Sunday 1 February 2015

The PLEX Experiment - Ramping Up Volume

This is an update on how The PLEX Experiment - Buying and Selling PLEX for Profit is coming along.

I've been slowly increasing my presence in the PLEX market, testing theories and trying different things to see how the market and the competition reacts.

This weekend I got extremely aggressive in the PLEX market, increasing both the prices I was paying and how many I was buying in each of 22 different regions. I wanted to buy and sell a lot more PLEX than I usually do and see what kind of effect greatly increasing my sales volume would have on profits.

It worked very well on the buying side. On Friday I bought 63 PLEX, on Saturday I bought another 108 for a total of 171 in 48 hours. It looks like I probably can buy 100 a day, at least on the weekends.

Unfortunately sales weren't nearly as good, I only sold 17 on Friday and 18 on Saturday for 35 in total. Once I started selling more than 1 or 2 PLEX at a time anywhere the no-lifers and bots quickly came out of the woodwork and began undercutting me constantly.

It didn't take long before sell prices were down into the low 800 millions in most places and even under 800 million in some places (Jita for one).

Of course if I can't resell PLEX at a profit quickly enough, I won't be able to buy 100 a day for very long before I'm out of cash and sitting on stacks of PLEX. Many competitors will happily sell PLEX for 12 million markup and some even less. It looks like the key to doing any real volume (selling more than a few PLEX a day in any one region) is going to be grinding faction and corporation standing even more to lower broker fees even further.

Unless of course those competitors are bluffing and can't keep up the undercutting game for much longer. In that case I should be able to sell all or most of my PLEX during the next week and buy more the following weekend.

Strangely enough, one place were my PLEX sales did do very well this weekend (much better than usual) was Genesis. For some reason the Malma bot backed off on PLEX this weekend, but not on other things.

I've noticed several patterns in PLEX sales, some seem to be natural and others manipulative. The main thing is there's a weekly cycle (often hidden by manipulation) where prices go down on the weekend and back up during the week.

Though I can't prove it, I'm quite sure this is due to more PLEX being purchased for real money on the weekends and sold quickly for ISK which tends to bring prices down. Then during the week, fewer new PLEX enter the market, prices tend to go back up and many of the PLEX purchased on the weekend are resold for profit.

It's also interesting how shortly after I ramped up my business and grabbed more market share prices dropped significantly. That's not the first time that's happened either. It happens every time I try to sell more than 1 or 2 PLEX in the same region, prices go down and undercuts become far more frequent. To me that's a strong indication bots are very active in the PLEX market.

Then again, considering how much prices have dropped over the last 2 days and how the blocking orders have disappeared again, it's possible the market might be starting to crash. In that case I picked a very bad time to increase my volume and could wind up losing some billions or even 10s of billions.


  1. Hubertus Halbfas1 February 2015 at 03:25

    Not sure what you mean with falling prices. PLEX is rising again steadily :(

  2. The Jita price has regained about 13 mil since I wrote that last night when it was under 796 mil in sell orders on Jita but you can easily see the drop over Fri/Sat by looking at the history graph.

  3. "The main thing is there's a weekly cycle (often hidden by manipulation) where prices go down on the weekend and back up during the week."

    This is not just with PLEX, its with all goods, in weekend all kind of people put up orders, if you want to speculate away from that, you need to go in big time. If you realize that the big isk is not in the short term, but in the long term, you know you can let the market eat itself over the weekend. So, volume is brought into the hubs by people working production during week days. First people will then dump on high priced buys. When those are gone, people will start selling around to between the old low and the old buy. People will 0.01 isk each other down a lot. After the weekend however, this will stop. So, then you can restore order, while you know the costs will have a recover time of 4 days. If you have enough turnover on the location you reorder, you make it back. If you speculate above the equilibrium and you know your market, you can add a markup and you will have 2 days to work back up and 2 days of profit. Now imagine doing this over your 22 traders. See the pattern?

    This is why prices will go up again. Speculators move in big time, after the new equilibrium has been presented. They know there market and will choose to buy out, stock, relist, sell, etc. Prices will go up and the cycle will start again nxt weekend. After the end of Skill Queue online I expect this pattern to be more apparent in high volume markets.

  4. I agree with all of that.

    The only problem is until you have enough cash you can afford to just sit on stock for a week or more, it's more profitable to just sell quick at lower profit margins and reinvest.

    For me, with so many traders it took a lot of ISK to get to that point. I have been there for a while now, slowly experimenting with, identifying long term patterns and converting over to longer term trading.

    Sometimes it's hard to break old habits you've become comfortable with and that's a big part of why I made such a big push into PLEX this weekend. A lot of that was about getting out of my comfort zone, taking more risk and finding out if I'm big enough to start playing with the big boys yet.

    So far it's looking like the answer is yes... As long as I stop dealing in over 300 different items and whittle the list down to something more manageable.

    Lately I've been taking more of a targeted approach rather than a blanket approach. I'm concentrating more on high volume and high margin items while letting most of my "passive" buy orders expire and reinvesting most of the ISK into high volume items like PLEX.

  5. Due to RL issues, I have chosen to go the other way around. Pick a few items and grow into those markets completely, then branch out over time. Atm I am sitting on 24 products, with a 100 isk each top price. They just evened out last month and another project is waiting, when that is done, a new 8 product branching will be considered. PLEX is not and will not come into focus for a long time. Rather I would go the other way, into minerals, its just a much higher competitive market, thats why I didn't go there yet.

  6. I think there is a 10% discount on PLEX as well. They had that sale around Christmas time, and it went away. I saw the advertisement again. I have also noticed that on the weekends the prices drop and I'd like to say you're right in thinking that it's just more people getting on and buying more PLEX from CCP to sell on the quick. I'm hoping the market doesn't crash too much.