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How much capital should be locked in escrow?
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Aurilen Isu
Extramordinary
#1 - 2014-10-20 03:46:10 UTC
Is there some ballpark figure regarding how much of my capital should be locked in escrow and how much I should keep in my wallet. I have the irrational fear of not having enough isk to complete a transaction. I also have margin trading V
Wedgie Nelson
Dogs of Capitalism Stellar Trade Clearinghouse
#2 - 2014-10-20 04:58:16 UTC  |  Edited by: Wedgie Nelson
Aurilen Isu wrote:
Is there some ballpark figure regarding how much of my capital should be locked in escrow and how much I should keep in my wallet. I have the irrational fear of not having enough isk to complete a transaction. I also have margin trading V




0% don't be a deadbeat margin buyer., Seriously though, it doesn't matter, you shouldn't be tying up every cent you have in the market at one time, quality not quantity
Koniforous
Tauren Transit
#3 - 2014-10-20 10:19:56 UTC
Cista2
EVE Museum
#4 - 2014-10-20 13:38:33 UTC
If gaining profit is your aim, then ask yourself:
If you have 1 bn isk in your wallet, and 1 bn isk in escrow, which billion will lead to profit, and which one will not?

My channel: "Signatures" -
Mari Hata
Main Street Crafts and Goods
#5 - 2014-10-20 15:33:04 UTC
Aurilen Isu wrote:
I have the irrational fear of not having enough isk to complete a transaction.


If it has not already happened to you, at least once, surely you are not investing enough! Lol

♫ ♪ ♪
Hel O'Ween
Men On A Mission
#6 - 2014-10-20 16:22:15 UTC
If you expect some hard numbers/percnatges as an answer - I think that's impossible. Because it highly depends on your trading habits.

For example, if you deal in fast-moving items, wallet can be very low, as the steady flow of purchase/sell will assure that there's always enough liquidity in your wallet.

If OTOH you're dealing with high priced, slow moving items, where it might take quite some time before you can sell your items (for a profit), but you also want to make sure that (another) cheap purchase doesn't slip between your fingers - your wallet should be able to cover it.

tl;dr
Your guts (aka "past experience") should tell you.

P.S. Don't be afraid of the dark ... Blink

EVEWalletAware - an offline wallet manager.
350125GO
Sebiestor Tribe
Minmatar Republic
#7 - 2014-10-20 16:38:49 UTC
There's no penalty for defaulting on an order, so you can go all in for escrow, however, doing that means you'll have to keep a better eye on your buy orders too. If you're over-committed and not paying attention the market could swing and you'll get hosed. Especially if you're just putting up massive buy orders in one region. If you're escrow is spread out of many orders of different items there's less risk there, and less risk of defaulting on anything.

I'm usually at 25% escrow to cash, but I'm not a massive trader either. I'm guessing the people who do this aggressively are at 75% or more.

You're young, you'll adjust. I'm old, I'll get used to it.
Han Chang
a Blueprint Holding Corporation
#8 - 2014-10-21 00:55:37 UTC
Personally I always keep 100% of escrow in my wallet in case I skip town all of a sudden I can come back with a hanger fool of goodies. When I am actively trading for the week I will go down to 75%-50% in wallet if my bids are doing well. Just personal preference. Also, with having so much extra in my wallet I can do emergency buy plans for really hot orders.
BonusPoppa
State War Academy
Caldari State
#9 - 2014-10-23 15:50:26 UTC
i go all in but i'm still pretty new/bad at this trading thing
Nathan Shavit
Shavit Risk Management
#10 - 2014-11-07 14:44:22 UTC
Invest what you can afford, set aside what you think you might need for a rainy day.

There is no problem an air strike cannot solve.
Princess Honneamise
#11 - 2014-11-09 11:38:10 UTC
Cista2 wrote:
If gaining profit is your aim, then ask yourself:
If you have 1 bn isk in your wallet, and 1 bn isk in escrow, which billion will lead to profit, and which one will not?


this !

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http://eve-moons.com

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plex alt 908671098348
Stratton Oakmont Inc
#12 - 2014-11-11 02:48:21 UTC  |  Edited by: plex alt 908671098348
I got a question about this... if I have 2 billion in escrow (means 2 bil has already been deducted from my wallet and is "in the market") and I place a new buy order for 1 bil (raising escrow to 2.25 bil because margin trading 5), now ceretis paribus someone sells to my buy order worth 1 bil (remember there is 2.25 bil TOTAL isk in escrow) but there's only 100 mil in wallet, will the order get filled or will it fail?
TheSmokingHertog
Julia's Interstellar Trade Emperium
#13 - 2014-11-11 05:23:00 UTC  |  Edited by: TheSmokingHertog
I take care to have at least 50% of the needed volume in ISK in my buy wallet @ all times. - let me add that this is markets with very high turnover speeds.

"Dogma is kind of like quantum physics, observing the dogma state will change it." ~ CCP Prism X

"Schrödinger's Missile. I dig it." ~ Makari Aeron

-= "Brain in a Box on Singularity" - April 2015 =-
Varius Xeral
Doomheim
#14 - 2014-11-11 05:33:32 UTC
The bare minimum needed to make sure you don't default, or that which balances the risk of default with the potential gains from overextension.

In other words...it depends.

Official Representative of The Nullsec Zealot Cabal
SJ Astralana
Syncore
#15 - 2014-11-11 23:14:27 UTC
Escrow management is almost like hedging, in that you should mitigate your risk. If you have an inbound cash flow from sales that in general covers your outbound cash in purchases, you're covered. Your sales reporting should tell you that. For instance, as a T1 producer, I don't hesitate to place material buy orders on margin because on average my sales exceed my purchases by about 10%. This is also mitigated by a majority of my buy orders competing against range pricing, which naturally slows down the outflow of cash.

Hyperdrive your production business: Eve Production Manager

Triturus Alpestris
Bad Taste.
#16 - 2014-11-15 09:05:11 UTC
20%