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Feronia
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Posted - 2005.06.01 15:32:00 -
[1]
Edited by: Feronia on 01/06/2005 22:56:26
Magma Industries is proud to announce its first market manipulation project is finished with succes. After watching many attempts to boost the price of minerals, like morphite in January, or ship modules, like the RCU II in March, we decided to start our own project in this field.
After consideration we picked a very common mineral, which is available all over Empire Space, to be our primary target: Isogen.
It took nearly a month of preparation, building up stocks and monitoring the market, but early March, the graphs showed us upcoming potential and we gave it a green light. The first weeks were critical, but once the ball was rolling, only thing we had to do was push it harder and further.
The initial idea was to boost the price with 50 % in 2 steps. The first phase would end at a price of 105 Isk. We planned to take a break after this, letting the market adjust and giving us time to restock. But the market decided otherwise. The ball kept rolling and the second phase was initiated immediately.
Despite a declining mineral market, we managed to boost the price from a pricelevel of 85 Isk early March, to 128 Isk early May. We stopped intervening in the isogen market 2 weeks ago, so we expect the ball will stop rolling shortly.
For this the Magma Index was put on hold, because we don't consider it opportune to run them both at the same time.
After a few weeks we had expected a lot of posts about the Isogen price on the forum, but surprisingly everything stayed quiet. We never understood why people accept such a drastic priceboost when nothing has changed in the availability of isogen. Even worse, they accepted it at a time all other mineral prices were declining.
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Raaz Satik
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Posted - 2005.06.01 18:15:00 -
[2]
Congratz on the experiment
 Originally by: Feronia
The initial idea was to boost the price with 50 % in 2 steps. The first phase would end at a price of 105 Isk. We planned to take a break after this, letting the market adjust and giving us time to restock. But the market decided otherwise. The ball kept rolling and the second phase was initiated immediately.
As discussed in another thread the situation where you could get Isogen from NPCs (after a simple refine) kept Iso prices capped when other mineral prices were rising. I would suggest a lot of the jump to 100 was a result of the removal of the NPC Isogen supply and Iso prices catching up.
Originally by: Feronia
After a few weeks we had expected a lot of posts about the Isogen price on the forum, but surprisingly everything stayed quiet. We never understood why people accept such a drastic priceboost when nothing has changed in the availability of isogen. Even worse, they accepted it at a time all other mineral prices were declining.
I canÆt confirm this but I would hypothesis that the increase in Isogen prices actually caused a drop in producer activity, which in turn would cause a drop in mineral demand. If Isogen prices do continue to drop (theyÆve already dropped considerably in Yulai) it will be interesting to see if the other mineral prices increase supporting my hypothesis.
Originally by: Feronia
Magma Industries is proud to announce its first market manipulation project is finished with successà. cut à.. It took nearly a month of preparation, building up stocks and monitoring the market
Assuming your story is true I suspect you made quite a lot of money doing this. I am curious how much capital you needed to execute the strategy though?
Originally by: Feronia
For this the Magma Index was put on hold, because we don't consider it opportune to run them both at the same time.
Two questions here.
1) Do you think this experiment harmed the credibility of Magma and the Index itself? In real life it obviously would (ignoring the fact that you would also be going to jail!)
2) How accurate do you think the Index is/was given that the market data has been wrong since Exodus?
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Kade Shaderow
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Posted - 2005.06.01 20:14:00 -
[3]
Edited by: Kade Shaderow on 01/06/2005 20:14:40
My miner-wallet thanks you.
Quote:
After a few weeks we had expected a lot of posts about the Isogen price on the forum, but surprisingly everything stayed quiet. We never understood why people accept such a drastic priceboost when nothing has changed in the availability of isogen. Even worse, they accepted it at a time all other mineral prices were declining.
...but I think you drastically overestimate the intelligence of the average EVE player.
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Dewar Scrabulous
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Posted - 2005.06.01 21:45:00 -
[4]
Edited by: Dewar Scrabulous on 01/06/2005 21:57:03
Originally by: Feronia
After a few weeks we had expected a lot of posts about the Isogen price on the forum, but surprisingly everything stayed quiet. We never understood why people accept such a drastic priceboost when nothing has changed in the availability of isogen. Even worse, they accepted it at a time all other mineral prices were declining.
I'm not one to winge on about things on the forums. I simply closed my factories and went back to agent running for a while.
-Dewar
PS: I was also keeping quiet and profiting of the increase. Thanks for the advanced notice. I'll clear out my stock.
---
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Feronia
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Posted - 2005.06.01 22:51:00 -
[5]
Originally by: Raaz Satik
As discussed in another thread the situation where you could get Isogen from NPCs (after a simple refine) kept Iso prices capped when other mineral prices were rising. I would suggest a lot of the jump to 100 was a result of the removal of the NPC Isogen supply and Iso prices catching up.
After the iso-reprocessing exploit (btw. which we traced and reported) the market was indeed floaded with cheap isogen. It gave us an unique opportunity to build up a considerable stock. We anticipated on a price recovery, but still had to wait a few months untill we saw the first signs.
Originally by: Raaz Satik
Assuming your story is true I suspect you made quite a lot of money doing this. I am curious how much capital you needed to execute the strategy though?
Most people don't consider a 50% priceboost in 2 months time as a normal market behavior. In the first weeks we had transactions of about 7-8 mill units/day, divided over 10 regions.
Originally by: Raaz Satik
Two questions here.
1) Do you think this experiment harmed the credibility of Magma and the Index itself? In real life it obviously would (ignoring the fact that you would also be going to jail!)
2) How accurate do you think the Index is/was given that the market data has been wrong since Exodus?
1) Not at all, it all took place after the last update of the Magma Index was published. We decided not to run both projects at the same time, to avoid loss of credibility. There isn't a law against buying and selling (not even in RL). This stuff happends daily on the RL stock market.
2) The Magma Index has always been based on the correct data. Its true the market history has been bugged since Exodus release, but we found a way to avoid getting the wrong data (which involved a lot of logging on/off). The last patch resolved the "same data in every region" bug, but created the "No data in the last weeks" bug. I'm afraid we can't give an update without this data, so until this is fixed, the Magma Index is still on hold.
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Dyardawen
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Posted - 2005.06.02 00:33:00 -
[6]
Edited by: Dyardawen on 02/06/2005 00:38:11
Originally by: Feronia
Magma Industries is proud to announce its first market manipulation project is finished with succes.
Hehe, well done. Yet - being a producer - I hate people that do such things, for obvious reasons. And it wasn't difficult to discover that some willful act was behind all these raises in Isogen prices.
Originally by: Feronia
We never understood why people accept such a drastic priceboost when nothing has changed in the availability of isogen. Even worse, they accepted it at a time all other mineral prices were declining.
I didn't accept it. I instead went out into the gallente systems mining omber for my needs of Isogen :-P
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Dreck Morrison
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Posted - 2005.06.02 21:39:00 -
[7]
The isk made on isogen was sweet this time in comparison to the Morphite maniupulations that made me tons of profits. For those I had 500M isk that I turned into 2.5B isk on the first one and on the second one I made 2.5B isk into 4B isk.
My self I had stockpiles of over 10M isogen at the start of this cause all my buy orders got filled with the NPC isogen bug at 66/unit. I recently sold 9M of my isogen at 122 over a weeks time. At first I was ****ed that I got all the isogen dumped on me....now I am glad that NPC manipulation made all that cheap isogen show up!
Still - buying a tech 2 BPO and then waiting 2 months to sell it makes that kind of profits it seems..... |
Raaz Satik
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Posted - 2005.06.03 01:17:00 -
[8]
Originally by: Feronia
There isn't a law against buying and selling (not even in RL). This stuff happends daily on the RL stock market.
There are no rules against buying and selling. There is no rule against buying or selling because you think a price is going up or down. There are rules though that say that buying or selling with the intention of moving a market is an illegal order, at least there are on commodity exchanges (governed by the CFTC).
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Hank
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Posted - 2005.06.03 04:04:00 -
[9]
I don't know much about the EVE universe from a RP standpoint, but what's the major religion? Does it include a hell? If so I'll see you there.
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Allah be praised |
Frost Killer
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Posted - 2005.06.03 04:31:00 -
[10]
Isn't using a bug/exploit for personal gain a bannable offence?? Even if you report it you can't use it to make money/profit off it.
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Ummm ya.... |
Feronia
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Posted - 2005.06.03 07:14:00 -
[11]
Originally by: Frost Killer
Isn't using a bug/exploit for personal gain a bannable offence?? Even if you report it you can't use it to make money/profit off it.
Using a bug/exploit is indeed a bannable offence. But buying minerals on the market isn't. Theres no way you can trace where the minerals you bought come from.
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Wizardo
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Posted - 2005.06.03 07:52:00 -
[12]
You flatter yourself too much. Iso prices were not affected by you in any way, unless you have placed buy orders for 140-150 and made sellers greedy. I know, I mined iso for the past several months and know where to sell, and why. And it's definately not you.
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Feronia
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Posted - 2005.06.03 08:03:00 -
[13]
Originally by: Raaz Satik
There are rules though that say that buying or selling with the intention of moving a market is an illegal order, at least there are on commodity exchanges (governed by the CFTC).
Tell that to the OPEC countrys, I'm paying 40% more for a full tank of petrol, as I did 1 year ago.
Originally by: Hank
I don't know much about the EVE universe from a RP standpoint, but what's the major religion? Does it include a hell? If so I'll see you there.
Don't take this too personal, its only a little market experiment. It gave us some insights in:
- How people respond to a sudden shortage
- How long it takes before the virus spreads to other regions
- How persistent buyers/sellers get when they want to outbid/undercut others
- How people stop looking at the intrinsic value of things, and only look at the price others are paying
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FireFoxx80
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Posted - 2005.06.03 11:18:00 -
[14]
Will the MAGMA index be up and running again then?
ex P-TMC
If you think you can do a better job, go find yourself a datacentre to host a box, get a copy of Visual Studio, and STFU.
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Macdeth
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Posted - 2005.06.03 14:17:00 -
[15]
A few points...
1) Large scale market players tend not to post here much. This is partly because the forum is spammed with annoying price checks, and mostly because knowledge is power. Anyone not dealing in T2 or rare moon mins (unless in 0.0 and backed by large guns) who says precisely what they're doing to make bundles of isk will immediately attract immitators.
2) Much of isogen's early rise could be attributed to the exploit stockpiles finally being drained. With market histories being toast, and even if they weren't, it's hard to calculate mining volumes. In fact I think you're wrong when you assume the supply was constant. Mining scordite was more profitable, not to mention easier, than mining kernite for quite a while there. This potential lack of supply could easily have spiked prices back to 110 or so on its own. Isogen was certainly on track for that in several regions before the exploit.
3) The sustained steep increase in prices obviously garnered speculators outside of your own group, which further accelerated things. I suspect many are still active. Yulai's bid-ask spreads are a goldmine for daytraders even when prices are stable.
4) Large consumers of isogen who lack stockpiles worth many many billions have little choice but to pay the higher prices. The choice is "make no profit", or "make 5% less profit". The falling prices of the other minerals actually enabled people to bid significantly higher on isogen than they otherwise might have while holding the prices of finished goods steady.
5) Psychology on the 0.01 isk over/underbidding can easily be observed in Yulai, any day of the week. Eventually someone will place a large order at a substantially better price, in hopes that their competition will let it go. Some will, some won't, and this price quickly becomes the temporary price point until someone else wants the transaction more badly and offers an even better one.
6) It's actually quite simple to influence mineral prices this way. I helped significantly raise pyerite prices in southern Empire for several months earlier this year, before the combination of more miners than buyers eventually tied up all my capital in pyerite. I obviously lost control of prices then, since my own buy orders were the base which propped them up. Quite amazing what a large crew of probable macro miners (they were on 16h+ per day for weeks) can do when they try.
7) I dismiss the idea that anything in an online game's economy has any particular intrinsic value. At a moment's notice, the developers can make an item hundreds of times more common or more rare. Even if they couldn't/didn't, the money supply grows by at least tens of billions of isk per day. I would love to see detailed numbers for money supply in an online game...
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Raaz Satik
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Posted - 2005.06.04 13:30:00 -
[16]
Edited by: Raaz Satik on 04/06/2005 13:32:15
Originally by: Feronia
Tell that to the OPEC countrys, I'm paying 40% more for a full tank of petrol, as I did 1 year ago.
Middle East 'troubles' means supply constraints, well at least it reduces their ability to react to demand increases. Chinese Growth seriously imbalanced the supply/demand balance at a time when the world couldn't react to it. Throw in a vibrant commodities market and many eager speculators (including many large hedge funds coming of sub-standard years - see MacDeth's 3rd point) and you get an explosion in oil prices which when inflation adjusted still mean that oil is one of the cheapest commodities in the world.
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loladoll
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Posted - 2005.06.04 22:08:00 -
[17]
very well done, thanks for coming clean 
More details would be appreciated : like how much isk do you need to do this?
______________________________________
live is tough and then you get a clone |
Kade Shaderow
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Posted - 2005.06.06 03:15:00 -
[18]
Originally by: Gavin Kineli
Oh yeah, and good job trying to be a jackass and raise prices.
OMG HOW DARE THEY TRY AND MAKE MONEY. EXPLOIT!!!!111111111
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Gavin Kineli
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Posted - 2005.06.06 04:45:00 -
[19]
Edited by: Gavin Kineli on 06/06/2005 04:45:26
I didn't go and yell exploit :)
I just meant that it's not a nice way of making money.
Play The BIG Lottery! |
Vistilantus
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Posted - 2005.06.06 12:52:00 -
[20]
Originally by: Gavin Kineli
Edited by: Gavin Kineli on 06/06/20 |
Gavin Kineli
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Posted - 2005.06.07 04:15:00 -
[21]
I'd agree, except nobody is really making any isk in this situation. It's just making isk move faster (inflation).
People who mine make more isk, so people who buy mins charge more, and the people with that isk then pay more, so you didn't actually |
Raaz Satik
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Posted - 2005.06.07 11:28:00 -
[22]
In theory yes, but you would be surprised how the prices of many items do NOT move dynamically along with the mineral markets. With the big run up in Iso it was possible to buy and scrap refine many Iso-heavy modules for good margins.
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Kallanthre
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Posted - 2005.06.07 21:56:00 -
[23]
Exploit? not in an illegal sence. Sure the 'real' world can be exploited, so why can't EVE act in a similar fashion? I personally see the theoretical side of this and has is a great study/experiment on just marketing. Not to mention benefits to those seeing the market increase in price, it shifts attention of how the economy works. Those who were intelligent to see these changes, knew what to do.
Good Job,
Even though some may be a little upset at the fact that prices increase, its just money.
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Feta Solamnia
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Posted - 2005.06.08 09:48:00 -
[24]
Great stuff there feronia.
That was one damn huge experiment.
What isogen bug? I know I'm closed in my own little world of comps, but missing on such a thing puts me to shame 
Btw, did you offload all the iso already or is it still there in your holds?
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Feronia
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Posted - 2005.06.08 15:14:00 -
[25]
Despite what many people think, you don't need a huge pile of Isk. If you dedicate your time to it and find a balance between the incoming/outgoing amounts, the money invested can be limited. But don't underestimate the work and risk involved.
All our iso is sold, Feta. We stopped a few weeks ago. Looking at the markets, I guess others are still trying to keep the ball rolling 
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Ray McCormack
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Posted - 2005.06.09 06:36:00 -
[26]
How many (exact) weeks ago did your little project finish?
| The BIG Lottery | BIG Sales | 916433 | |
Delfina
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Posted - 2005.06.09 15:58:00 -
[27]
hmm, what if CCP implemented a market freeze on base mineral prices... 1, 4, 16, 256, 1024, 4096.... hmmm, what if?
pish off the market games & manipulating prices. It's just new fleas on a different dog to 1bil sell order exploits and 0.01 isk buy orders. :P "proud to announce"... pride goeth before the fall.
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Better, stronger, & smarter than you! Who cares about good looks :P |
Neurotic Cat
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Posted - 2005.06.10 21:39:00 -
[28]
OMG! Market manipulation and economics experiments 4tw!!!!
Feronia - When you get tired of these boring Magma people please stop by and talk. Sharks with Frickin Laser Beams may have an opening for you.
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Sadist
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Posted - 2005.06.11 06:28:00 -
[29]
This is so tempting to try .
I have never liked the prices on Nocx...
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Originally by: Dark Shikari
"One Trit to rule them all, One Trit to find them, One Trit to bring them all, and in the veldspar bind them"
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Gerome Doutrande
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Posted - 2005.06.14 13:10:00 -
[30]
impressive and well done, it is good to see how many different ways are there to play this game.
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