Market Discussions

Can only speak for myself. My role in a bond is to hold collateral for the bond to make sure that the person running the bond doesn't run away with the ISK, or in the case they do so make sure the investors get back their original investments.

Can also apply if the pilot running the bond stop paying interest or in other ways show that he/she is not intending to do the bond as outlined.

I usually require the bonds I assisst in to be over-collaterized. So if you're asking for a 10b bond I may require you to give me 12b collateral both to protect the investors as well as market changes depending on how and what the bond aims to do.

My fee is usually a static one of a few hundred million ISK, depending on type of bond, collateral and amount of time it runs.

/c

Usually it would be you that give me the 12b in order to get the 10b from the investors. Depends on the type of bond and plans.

There could be situations where the investors money go to me to buy for example blueprints which I then buy and make copies of to you to sell and give out dividends from.

But most of the times yeah I hold collateral you give me, then you get ISK from investors.

/c

It's quite simple.You give the 3rd party 12 B worth of stuff , then the investors either give you direclty 10 B or it goes through the 3rd party middleman to you.Each month you pay the interest to the customers directly who then vouch they have gotten it.If all goes well at the end of the bond you get your collateral back and investors get their initial amount back.If **** hits the fan and you don't pay interest or ''get hit by a bus'' the 3rd party sells all the colleteral and provides the investors their initial investment back.

In some cases , you can directly trade the collateral to the investor but that has to mean that you know that person is trustworthy enough to not just walk away with the overcollateral you gave him.And knowing someone is trustworthy enough is kinda hard in eve hence we have the 3rd parties.

Thanks again Sabritz !

My question is, why a 20% collateral for the 3rd party ? (for ex. what is justifying 2b collateral on the 10b loan) ?
the market is of course fluctuating, but I don't understand why 20%

Thanks;

Lakota Ellecon, CEO/RGI

20% is due to Pareto's principle... google it ;).

You don't need to lend people a certain big amount. There are many offers, you can distribute your money.

Loan / Bond = in liquid ingame ISK
Collateral in exchange for bond, to cover for contract default = collateral of items value, not liquid asset.

Collateral requires to be liquidated to have any value, or to have an ISK value.
It may or may not cost more than 2 b ISK to liquidate 12b worth of asset (relative worth that is).

In fact, if you have 144b worth of assets and it costs 30b to liquidate, you make 14b on the total work, which make take a few months to do.


For instance, if you have 12b worth of 1m each Serpentis 30 days skins, it may be a rip off.
(They don't make that much volume yet)

So, if you think your 12b collateral on day 1 is worth more on day 30 or 60, or on terms,
you can offer the lender , bonding agent (party) to accept liquid ISK in exchange.

Remember that ISK value is likely to depreciate with time, even though this may also not be true.
So, if the other party wants the new deal, the third party could do it, if both party agrees.
Of course, due to the original contract, the other party can keep the collateral, or your due payment, if you agreed to pay money back instead of collateral items.

So 12b in 2 months is worth less or can be worth less than 10b today, although, 10b today may not be worth anything, and 12b in 2 months may save your life or alliance.


He's buying your time, and you're selling him your time.

I'm actually thinking to invest money for some trusted pilots.