Over the past few weeks, I’ve been getting private messages regarding trading tips and best practices. I did my best to answer the questions. However, the conversations were actually very revealing of how seemingly unorthodox my approach to trading has been.
Often, the questions revolved around what I traded in, where do I sell goods, and how much isk would be a reasonable starting capital to take on trading as an in-game occupation. These are all very good questions, but a bit superficial. Perhaps the single most powerful concept I tried to employ with my trades over the months has been the idea of leverage.
When I first started in April, I began my trading adventures with a starting capital of 2 billion isk. I didn’t think much of this; considering my age in the game, this is actually a pretty paltry amount. I never thought of my starting capital to be the edge I would need to be successful. I needed to attack from a different angle. I knew that I was only a little fish in a sea of whales. Instead of trying to out-muscle my competition, I had to be smarter.
START WITH WHAT YOU KNOW – Having been a FW player for over half a decade, I was intimately aware of what flew and died in low sec. In order to find out what players are using in this space, I need only to open my combat log and review the kills and losses. Using this information, I checked the market to see the volume and prices of these items. Daily volumes were incredibly anemic but the price was easily 20% over Jita in some cases. In this instance, I took advantage of my knowledge of the space, what players fly, and the local meta, to profit in the regional market.
LEG WORK – Expanding on the exploitation of desolate border markets in the warzone, I investigated the viability of other regional markets on the other side of the conflict. That took me to the Minmatar hubs of Hek and Rens. Although much farther off than the previous market hub I was exploiting, Hek and Rens saw much better volume of the same items I was already trading. However, in order to take advantage of this, I had to transport relatively high-value goods across more than 20 jumps of not-so-safe highsec.
In order to take advantage of this strategy, I had to take the time to finish training transport ships on one of my trading toons. The effort of hauling was worth it. This shift in my trading practices allowed me to nearly double my starting capital in a few short months. The extra work involved with exploiting larger markets gave me an opportunity to realistically take a crack at the big show – Jita.
SOCIAL NETWORK – Once my capital grew, I started trading almost exclusively in Jita. At this time, I thought the added funds would garner me better results, since they would allow me to capture more items to sell in the largest hub in the game. The first two weeks of this resulted in less profit than I was used to in the smaller hubs. I was overwhelmed by the competition over the high-volume items that I chose to trade. After some adjustments, the results got better, but I was still not at a level that would allow me to actually do this more passively.
I reached out to my friends in the Neocom and in our general Discord channel. Ultimately, I was given an opportunity to start trading with other people’s money. Very quickly, I found myself managing over 10 billion isk. After a few profitable weeks, I started getting contacted by other players thanks to the weekly articles that I write.
I believe my willingness to share trade ideas and plans for my operation made me approachable among traders. Historically, traders are very secretive. My going against the grain gave me an opportunity to share my skills with other players, and even be more competitive in the market. I was willing to open my trading to public scrutiny, and let other players take a part in the market via my operation.
The single greatest reason for my exponential growth came not in the form of tremendous starting capital, insider information, or meta gaming. It came from interacting with the greater community and sharing methods that may have been unknown to many players. With that social exchange, I have found generous benefactors whose wealth I seek to increase. By opening myself up as a trader, I now find myself on the brink of managing assets that can rival the coffers of some mid-sized alliances in the game that I know of.
The greatest thing I leveraged to get an advantage in the trading game was not isk or skill points. I got ahead because I conducted myself as a reasonable and friendly person in a cut-throat space game.
INVESTMENT GROUP UPDATE
This week was pretty volatile. We consistently had double-digit billions of isk on sell orders, but they simply weren’t getting matched at the pace of the previous weeks. Fortunately, we still managed to earn enough profit to comfortably make payouts and make it to one of the leader board categories.
You can see that cash on hand dramatically increased. This was due to liquidation of assets in order to prepare for more consistent Plex trading. One of our investors suggested creating a sort of fund that other investors can contribute to. I think this is a pretty good idea and Plex may be the best vehicle for this future investment product due to its relative stability and high volume.
I will develop this idea in the coming weeks and present it to our investors once I can intelligently articulate the finer points of the product.
Now let’s see how we did this trade week.
The biggest change we applied this week was focusing on lower volume / higher return items such as deadspace modules, marauders, faction navy ships, and Plex. The gamble paid off and it helped to offset the volatility of the cheaper items we have been trading the last couple of weeks.
A big surprise was the T3 subsystems. The saturation of T3 cruisers and destroyers seemed to not have a great effect on the volatility and pricing of the subsystems. I was expecting the subsystems to follow suit with the respective ships they are used on, but they have surprisingly kept their ground, at least for now.
I will continue to play these higher-ticket items in conjunction with utilitarian Amarr faction modules. Looking at the isk – loyalty point ratio on some of these modules, they may be a good buy while Amarr loyalty points are still suppressed due to their lack of war zone control.
Thank you very much for reading. Good luck and happy trading.