Short and Long Term Investing

by **[ADMIN] Billious** 29/12/2013, 5:03 pm

Short and Long Term Investing

Short term investments take less than two weeks to complete while long term investments take more than two weeks up to a few months. Long term investment should only be done when you have excessive money and you don't know where to put it. The problem with them is that they tie your money up for an unknown (most of the time) period of time disabling you from being able to continue merchanting with your usual cash stack. On the other hand short term investments make you great profit in short period of time and are mostly there to boost up your cash stack. But compared to long term investment, short term investments generally make less money then long term.

Short Term Investments

Most investing guides cover pretty much everything about short term investments. They're mostly graph based so all you need for them is good graph reading skills and some money. They're the way to go as they make most of your money in a short period of time, tend to have less risk and are the easiest form of investing to learn.

Long Term Investments

Long term investments tie your cash for a longer period of time and they're way more risky than short term investments. The good thing is they make you more money and they require a lot less attention. Long term investments are mostly update investments, rare investments and stable graph investments.

You have to be aware that there's a big risk involved as there will be updates during this long period of time and they can sometimes affect the item in a negative way, ruining your investment. If you want to start a long term investment then start it at the beginning of the month as the BTS is already released which reduces the possibility for an update to harm your item.

Buying the Item
You should buy your item the same way as with short term investing meaning you want to buy it at its lowest point. If there are more low points buy at them if you have extra cash available, assuming the item is going to rise eventually.

Selling the Item
It may be difficult to sell at the peak of the rise as it can sometimes exceed your expectations. If there are no good graph indicators on when to sell, sell as soon as possible. There's no need to be greedy for extra profit and it's better to play it safe. It's always better to sell when the item is rising rather than when it suddenly peaks and starts crashing. You should make greater profits this way and any profit in your bank is always better than items you don't need.

Update Investing
Investing in updates is usually long term. How to deal with it was covered in one of the previous guides.

Stable graph Investing
It works on the same principle as other investments. The difference is that these items are rarely traded or don't vary in price much, so it will take much more time for them to eventually rise or for you to get enough stock for decent profits. They can make better money due to less people merchanting them (stepped graph items) meaning there will be less competition with others, but commonly traded stable items usually don't profit much. However leaving a long term lowball buy offer in for some item like rune chain will always be able to be sold for around it's high alch price.

Rares Investing
Rares have always been a popular investment, but they don't behave as other items in the Runescape economy. They're inclined to rise due to limited number of them in game, but their value is purely sentimental. They don't have any combat stats and are purely cosmetic, discontinued items are used to show a players wealth and in reality aren't that needed in the game. When people stop wanting them the prices will plummet as there is no use for these cosmetic items.
Secondly game updates/rumors are major factor in discontinued item price changes. When there are many updates coming out in a month people might sell their stock to gain money to use in these updates, merchanting and/or game wise. Even if some don't need the money they still do it because they assume other will, lowering the overall price.
Thirdly, there are many other factors that have an affect on the prices of rares. Jagex regulating the economy more and more, degradable items, various money sinks, releasing rares from banned accounts are just a few examples.
Masks and pumpkins rise before Halloween, Santas before Christmas and Easter eggs before Easter. You would think that they would peak each year at these times but they actually don't. For example by the time Christmas comes around Santa hats have generally been falling for anywhere from 1 to 3 months and Christmas is just a small rise as they continue to fall over months. Even though they're inclined to rise they'll still fluctuate up and down making your investment even longer. In my personal opinion they're not worth the time and money as it's completely rubbish profit over time wise. Unless you know you'll be inactive for months or have a bank so massive you won't notice the gp gone, don't invest. If you are going to try these then make sure you look at the historical graphs for them to pick the annual trends. Historical graphs going over the last few years can be found on Merchz or RSWiki.

Special thanks to Julij2 for making this guide with the help of the Investment Mentors Pudd, Connor and the help of Minato.