money in the first place, then they did not need the isk injection into the operation.
Equally, putting up less than 100% collateral will incentivise simply walking away with the investor’s capital, since the loss of the collateral will be less than the money received.
There is value in pursuing a solution to this problem. If trust, as a barrier to entry, is the problem, then can we solve it through a change in game mechanics? Ultimately, I think the argument will circle back to needing some sort of collateral. The real question is how to implement a system that would be objectively fair to both the investor and the trader.
Personally, I cannot offer a solution at this time. However, I would love to hear about any comments or suggestions on the subject.
Now let’s see how did this trade week.
As far as the number of items traded in a single week, this has been my most plentiful. In order to cover more ground, I decided to continue to trade in subsystems and advanced / processed materials.
Apart from the usual station trading in Jita, I am now starting to seed Fortizars outside The Forge. For starters, I have been seeding items in the Botane Fortizar in Sinq Laison region. I am setting the sell orders to beat Dodixie and managed to complete a fair number of orders even on the first day. If this continues, I will seed other spoke market hub Fortizars to see how viable the sell markets are for those regions.
If I am fortunate enough to attract more investors, I will have a closer look at the materials market and see about creating a way to leverage those items as an index to base mid-term investments on. Those items will require less babysitting than the usual week-long trades that I engage in.
Thank you to all the members of the investment group! Good luck everyone, and happy trading.