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Thread: But how can you know the value?

  1. #1
    Recruit
    Join Date
    Jun 2014
    Posts
    43
    World
    Ares

    But how can you know the value?

    This is my favorite question to address.

    I have spent the last year investigating this question.
    While giving answer to it.
    While learning more about it.. What a trip.

    I have read some forum posts that have address the topic. With some. Less than accurate information.

    Let's start with this. Separate into 2 questions with a separate focus.
    What is the value of an item?
    What is said item worth?

    This is where I see conflation.

    These questions actually speak to.
    What is the intrinsic value?
    vs.
    What is the market value?

    Intrinsic value refers to the subjective evaluation of an item.
    Market value refers to how much somebody will pay for it.

    Intrinsic value is subject to factors such as economic profitability.
    A plot of farmland may cost $20,000 annually to operate, but produce $100,000 annually.
    The intrinsic value of this farm plot is $80,000 annually.
    The market value of this plot of land is subject to various factors.
    Demand, competitive buyers, any number of things.
    A person who knowingly will invest 5 years of ownership will happily pay $200,000 for this plot of land.

    Let's have a peek at a brand new item for simplicity.
    Heart balloon.
    Target rabbit breeder for 4 hours with +%500 strength.
    This results in approx. 1300 additional bean production after duration.
    Where beans are valued at 1:3 to coin.
    This means the heart balloon buff has a production value of 3900 coin per use.
    To an unaware buyer, you would be able to sale this item for 4000 or more coins per buff opposed to using it yourself.
    Where a 6000 coin sale would result in 150% profitability.
    This would be a way of exploiting Market value over intrinsic value.
    If the item were tradeable.

    Let's compare 2 items.
    Stadium snack and Rainbow snow.
    Equal strength buff. Snow has X4 duration.
    given that.
    Value of RS = 4SS
    if RS = 4000
    4000 = 4SS
    4000/4 = SS
    1000 = SS

    This is how to determine comparative market value of two similar items.
    How can we exploit this?
    If.
    4SS = 1 RS value
    We can mask our purchase price in a larger lot size to indirectly acquire our target commodity.
    If we were to purchase SS @ 500.
    We would be able to acquire 4 SS @ 2000 invested total.
    Using the power and time equivalence of the item.
    We can direct trade 4 SS to 1 RS.
    Being able to sale 1 RS @ 4000 market value.
    Covering investment with net gains of 2000 coin, where 2000 coins were invested.
    This trade route is exact +100% profitability over investment.
    To mask our offer here is what is done.

    We want to "buy low" targeting RS. So that we may sell high.
    Knowing we can trade 4:1 to achieve 1:1 value.
    We want to obtain at a price where equivalency results in 1:2 output.
    To do so.
    Purchase 100 SS @ 50,000.
    Players see a large coin offer for an item they do not use. Buy it.
    Now you may trade 100 SS to 25 RS equivalant.
    Sale 1 RS @ 4,000 results in 100,000 coin value for 50,000 net. = 200% invested value.

    This is how you can trade using stock market strategies comparing market value to market value using intrinsic value as the backbone of the trade.

    Now. This is where things get a little more tricky.
    You can trade a 3 items route.
    Where A = coin ( a standard)
    B = commodity
    C= commodity

    We may pose that where B > A, and C > B, all C > A
    Inversely.
    If.
    C > B and B > A then A > C

    That's got to mean something right?
    We can use that information somehow?
    Similar to the above exploit where we mask intended purchase price.
    Here we have another opportunity.
    What we want to do, is obtain B below market value. Trade to C at 1=<1) intrinsic value.
    so that C may be cashed out to A.
    Where C > invested on B.

    Huh?
    Yeah.



    Purchase. Imp silo -275,000.
    Trade imp silo to 550 eggs.

    to sale 50 eggs @ 40,000 results in.
    1 egg for 800c.
    Meaning. To even out -275,000.
    We divide.
    275000/800 = 343.75
    Where.
    To sale => 343 eggs. would result in $0 cost with net 500-344 = 157 egg net.

    This 3 item trade puts 157 eggs in your pocket. You do not gain or lose any coin.
    If all eggs sold.
    500*800=400000-275000=125000/275000=.45~=145% profit rating.

    Compare to.
    Acquire improved farm for 90kc.
    Trade farm to 150 egg.
    While egg = 1:1000
    150*1000 = 150,000-90,000=60,000 =.4= 140% profit rating

    To tweak.
    - acquisition price.
    + ratio on B to C trade

    With 85k to farm.
    farm to 165.
    Formula results in.
    145% profitability.

    First example shown is where egg value = 1:800.
    What would the result be if value = 1:1000?

    Well. Thankfully I have designed a super complex excel sheet which calculates all this for you.
    You are able to use the above techniques to set a trade route ahead of time and determine the profit rating.
    140%. I call it what it is.
    1:4 output to investment.
    145%
    1:1.45 output to investment.

    What excites me, are the trade routes I repeatedly utilize to produce a 2.3 profit rating.

    During your typical, Halloween, valentines, whatever typical event where event resource is tradeable.
    I am on top of it.
    My average daily egg production camps around 8000. On stronger event day's I can push 12000.
    On a slow non event day. I profit $200000 coins.
    On a typical event day.
    I am engaged in 3 million in coin commerce daily.
    In and out, moving items. Buying the to trade for that, to trade for this, sell to that.
    All sorts of magic that I don't even understand. (joking)
    I will hard profit coins. And spend the coins.
    This results in enough Net event gain as result of the process to where I can buy out the event shop.
    And I always do, while being able to still giveaway 20 000 eggs to low level players.


    There is a list of micro factors which affect the many moving pieces of this machine.
    But if you understand the trends, competition pricing, buy outs, shorting, speculation.
    You can make predictions and moves that will stand out from the others, while hiding your intent.
    Takes some practice and experience. But it's there.
    Learn to trade. It will help you.

    I am just going over the tip of the iceberg here. I have written on the topic time and again and have many guides written covering trade strategy.

    What happens.. when the egg price drops to 1:400, surely these routes no longer work?
    No. they do not. Well. They do. But you have to invert and sidestep to adjust the strategy.
    With a slight tweak.
    You can go from buying in B to C to A to B.
    Transition to buying in A to C to B to A.
    And it works.
    So no matter what the market prices are of absolutely anything.
    You set the value of items. By determining an approximation of market values and employing a masked acquisition. You are able to sell for more than you spend always.
    With proper use of my calculator and understanding the directional use of my formula.
    Anybody can learn how to make profit out of thin air.

    Say hi in game with your questions. Good luck.

  2. #2
    Settler
    Join Date
    Sep 2012
    Posts
    123
    World
    Ares
    Wow you sure wasted a lot of effort! Answer is simple as can be = whatever someone will pay for an item. Thats what its worth. Especially in a game where resources easy to get.

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