Players can make money in the GE through several methods.聽
- “Investing”: This involves predicting an item’s long-term price trend and then acting upon it. A聽player will buy as much as possible of an item when he/she thinks it is at a low point and sell it when he/she thinks it has reached a high point. To make money with this method, players must accurately make a prediction as to how a future/current game update or other in-game event will affect item prices in the future.
- “Flipping“: This involves buying items with the intention of selling them at a slightly higher price in the short term, often as soon as the 4-hour timer has expired. This method is a kind of time-based arbitrage: players act as an intermediary between buyers in one time period who want to immediately buy an item and sellers in another time period who want to immediately sell this item. This method is most effective when there are fewer general users in the GE鈥攚hen the difference in time between the buyer’s order and seller’s order is greatest.
- Price Manipulation: This method, though it is done in various ways, is essentially a manipulation of how the GE聽works. A聽price manipulator (or price manipulation clan) will buy items in very large quantities in order to drive up the price. Later, the player or players will then sell (dump) the items on the GE after the item has reached a price much higher than what they paid for it, causing the price to fall dramatically. Players who bought when the item was at a relatively high price and did not sell before the crash lose enormous sums of money, while those who knew or were lucky enough to know when the price crashes gain enormous amounts of money. This method tends to be more effective for items that do not have a very large market on the GE (it’s easier to buy out that item): yew logs for example, have a gigantic market on the ge, but tomatoes do not.
- GE to “real price” arbitrage: All items on the GE聽have price floors and ceilings.聽The price cannot go higher than the “ceiling price” set by Jagex, and it cannot go lower than the “floor price” also set by Jagex. For some items, the real demand outstrips a low price set by Jagex and thus players are unwilling to sell the item at the low price, which is the “ceiling price” set by Jagex鈥攖he price of the item cannot go higher. For other items, the supply is so great that no one is willing to buy at a fixed high price or the “floor price” set by Jagex鈥攖he price cannot go lower.聽Players can go around these restrictions in a variety of ways, such as trading some artificially low-priced items for other similarly low-priced items. The most common way of making money in this category is to sell items (those that are fixed to the store price on the GE), such as Dragon Scimitars, for over the GE value (both the GE聽and store price is fixed at ~100K, while players often pay 110 to 125K) using players’ trade difference limits.
- Item Conversion: This category involves actually changing the items after buying them in some minor way- for example, making sets from pieces of armour, or potion decanting. This is not pure arbitrage, as time is spent processing the item. However, it meets the definition of arbitrage.
When choosing an item to merch: pick an item that has unstable price (which goes up and down) for faster selling. (ex. Most of the ore in GE [Adamantite, Gold, Iron, Mithril] have unstable prices)
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Tags: Arbitrage, Ceilings, Difference In Time, Enormous Sums, Game Event, game update, Gigantic Market, High Point, Intention, Logs, Manipulator, Price Floors, Price Manipulation, Price Trend, Quantities, Sums Of Money, Time Period, Timer, Tomatoes, Yew
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