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Newbros: Market Vision

January 15, 2015

Trading, along with spying, is one of those professions that nobody talks about, and beware if they do.  That “hot tip” on what to buy can cost you dearly. These two “meta-professions” depend on information as power; as what you know is just as important as what you deprive others from knowing. When it comes to market trading, most players never develop a sense for market vision and only use it as a shopping mall or consignment shop.

Market Strategy

The natural pursuit of a trader is to keep costs down. To this end, some traders become their own suppliers (industrialist), some go even deeper, and become their own resource harvester: Mining, salvaging and exploring for raw materials.

Buy Low

To buy low, you have to get into the mind of the suppliers (sellers), and think like they do. Figure out what influences the price they are comfortable letting something go; production costs, competition, expectations.

Production costs – suppliers won’t willingly lose money: know their build cost (their bottom line) and price your buy order just above or below, depending on other factors (competition, expectations).

When buying loot, buy at 60%< than regional average. If suppliers don’t like (buy order) prices they will hold or try to sell it themselves (sell orders). The red negative indicator is an alert. If you are really wanting an item, pay at or above regional rate so they see positive green indicator when they sell. Green encourages instant sales to your buy orders.

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Competition – The supplier’s pressure to sell lower is greater in trade hubs.  The bigger the hub the lower the prices, the faster items move. Suppliers want to find buyers so they can makes sales quickly so they are pressured to go to big trade hubs and sell lower.  The only place with lower is at the supply source: To do research, go to Dotlan.com, select a region and use the filter drop-down on the above right area of the map (see image below).

Minerals – to buy minerals, go to mining fields and place buy orders there.  The miners will refine and sell without having to haul minerals to the market. Save them time and they will discount the ore. Find mining areas filtering: Belts. Belts with Ice and groups of systems with lots of belts will have miners. Check station’s buy orders to see what the buyer competition is like, and note the volume of sales to see if it is active.

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Loot and Salvage – to buy this, you need to head to NPC mission areas and ratting areas.  Don’t bother with incursions areas because those pilots don’t bother picking up loot or salvage.  They are in it for the Bounty ISK. Filter NPC kills, check agents in stations. Level 4 agents are big money and attract pilots. You can filter NPC Kills Delta, to see what time of day areas are active with pilots.

Moon, T3 Goods – Jita.  Null-sec and w-space alliances have no incentive to sell anywhere else. Prices are always lowest for these items at Jita. Since these items are building materials, they effect your bottom line.

Planet Mining – These are sold everywhere but you can place buy orders where favorable planets are by using the filter by planets types.  Note that most harvesters fly to different systems to get materials so hauling them to a big trade hub is not a deterrent.  Usually these are 2nd income and most players want to sell fast for the ISK, again at fast selling large trade hubs.

Expectations – If suppliers expect prices to go up, they hoard. If they expect prices to go down, they fire-sell. Be aware of game changes, and sov changes. Read about deployments for big alliances and learn what they fly – stock their lowsec staging systems. Find those by locating low/high sec border systems and check info on local pilots.  Keep in mind nullsec alliances have cyno-alt corps so learn who they are: See evewho.com for large corps list, most of those are cyno corps.

Sell High

On the other side of the equation, as a trade seller (supplier), you want to sell items in the most favorable conditions so you can ask for more ISK from the buyers. To find those conditions you need to know what influences demand:

Population – Know the types of players you want to sell to and where are they located. Miners live near belts or factories. Faction warriors live in certain low sec hubs. null sec alliances have capital and subcapital stations that won’t be accessible to outsiders.

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Income – Industrialists and mission runners pay well because they see everything as an investment. PVPers are usually more cost conscious since they die more often. New players are broke and very cost conscious. Veteran payers are rich (or should be) and will pay more for time savings. They understand time is more important than ISK.

Preference – Preference is the hardest to account for. What customers want depends on a combination of many factors; location, activities, game changes, alliance doctrine changes, etc. You cannot expect to know what pilot preferences are in the abstract, but you can see what they are buying and at what rate they are buying it at.

There are some generalities that you will know as you get more game experience, here is an example:

  • Selling a shuttle in a trade hub is a bad idea. Too much competition.
  • Selling a shuttle in low sec space is a good idea. You can get more because pods need a safe and fast way to get back to their hangars. Shuttles are fast aligners and warpers.
  • Selling a shuttle in null-sec is a bad idea, because bubbles trap shuttles at gates. No one will buy them. Sell interceptors instead, because those are immune to bubbles.

Connections

Economic connections are everywhere. Some are basic and easy to see, others are more complex as the degree of separation increases from the original item.

Some basic connections:

  • Basic ships and modules are made of ore (ship mining).
  • Advanced (Tech 2) ships and modules are made from ore and moon materials (moon mining).
  • Navy ships and modules are made of ore and faction loyalty points (missions, faction war)
  • Structures are made from planet materials (planet mining)
  • Drugs are made from gases (ship mining)
  • Fuels are made from ice (ship mining)
  • Rigs are from salvage (missions, ratting, pvp)

The very basic connections: When ships are blowing up in large amounts, demand for ore goes up. If miners and builders are active, ship prices go down. When war breaks-out, fuel and structures see increased demand, prices increase. An example of complex connections: CCP nerfs the Ballistic Control System, aka missile weapon upgrade line of modules:

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So a change from CCP to missile weapon upgrades rippled down to planetary interaction (PI) components, like Plasmoids. The inverse is happening as well because as missile weapon upgrades lose value, competing products surged. What did missile ships effectively counter, and are those now viable again? You will know the answers to these questions as you learn fleet doctrines and war tactics.

These connections can get very complex, with many connections influencing an item’s price.  [Nocxium, Jesters Trek Article] walks you through a very complex set of connections relating to how Noxcium prices went up after CCP altered loot drops in the Drone regions.

Prospectors

Regrettably, CCP unceremoniously stopped publishing their economic quarterly reports (aka QEN) [2007-2010 reports]. These reports, along with CSM reports, and dev blogs, were goldmines for those willing to understand their effects on the markets. To this day, competitive players rapidly read through the CCP publications, make analysis, and prospect on the changes announced.

Beware, obvious prospecting opportunities are obvious and spike, sometimes over-spike, quickly. If traders expect shortages they will hoard and try to make a profit after the changes hit, so there is often no change in prices for weeks after a change. Also CCP announces changes, but those are not assured and may change like they did for Freighter Rigs.

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Sage advice is to spread risk by diversifying, but always know what you are invested in. If you don’t know how loyalty points work, you won’t know when to get in our out so don’t invest.

For great stock tips and trend explanations, tune in to EVE-Prosper Market Show, live: Friday 0300 http://twitch.tv/hlibindustry

Transporting Goods

You have probably heard this advice before, but it bears mentioning. Market advice over the years has been to buy at a hub, haul to a smaller hub and mark it up. This puts you at risk while your supplies are in route. Here’s ways to minimize that risk:

Avoid auto-piloting through low security space or high security bottlenecks like Uedama, Niarja, Sivala, Jita. Even the systems before and after are worth personally piloting through. Auto-piloting through high-sec space is usually safe, and you can do it while you step way from the computer.

Do not overload the value of your cargo or you will become a target.  Generally, carry 800 million to 1.2 billion in a freighter and a lot less in industrial (100 million or less). Gankers want to profit so if their suicide ships cost as much as your cargo, it’s a wash and not worth the effort. The worst way to move high value goods is through a small ship that can be easily killed by one volley from an attacker.

Freighters can now use reinforced bulkheads, so put those on if you are auto-piloting, it makes you harder to kill.

Blockade runners (T2 industrial ships) cannot be scanned so assume they will be targeted by gankers.  Do not auto pilot these, ever.

 

Trading can be rewarding if done right. Someday CCP might revive tools like corporate stocks and shares, and the players may re-light the flame of inter-corporation investments in the form of banks and loans. Unfortunately it is too easy to walk away with someone else’s hard work in EVE, and players cannot discern between the deliciously intricate heists and the shameful, inside job, smash-and-grab burglaries. They are both celebrated equally, but shouldn’t be. In a game that insists on advising new players to “find a corp fast,” and “trust no one,” you can imagine how confusing the social landscape is.  That’s the next article: The meta economic game.

Until CCP makes mechanics that keep crimes that cannot be punished in game at bay, stick with trading.  That’s the only real economic game there is for financed minded players.

Trade safe o7

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