Risk and Reward

If you are using Auctioneer, it tells you how many times a given item was seen on AH.  This gives you a good indication of how common the item is.  Today I’m going to talk about reselling uncommon items – rare pets, epic gear, rare patterns, etc.  If you’ve read my post on Getting Started With Auction House Trading, you’ll remember about using profit goals to determine the price you are willing to pay for items.  The same rule applies when dealing with uncommon items, but there is a catch.  When you buy/sell common items that have high traffic, you are virtually guaranteed to sell what you’ve bought.  You might take a small loss if you made a mistake, but it won’t be drastic.  When buying uncommon items which have low traffic, you face two potential problems.  First, you don’t know how long it’ll take you to resell them.  This means your money will be tied up and won’t be earning you anything for some time.  Second, you might never sell it.  Hopefully, this isn’t the case since you should’ve done your research before buying the items, but it can happen.  In order to compensate for these two potential problems, you have to demand a higher return on your investment.  For very low traffic items, you need to set your purchase price to get you at least 50-80% profits.  The more unsure you are about when/if you are going to resell the item, the higher the return that you should demand.