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postheadericon Warcraft Advanced Gold Guide – Portfolio Management

 

Mageweave Cloth ALLIANCE image 26 24 28 31 33 35 35 21
Mageweave Cloth HORDE image 44 45 51 53 67 66 44 29

Above is the data for the item “Mageweave Cloth” taken from European server “Anachronos” over a period of 16 days in August 2009. The prices are in silver pieces per individual piece of cloth.

 

This data in the Material master will give you some clues as to whether this item is a potential profit maker.

Firstly, the average price in Alliance auction house is 29.13 silver pieces per cloth
The average price in horde auction house is 50 silver pieces per cloth

So instantly we know that to buy from alliance and sell from horde gives us a very good average profit (the price difference is 72%)

Buying from Alliance and selling to Horde is a no-brainer.

The standard deviation is 5.22 on Alliance and 12.44 for Horde.

This tells us that buying from alliance to sell at a later date to the same market is not a particularly good choice. A standard deviation in single figures is a pretty good indicator of a low margin potential.

Horde however is a different matter. 12.44 tells you that buying low and selling high in the Horde auction house  is a great idea for  someone playing a single market strategy.

However, there is an issue. Closer examination of the data shows that we have a “rogue” figure.
7 of the 8 data points for horde are between 44 and 67 silver pieces per cloth. One point is however 29, silver pieces per cloth.

 

This low figure is capable of skewing the figures quite a bit. However, if you replaced that figure with the average of 50 would give you a standard deviation of just below 10, and an average even higher at 52.63

These are still great figures for either a single market or a cross market selling strategy.

Okay, to normalize the figures and obtain a price index take the following steps.

  •   Work out which is the “Buy From” market  – in this case Alliance.
  •   Take the worst buy price from this market (i.e the highest price) – In this case 35 silver pieces.
  •   Give this 35 silver pieces the Index rating of 1.00 (one point zero zero).
  •   Rate every other price as a ratio of this price

Another option is to take the average price and give that an index rating of 1.0. You would use this if you were comparing prices across servers, or comparing PvP servers with PvE for example.

 

ALLIANCE
MAGEWEAVE
PRICES
image 26 24 28 31 33 35 35 21
ALLIANCE
MAGEWEAVE
INDEX
image 0.74 0.69 0.8 0.89 0.94 1 1 0.6

 

Once indexed, here are the Alliance prices. Below are the Horde prices. Remember they are indexed as an average price over time across BOTH factions auction house readings.

 

HORDE
MAGEWEAVE
PRICES
image 44 46 51 53 67 66 44 29
HORDE
MAGEWEAVE
INDEX
image 1.26 1.31 1.46 1.51 1.91 1.89 1.26 1.43

The top row of each factions data set shows the actual prices, the bottom row the “price index” As you can see 35 silver pieces is rated as 1, every other price is a ratio of this price. In this way you can compare item against item, even server against server without worry.

 

Below is a video we have added showing the Material Master spreadsheet. This will be a download on this site once the serialization of the Advanced Gold Guide is complete.

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