How to Trade
Joining Second Life Solutions
Before you can begin trading, you must set up an account with Second Life Solutions and link it to your Second Life
avatar. This is a very simple process. Just choose the "Create New Account" link in the menu and follow the
instructions. Within a few minutes, you'll be able to log in and begin trading.
What are we Buying and Selling Here?
You are buying and selling equity positions (fractional ownership) in publicly owned and traded Second Life
corporations.
Why on Earth Would we Want to do That?
Historically, the Second Life economy and its massive revenue have been dominated by a few elite individuals who are
willing to personally take on the risk of tiering large land inventories, and are willing to deal with other large
expenses. The Metaverse Stock Exchange opens up this earnings potential to EVERY resident of Second Life who
chooses to invest in publicly owned and traded companies. Even basic account holders who are personally unable to
tier even a single square meter of land can now invest in and profit from the explosive economic marketplace which
exists in Second Life! If this sounds exciting to you, read on!
What the Numbers Mean
Once you've set up your account and deposited funds into it via our in-world ATM, you'll be able to log into the
web site and begin trading shares of any publicly owned company listed under "Markets" in the menu (currently,
Cyberland is the only company listed on this exchange). Before you can make successful investment decisions, though,
you'll need to know a little bit about what the numbers on the markets page mean. The two main areas to be concerned
with are the company overview table and the market overview table.
The Company Overview
In the company overview, you will see the total grid-wide inventory of land owned by this company, the
amount of cash the company currently has on hand, the average price that the company has paid for it's land inventory
per square meter, and the number of shares outstanding. Using these numbers, we can calculate at the liquidation value
of one share at any particular moment in time.
These statistics are nearly real-time. When the numbers change in-world, a script reports this to the exchange, which
then updates the land inventory and cash reserve accordingly. The delay on this update is generally around 5 seconds.
Every ten minutes, the cost of tiering the land for the previous ten minutes is calculated in L$ and deducted from the
cash reserves. When new inventory is purchased, there is a delay of a few minutes to an hour on the company overview
update due to the fact that this information must be entered into the database manually.
The Market Overview
In the market overview, you will see the total trades executed on this market since the company was listed, the number
of trades executed today, the trading volume (number of shares traded) today, the price per share of the last trade
executed, the highest and lowest trading prices today, and the average trading price for today. Next to this overview
you will also find seven-day historical trading data. Thirty-day historical trading data is planned for the near future.
All information in the market overview table is real-time. That is to say, the market overview is updated during the
execution of each trade, so whenever you load a market page you are seeing the most up-to-date information.
The Two Ways to Trade
There are two ways of trading shares. The first method is to post buy orders and sell orders. The second method is to
fill buy orders and sell orders posted by other investors.
Posting Buy and Sell Orders
Buy and sell orders are essentially "want ads" for shares. Someone posting a buy order wants to buy a certain number of
shares at a certain price per share. Someone posting a sell order wants to sell a certain number of shares at a certain
price per share.
If you post a buy order, and the share value moves to around or below your requested price per share, there is a good
chance that your order will be filled by a seller. Similarly, if you post a sell order and the share value moves to
around or above your requested price per share, there is a good chance that your order will be filled by a buyer. As
you can see, the market is only indirectly tied to the real share value at any particular moment in time. Shares can
be bought or sold for any price irrespective of the actual share value at the time of the trade.
It is important to note that you MUST have the funds or shares required for a trade in your holdings prior to posting
a market order. All funds or shares required to execute your trade will be escrowed (removed from your holdings and
held in trust) at the time you post the order so they are guaranteed to be available at the time your order is
filled. Canceling a market order (your open orders are always highlighted in yellow with a cancel link next to them)
will result in the escrowed funds or shares being immediately returned to your holdings.
Filling Open Market Orders
You can fill an open buy or sell order by clicking the "buy" or "sell" link next to it on the markets page. When you
fill a buy order, you are selling shares. When the trade is executed, the shares required to fill the order are sent
from your holdings to the buyer's holdings, and the funds which were escrowed by the buyer at the time they posted the
order are sent to your holdings. When you fill a sell order, you are buying shares. When the trade is executed,
the funds required to fill the order are sent from your holdings to the seller's holdings, and the shares which were
escrowed by the seller at the time they posted the order are sent to your holdings.
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