WOW Trader Segment #5

Welcome to wow trader your source of wow auction house epic knowledge. This is Miy, spelled M I Y, your host and this is your wow trader segment for AIE podcast number 21.

Announcements:
3.1 is coming
AA version is out.


Today we will be discussing two things,

1. Patch equals profit
2. Postponed consumption and opportunity cost

Last week we discussed the cycles and shift in demand, today we will talk about how to profit ofof them. The biggest shift comes with patches, imagine that Patches are like high tide, the prices rise and the economy picks up, in between patches the economy goes reaches low tide, until the next patch comes and tide goes back up.

So first off, a Patch equals profit:

Patches bring new things into the game, patch notes are a source of information on what will be profitable in the future and what purchased today will be worth more later. A good example would have been the 2.4 patch. When 2.4 hit it introduced a variety of things into the game, a easily accessable source of gold from dailies, new gear from the new instance and raid, and a new season of pvp gear. This meant the people had more gold then ever and lots of new gear in need of enchantments and gems.

To capitalize off of this I took over the uncommon level gem market for two weeks on my old server, I raised the price of all uncommon gems by 500%, I bought all gems that sold for less than mine and undercut anyone close to the 500% margin I had set. At the end of two weeks this had brought in over 10,000 gold. 

Patches bring a variety of new ways to make a lot of gold, the main thing to think about is, whats new in the patch, and what will people need because of these new things.


Second topic is postponed consumption and opportunity cost

This topic ties in with patches but in the opposite way, when new things enter the market they are always expensive, in the case of my gems, if you didn’t have them before I started selling them, you would have had to pay my price to get them. After a patch you want to be a seller, not a buyer, everything is going to be expensive after a new patch hits, one of the best examples from recently would be the tailor made cloth and dragon eyes.

Both of these items sold for 400-500 gold at the release of wrath of the litch king, but currently only sell for about 100g. by postponing our consumption we could have sold our cloth and dragon eyes for lots of gold then and now purchased what we need if any for 20% of what they originally sold for. As a jewelcrafter the dragon eyes were purchased with the token for a 5 min quest that is a daily. By analyzing my options I had two choices, one was to use these token to buy jewelcrafting recipes, the other was to use the token to buy a dragons eye each day and sell it. 

Remember that opportunity cost it what you give up to get something, so by buying a gem recipe for three tokens I gave up selling three dragons eye, or 1500g. 5 token recipes cost 2500g, and the epic patterns cost 3000g. I then asked myself would it be more profitable to cut gems, or sell dragons eyes, since the profit on most of these recipes was around 25g for each cut, it meant I would have needed to sell 60 gems of each cut I bought in order to break even with just selling dragons eyes, on top of this I would need to sell 60 gems before the price of dragons eyes had dropped. Right now those same recipes run me 300g to aquire versus 1500, and the profit margin is less but still decent.

So by delaying our consumption and asking what our opportunity cost is we can make a lot of gold.


Thanks for listening to Wow trader your source for gold


Thanks for listening to Wowtrader your source for papa hummels biscuits for your wow wealth. This is Miy saying may your gold flow like the blood of your enemies, for the horde!