Runescape Merchanting Guide

Table of Contents
What to Merchant:
How to Merchant:

Flooring the Market

What you need to know: If you have the gold coins, leverage your wealth to prevent your investment items from losing value.

This is the strong-arm tactic of successful merchants (and sometimes clan chats) - often where 1 billion GP+ in assets can be leveraged to force a profit or stop monetary losses. If prices of an item invested in appear to be in free-fall it is possible to force the price upward or stall further decreases simply by placing a massive buy offer under which no other offers can complete.
This strategy is predicated on the fact that the grand exchange process offers on a first-in basis. In other words, the grand exchange processes the oldest offers first when buy and sell prices match. Careful observers will realize this is precisely how merchanting clans work. Pump an item, tons of people buy it, sell it later.

Putting in a price floor has become an increasingly interesting and lucrative option after the release of free trade. This is because it is now possible, and is in fact common place, for merchants to skirt grand exchange quantity limits simply by transferring large quantities of GP (or items) to other accounts. In essence, once you have enough money, you can you can guarantee profit if you can command the market by moving your money. This is how putting in a floor works:

You bought 500 million worth of Yew Logs at 100gp each. You go on vacation for a week and come back to find that the price is now 90gp each. After panicking for a moment, realizing you've just lost 50 million GP, you place a massive buy offer for over 500 million at 90gp each. This offer will immediately begin to buy out the market. Consequently, anyone selling yew logs below that price will sell them to you (first-in); anyone looking to buy Yew Logs will need to pay over 90gp each in order for their buy order to be fulfilled. Slowly, the price will inch upward, and when it does you will recoup your potential 50 million GP loss, and make some extra cash.
Warning: Selling all of your logs at one point will cause the market to crash. You will need to unload them slowly and methodically. The upward force you've propelled can also turn into downward pressure if you try and sell all your logs at one time.

A picture supplied by a fan showing the type of assets that allow for strong-arm tactics such as price flooring

There are, however, a couple of limitations to this strategy, most of which are based purely on market scale. This strategy works best with members-only items, which are not subject to some of the same pitfalls as the free-to-play market where there are an outrageous number of players constantly flooding the market with consumables in hopes of making money. Additionally, there are a significant number of merchants trying to make money in these markets. Most of them aren't very good and will eventually just dump their items in defeat. In these markets a large sum of gold could put in a price floor, but it would not hold up very long as there is a never-ending supply of goods coming on the market as players aim to make money and raise their skill levels. These supplies prevent price manipulation. Examples of items to avoid include: lobsters, logs, coal, and the like.
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