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The Best Part of Grand Theft Auto V is the Stock-Trading Platform

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Re: The Best Part of Grand Theft Auto V is the Stock-Trading Platform

#61

Post by mathattack »

minimax wrote: post #49
mathattack wrote: post #26

Earlier quoted context omitted.

Let's oversimplify for the sake of showing the calculation... There are 4 stocks in the world, A, B, and C, and D, all trading at $25. I invest $100, buying $25 in each. Now lets say that I know for sure that stock D will go down because I'm going to whack the CEO. So I sell my $25 of D, and put it in A, B and C (A stake of $33.33 in each - let's assume fractional shares are ok.) If Stock D goes to 0, while the other…

All of your profit in this scenario comes from the market going up, not D going down. That's not a short (or synthetic short) position.

The math still holds if you assume buying back after the drop.

Think of it this way - in both cases you're selling today, and buying later. The only difference is the "hold the whole market first" strategy requires more capital. (There are market technical differences too, but for short time periods these aren't as significant)

Re: The Best Part of Grand Theft Auto V is the Stock-Trading Platform

#62

Post by erdle »

jredwards wrote: post #11

Incidentally, there are already a multitude of subreddits which have formed for the express purpose of manipulating the public markets. This is a really interesting interaction, though it's somewhat skewed by the fact that a player can simply revert to a saved game if the stock they've purchased tanks.

Fairly certain he's basing this article on the top /r/gaming post the other day about trading. He only mentions hours passing between trades.

Also, I know writers at NY Mag and others that have literally said to me "I don't know why you go on Reddit, I get paid to find stories on there and I still hate using it." HuffPo and everyone else literally just sits on the site waiting to take content.

Re: The Best Part of Grand Theft Auto V is the Stock-Trading Platform

#63

Post by mcdougle »

roc wrote: post #44
aninhumer wrote: post #41

Earlier quoted context omitted.

Insurance is the opposite of gambling. You take a guaranteed loss instead of risking a huge one. Not having insurance is a bet that nothing bad will happen. If you can afford to replace everything you own out of savings, good for you, but most people can't.

Beyond that, given the perverse 'market' for health care in the US, even if you can (theoretically) afford to self-insure, the pricing mechanisms and negotiating power of insurance companies practically ensures that they can offer you premiums for less than your out-of-pocket cost for even fairly pedestrian services.

There are (or at least were when I sold insurance) products that costed very little (compared to an actual plan) that provided you with the negotiated price the insurance company would pay if something happens. If you can afford to self-insure, the best bet would be to buy one of these products and store the rest in the bank.

No clue if those things exist anymore with everything going on in the world of health insurance, though.

Re: The Best Part of Grand Theft Auto V is the Stock-Trading Platform

#64

Post by StavrosK »

nslocum wrote: post #14

The BAWSAQ is by far the most interesting market. The BAWSAQ is an online market driven by the buy and sell orders of all 15M+ players. Early on, before people started to realize how the market worked, I did some pump-and-dump schemes and made >$400M. That's a lot of money, even in GTA. Now that I have that much money I can drive stocks up or down and milk the market for all I want. GTA isn't just for blue color crim…

What are "pump and dump" schemes?

EDIT: Oh wow, Wikipedia has everything: http://en.wikipedia.org/wiki/Pump_and_dump

Re: The Best Part of Grand Theft Auto V is the Stock-Trading Platform

#65

Post by brads84 »

a-priori wrote: post #39
nlh wrote: post #13

I...bought...twenty shares of Augury Insurance (which sells auto insurance — a good bet, considering all the cars I've been wrecking) I'd argue the opposite, no? The 100-year-storm of destruction that we, as Player 1, unleash upon the poor Liberty City automotive world would probably make any insurance company run screaming and crying in the opposite direction of profitability. "We had HOW MANY claims yesterday after…

It doesn't matter to an insurance company how likely car crashes are -- that just determines what the company charges in premiums. All that matters is that the likelihood is well understood and that the company has enough customers to stay solvent. Insurance companies essentially work by the Law of Large Numbers: that in a large enough number of trials, the average value should approach the expected value. In real wo…

Insurance makes money on float and usually loses money on insuring something over the long term. I can't remember the exact numbers, but GEICO might payout something like 103% (or 3% MORE than you paid them) over the term of your policy with them.

How do they make money? http://seekingalpha.com/article/419731-buffett-on-insurance-...

Basically they invest your premiums during the time you are paying them and make money off of holding your money. Then the other insurance agencies might lower their costs and end of paying out 104% (or whatever) of what you've paid in. This competition pressures the market to close the gap between what you can make on the float and what you can charge your customer, but there is going to be some gap and that is the profit margin.

If the insurance company can make a high ROI on the float, they can charge less in insurance rates and still make money.

Re: The Best Part of Grand Theft Auto V is the Stock-Trading Platform

#66

Post by invalidOrTaken »

One game that, like GTA, is not focused around making tons of virtual money, but has some neat emergent lessons, is Escape Velocity Nova: http://www.ambrosiasw.com/games/evn/

You have a small starfreighter, and one way to make money is by buying goods where they're inexpensive, loading them up in your cargo hold, and flying somewhere where they're expensive to sell them.

Eventually you realize that it makes sense to pay other freighters to help you carry stuff so you can make more per trip---but since they charge a daily rate, at what point is it worth it? And does it make sense to risk it all ('cause, you know, space pirates) putting your life savings into a load of expensive opals which will make you a ton once you arrive, or should you play it safe and stick to inexpensive but barely-profitable foodstuffs? If you've got an appetite for risk, you can carry drugs or illegal biological weapons, both of which will make you a ton of money, but will cause law enforcement to attack if you're scanned.

It's a sort of mini-version of EVE this way, in that it's the only game I've made a spreadsheet for.

Re: The Best Part of Grand Theft Auto V is the Stock-Trading Platform

#67

Post by nslocum »

StavrosK wrote: post #64
nslocum wrote: post #14

The BAWSAQ is by far the most interesting market. The BAWSAQ is an online market driven by the buy and sell orders of all 15M+ players. Early on, before people started to realize how the market worked, I did some pump-and-dump schemes and made >$400M. That's a lot of money, even in GTA. Now that I have that much money I can drive stocks up or down and milk the market for all I want. GTA isn't just for blue color crim…

What are "pump and dump" schemes? EDIT: Oh wow, Wikipedia has everything: http://en.wikipedia.org/wiki/Pump_and_dump

With the BAWSAQ it's even easier than traditional pump-and-dump. If you pour a large enough pile of dough into a stock, it goes up a ton after a delay (1-2h). So, you can purchase all you want before the price skyrockets. Other players predictably pile on because they see the stock going up; which makes the stock go higher and entices even more players to invest in the stock.

You then sell all your stock for a tidy profit and watch the price, and the hopes of the other investors, collapse.

Re: The Best Part of Grand Theft Auto V is the Stock-Trading Platform

#68

Post by hrkristian »

jlgreco wrote: post #55
a-priori wrote: post #52

Earlier quoted context omitted.

Insurance is accepting a small but certain loss to prevent a large and unlikely loss . Gambling is accepting a small but certain loss in the hopes of getting a large and unlikely gain . They're related but opposite concepts.

The Casino , not the gambler, counts on a constant stream of money coming in with the occasional large chunk of money going out. Insurance companies operate the same.

What you're both describing is socialism, insurance is opt-in socialism, pure and simple.

Re: The Best Part of Grand Theft Auto V is the Stock-Trading Platform

#69

Post by minimax »

mathattack wrote: post #61
minimax wrote: post #49

Earlier quoted context omitted.

All of your profit in this scenario comes from the market going up, not D going down. That's not a short (or synthetic short) position.

The math still holds if you assume buying back after the drop. Think of it this way - in both cases you're selling today, and buying later. The only difference is the "hold the whole market first" strategy requires more capital. (There are market technical differences too, but for short time periods these aren't as significant)

The only difference is the "hold the whole market first" strategy requires more capital.

That's not the only difference. It's not even the biggest difference. The major difference is that in your scenario you have a big unhedged exposure to the market (your p&l depends on the performance of A,B,C) and in the case of just shorting D you don't (doesn't matter what happens to A,B,C). That's a pretty big difference.

Re: The Best Part of Grand Theft Auto V is the Stock-Trading Platform

#70

Post by jlgreco »

hrkristian wrote: post #68
jlgreco wrote: post #55

Earlier quoted context omitted.

The Casino , not the gambler, counts on a constant stream of money coming in with the occasional large chunk of money going out. Insurance companies operate the same.

What you're both describing is socialism, insurance is opt-in socialism, pure and simple.

Uh... okay. If you want to call it that, that is fine. Not sure how that is relevant though.
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