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Ricky Zamboni
Private citizen
Join date: 4 Jun 2004
Posts: 1,080
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05-25-2006 14:04
I think Kelly Linden misunderstood Kazanture's question. Perhaps this will help: With buy/sell prices of L$341/320: (a) I place a buy order for L$350,000 at L$340/USD. This is the first to be sold to. (b) My buy order is filled, costing me $1029.71. (c) I post a sell order for L$350,000 at L$321/USD so it's the first to sell. (d) My sell order is filled, netting me $1052.18 in revenue after fees. I've made just over $22 in profit, and in doing so pushed the best sell price to L$321/USD (or L$1 higher than before). This will force traders to place their buy orders higher (at say L$342/USD) in order to make profit. So, quoting Kanzanture, From: Kazanture Aleixandre
This will continue, and L$ will loose value daily 5-6 points.
This is not a big problem for me actually because in my opiinion because of the lack of supply/sink balance at economy L$ will lose value in one way or another, this is only making it faster.
My question is; do you see such daily L$ traders as a problem for the economy and will take necessary actions for it or not?
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Kelly Linden
Linden Developer
Join date: 29 Mar 2004
Posts: 896
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05-25-2006 14:43
I must still be misunderstanding.
Looking at the market right now, if I want to Buy L$ the best deal I am going to get is: L$330 / US$1.00. L$350,000 will cost me ~US$1063.76.
If I turn around and want to sell those L$ I just bought the best deal I am going to get is: L$358 / US$1.00. This will be an estimated proceeds of ~US$936.21.
I have just lost US$127.55!!
However, if for some reason you could buy L$ for less than you could sell them, then yes you could make money. However the spread generally goes the other way.
If the question is about placing orders so they are the first to be sold to or bought from causing an inherent direction in market movement, I don't think so. Placing orders to sell first means placing them at a higher L$ / US$ rate, true. But placing the orders to buy that will fill first means placing them at a lower L$ / US$ rate.
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- Kelly Linden
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