SLI Chun’s money buying guide for Second Life:
Buying L$? Do it smart. You get more..and no..not by using some exotic scheme, you just buy them directly from Linden Labs.
Buying L$ the normal way
Click the “Buy L$” button (or choose it in your world menu when using Phoenix), type how much you want, and off you are buying yourself Linden Dollars. A few seconds later they are on your account and you can start spending.
Let’s say you are buying 1000 L$. What happens is that the software puts a buy order for you at the Lindex exchange to buy 1000 L$ at the current rate and adds a US$0.30 commission on top of it. That amount is billed on your credit card or paypal and you get the cash on your account. Let’s say the exchange rate is 268, then you get billed 1000/268 + 0.30 = US$ 4.03.
That commission isn’t a very big deal, but you could save a dollar a month by not buying your money in little weekly chunks but e.g. in bigger monthly chunks.
Let’s go for the big work. Change the order you place just a little bit..not buying for the current rate but for the best rate that comes up in next half an hour or so. That will put more L$ in your pocket for the same price. You can wait longer than half an hour? Then you’ll get even more.
the Lindex
Let’s discover that Lindex Currency Exchange thing a bit. No worries, it sounds all very more complicated than it is.
- Log on at your second life account.
- On the dashboard at the left you see Linden Exchange somewhere in the middle with a “manage” link. Click that.
- A menu opens. Here choose L$ exchange settings.
- On the screen that comes now you can change only one setting, the interface mode. This is about how much information you will see displayed later on. It is set to basic, change it in advanced. Yeah, we’ll do some advanced money trading (;
- Now click the Buy L$ link. We are ready to proceed. Next time you come to buy L$ you can click this link directly, no need to set that advanced interface mode again.
Below a print of the interesting part of that screen. You have two boxes in which you can buy L$. At the one on top you still buy it the old way, we need the one below that, where we can specify a rate ourselves.
Open Sell orders
On the left side you see the open sell orders. That are orders placed by people who want to sell L$ (and have choosen not to sell at the current rate but at a rate they specified). A few hundred thousand L$ is offered for L$262, and then millions for L$261, the list continues with $260 and so on.
When you buy your L$ the normal way the best rate from this list is taken. So, you would get 5000 L$ at 5000/262+0.30 = US$ 19.38.
Open buy orders
On the right you see buy orders, from residents who want to buy L$ at a specific rate. As you see in total for millions at a rate of 272. They are waiting for someone who is in a hurry to sell his L$ and that someone will come, all day long residents are exchanging at the current rate.
Look at this column to determine your price (and then compare it with the open sell orders to see your gain). Already more than 20 million is waiting at a rate of 272, so if you also want to sell at 272, you be last in queue..it is not predictable – it is but then you should get much deeper into this – if and when your order gets executed.
Let’s buy at 271. That way we are first in the queue. We get our L$5000 at a price of 5000/271+0.30 = US$ 18.75, saving ourselves 3%
Specify in the buy box (the advanced one) the amount of 5000 and the rate of 271 and click the buy button. You’ll have to verify your order by logging in again. Then go for a little walk, come back in 2 minutes and your money is bought.
A bit disappointed you only gained 3%…keep on reading..
Getting the max out of it
Better rate
We should have choosen a rate of 272 or even 273. With 273 we would pay US$ 18.61, our gain becoming 4%. A rule of thumb could be that normally the spread is L$ 11. Take the best sell rate that has more than a million L$ waiting, in this case 261, add 11 to it..you come at 272.
272 is a rate at which you can expect to buy at somewhere in the coming days, 273 is also likely (as it is “only” 18 million waiting at 272).
Of course you take a risk of having to wait or even of your order never being executed. In the last case make sure you clean it up after a while, as the order will just stay. It could also get executed in a week or two. (choose Manage / Transaction History to see your open orders, there you can also cancel it)
Less risk
In this example we would have gotten a quite reasonable rate by just buying it the normal way but during a day the rate fluctuates. We could have also have had bad luck and got our L$ at a rate of 260. By placing the order yourself you exclude that risk.
Less fees
The U$0.30 fee makes up 1.6% of what you pay. So, buying once 10.000 instead of twice 5.000 saves you an extra 0.8%
Roundings
You don’t have to buy a round number of L$. You could also buy L$ 5012 or so. This is more for those who understand about maths..but you could get that last cent (about 2.5 L$) for free by choosing the amount that way that it gets rounded in your advantage.
more…more..more..more
Place your orders carefully and be patient. You will need to understand how the Lindex works to get really the maximum out of it. With my few little tricks you get on the average about L$12 more per US$. Perhaps a smart trader could get some more out of it..
But you’ll have to figure that out yourself.
Is it really worth the effort?
If all this is worth the effort for a few percent extra, is up to you. The first time it costs some effort, the next time you just fill in the form and hit the button. When you buy a lot and a lot of L$, you could save quite some. But when you buy a little cause your budget is very small you might appreciate a little gain even more.
It is all up to you.
A word about “Professional traders”
All those millions you see at the Lindex (Millions of L$, not real $), it is not all buisness owners trying to sell L$ and normal users (or starting businesses) trying to buy it. A big chunk comes from traders.
They simply try to buy L$ at the lowest rate and sell it at the highest rate, that way using the daily fluctuations. Due to them we can be sure the spread is always around L$ 11. It is not risk-free what they do, when the L$ would drop they end up with all those L$, at a much higher rate as they could ever sell it for. (the people in Iceland might know these things do happen and can hurt)
Everytime they buy they pay L$0.30, everytime they sell 3.5%. At the L$ 11 spread that leaves them a little profit. (The spread must be more than 3.5% of the sell price)
It is a simple business but the risk might be quite high as one needs a lot of cash to put into this. You think about doing this yourself? Learn more first, the little info I gave you is not enough to be successful as a currency broker.