Why buy shares?

[John uncguy43 Williams]

Doing the math, it appears that most shares on the exchange are currently paying a return of about 5%/year given current prices and weekly payouts.

Given that you can go open a money market account and make 5+% at most banks or investment funds with practically no risk, why do people continue to buy shares in Entropia for similar returns with, arguably, substantially more risk?

Not saying it's right or wrong...just curious to hear the opinions that are out there.

 

[Dibbler]

There are shares irl out there with way higher market cap and higher yearly dividends than any in game shares, however to hold ped aside for a pittance of interest ingame they are kinda useful in some respect.

 

[ProActive Mango]

People dont know alot of finance in real life.
In entropia you can "hide" your wallet from your wife!
In entropia you can play and have fun and owning deeds is a way to have your peds working for your lifestyle in entropia without deposit all the time.

BTW Buy moon deeds, those are the best deeds atm!

 

[In Love With]

Not sure what investments you are referring to, but when talking to my bank, I get offered 3% max on anything and then the money would be blocked for at least 2x years ... Plus keep in mind that many ppl have bought ingame shares at a lot lower (Underground deeds at 50 Ped and especially CLDs at 1k when they first came out) ...

 

[ZPF]

practically no risk

US bank failures probably spooked a lot of boomers

Not sure what investments you are referring to

I'm assuming you don't live in the U.S. High yield savings accounts are paying 5%+ over here.

You can still buy US govt bonds. They are currently paying 4-5%.
Pretty much risk-free unless you think nuclear war is coming.

 

[Dibbler]

Not sure what investments you are referring to, but when talking to my bank, I get offered 3% max on anything and then the money would be blocked for at least 2x years ... Plus keep in mind that many ppl have bought ingame shares at a lot lower (Underground deeds at 50 Ped and especially CLDs at 1k when they first came out) ...

PSEC - 9.xx% divi payed monthly (got those really cheap though maybe not so smart currently)
Realty Income Corporation's ( O ) dividend yield is 5.29%
MO annual dividend yield is 8.6%

etc etc, are many out there.

Personally first days of lockdawns when stockmarkets crashed i threw everything i had into BP, Shell, Centrica, MO and other normal times high divi stock. Made a fair buck so most of what i hold now are effectively free. Other profits placed into long term ETF's in sectors i predicting growth over next 10-15 years overall.

Ingame shares i use to hold ped so not tempted to spend to save for better gear, so have uses. Also buying at start when cld were like 1000 pear deed was smart move long term. Not saying ingame are bad, just i have better places for irl cash currently.

 

[John uncguy43 Williams]

It sounds like I'm hearing two main reasons:

1) In-game behavior management
2) Hide money from wife

 

[Dibbler]

It sounds like I'm hearing two main reasons:

1) In-game behavior management
2) Hide money from wife

Sounds about right

 

[Larry]

Buying shares in-game now makes no sense.

- Fees to buy ped (if depositing to buy shares)
- Fees to buy the shares
- Fees every time you 'list' your shares for sale
- Fees to withdraw to a bank account

Take all these fees off and you're not really making anything any more.

Then factor in the shrinking player base, the hints of new share listings coming, the 'extremely' poor design of the in-game exchange (no buy orders, fee structure, etc) and the lack of liquidity and yeah, in my opinion, you're better putting your money somewhere else.

 

[San]

They were better than that for a while, there are threads here on the forum tracking returns you can look up. People have been escalating the shares' price point up to where the return percentage is no longer so attractive. Same thing as what happens to markups in-game. Always.

 

[SoberPhil]

Buying shares makes sense to people who have PED ingame but they do now want to withdraw or quit, it could be a good idea if you're saving for an ingame longterm project as well. Some might hold on to them thinking that prices will go up later.

But from an investment standpoint you assessment is correct.

 

[DaisyColdFinger]

Given that you can go open a money market account and make 5+% at most banks or investment funds with practically no risk, why do people continue to buy shares in Entropia for similar returns with, arguably, substantially more risk?

better the devil they "know"

 

[monte]

Given that you can go open a money market account and make 5+% at most banks or investment funds with practically no risk, why do people continue to buy shares in Entropia for similar returns with, arguably, substantially more

I don't think the vast majority on here know how to invest properly at all. The price many are wiling to pay for silly low lvl 2.0 weps.. the horrible valuation people are happily paying for unreal tokens.. people wasting so much valuable time sweating and running small shops that net them pennies.. it's rampant. Deeds really are just for adding a couple bucks to in game wallets and dodging taxes/wives. People generally don't know how to invest irl either so no surprise.

 

[Hego Damask]

Speculation reasons, to sell them much higher when tradeable, like it happend with CP shares, there is no other reason i would buy shares.

 

[theProphet]

You can still buy US govt bonds. They are currently paying 4-5%.
Pretty much risk-free unless you think nuclear war is coming.

sounds like you don't have an idea about all the people and companies who burned their fingers on "risk-free" longterm government bonds

 

[ZPF]

sounds like you don't have an idea about all the people and companies who burned their fingers on "risk-free" longterm government bonds

The U.S bank failures had nothing to do with the actual bonds. If you got burned during that period, it's because you invested your money with morons.

When a bank carries a large amount of bonds on their balance sheet there is something called "interest rate risk" they need to be aware of. When interest rates rise, the value of these bonds gets marked down significantly.

The US banks that got crushed decided not to hedge against this risk because they thought they were smarter than everyone else.

It's not something you or me needs to worry about when buying bonds, as long as we plan on holding them to "maturity". When a bond "matures", you get repaid the principal amount.

You can buy bonds directly from the U.S government. In the ~100 years since the US began selling bonds, we've never missed a payment.

 

[Evey]

It's not always pure math, people want different things and also are not looking to put too much effort in something they want.

Speculation reasons, to sell them much higher when tradeable, like it happend with CP shares, there is no other reason i would buy shares.

90% of people buy shares in EU for the above reason. There are still others that take a break, sell gear and place their money into something that give some returns, others don't want to move the funds out of laziness maybe, hate the withdrawal taxes and time, but I think there are also some people (too few unfortunately) that like to support a project close to their heart and invest in it, invest in their passion, hoping to see it grow further, or just put something small but enough to feel they are a part of it.
All the above reasons are right reasons and there's no 100% general rule to do it one way or the other, as long as people do what makes them feel satisfied.

 

[Angela Draniie Cloud]

Not sure what investments you are referring to, but when talking to my bank, I get offered 3% max on anything and then the money would be blocked for at least 2x years ... Plus keep in mind that many ppl have bought ingame shares at a lot lower (Underground deeds at 50 Ped and especially CLDs at 1k when they first came out) ...

Even apple is giving like 4.5% or something right now lmao

 

[PreyNaika]

Its exactly the same risk like leaving more then 100.000 Euro on a Bank Account, read the stuff thats written small everything more then 100.000 invest them in what ever , enteopia , Rolex,cars,real estates, trade

Its even a risk to have that money in currency @ all

1. you live in constant danger when people find out how much you have
2. Gov wants your money too

One of those two will come one day


But yeah i dont see the point to invest into deeds, maybe because i burned my ass on compet when they first came , and maybe because i did sell 500 moon deeds for 50 ped to the auction order

Edit *

One very importent thing i forgot , entropia does not tax your profit

If i invest 100.000 Euro i will have to pay 46% of my profit
Lets say i profit 100.000 then the gov taxes me 46.000 Euro

If i invest 1.000.000 into entropia the only tax i will have to pay is the fee they ask if i deside to take my money out
(Later on you will pay the 46% too) but meanwhile you can use the force of the profit to Generate more profit , leads to more potential.

I am ready to invest, the game is not ready for me, this means that the economy of entropia / its amount of players is not ready for big investments. Like you can have funn with it but its not rly profitable.

Turns a smart Person rather Puts his money into a Apartment or house, keep it for 10 years and sells it tax free for profit (profit from 150% up to 250% avarge) or put it into Gold and keep it for one year and one day , then sells it tax free

But in the end: entropia is a game and faaaaaaaaaaar away from real investments, thats not even pocket money in the World of Business

And it also depends where you live ,
If you live in a Land where 400 Euro is the avarge monthly, then entropia is profitable. While in the us or most of europe you get more working as dishwasher in a Pizza Shop that does not got dish to wash @ all.

I think entropia is a great way to learn Markets, finance and everything that Covers this Sector. Just dont play drunk

 

[ProActive Mango]

Its exactly the same risk like leaving more then 100.000 Euro on a Bank Account, read the stuff thats written small everything more then 100.000 invest them in what ever , enteopia , Rolex,cars,real estates, trade

Its even a risk to have that money in currency @ all

1. If you live in constant danger when people find out how much you have
2. Gov wants your money too

One of those two will come one day


But yeah i dont see the point to invest into deeds, maybe because i burned my ass on compet when they first came , and maybe because i did sell 500 moon deeds for 50 ped to the auction order

Edit *

One very importent thing i forgot , entropia does not tax your profit

If i invest 100.000 Euro i will have to pay 46% of my profit
Lets say i profit 100.000 then the gov taxes me 46.000 Euro

If i invest 1.000.000 into entropia the only tax i will have to pay is the fee they ask if i deside to take my money out
(Later on you will pay the 46% too) but meanwhile you can use the force of the profit to Generate more profit , leads to more potential.

I am ready to invest, the game is not ready for me, this means that the economy of entropia / its amount of players is not ready for big investments. Like you can have funn with it but its not rly profitable.

Turns a smart Person rather Puts his money into a Apartment or house, keep it for 10 years and sells it tax free for profit (profit from 150% up to 250% avarge) or put it into Gold and keep it for one year and one day , then sells it tax free

But in the end: entropia is a game and faaaaaaaaaaar away from real investments, thats not even pocket money in the World of Business

And it also depends where you live ,
If you live in a Land where 400 Euro is the avarge monthly, then entropia is profitable. While in the us or most of europe you get more working as dishwasher in a Pizza Shop that does not got dish to wash @ all.

I think entropia is a great way to learn Markets, finance and everything that Covers this Sector. Just dont play drunk

Perhaps buy some moon deeds now that they are cheap to invest into deeds again