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Stock market game: Blocking buying/selling stocks

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larienna
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I have an issue in a stock market game. I have computer simulations that play the game with different AI. There is a dumb AI that sells all his share each turn, and buy the lowest possible stocks. That AI surpasses all other players and wins all the time.

Also since players can buy or sell stocks each turn, they are not likely to try long term investment. In the original "St0ck T!cker", only 1 player could buy or sell stock at a time. Which created a situation where you could not adjust your portfolio quickly after the market moves, you had to wait for your turn.

Now I think, that not being allowed to buy or sell for a certain amount of time could be a solution to my problem, but I am not really sure how I should lock/unlock stocks in a way that makes sense and that is interesting. I came up with 2 methods so far:

A) Restriction by phase: Each year is 4 turns, so I could say that both buying and selling stocks can be done at the start of the year, but later during the year, you cannot do both. You can either buy or sell. I think restraining selling during the year would make more sense mechanically. It would prevent players from leaving the boat quickly, and they would have to plan more in long term.

B) Restrain by stock: Each turn, only 3 out of 8 stocks are considered "Active" and can be bought or sold. The other 5 stocks are locked. This creates a window of opportunity where players can decide if they jump in, stay or leave the boat. The active stocks would be determined randomly. 1, 2 or stocks would changes each turn depending on the window of opportunity I want to give to players That means certain stocks could remain locked or active or a long period of time if unlucky depending on the randomness mechanism.

Solution B looks more interesting, but both solutions does not seems to make sense thematically.

Else have you seen other games which blocks buying and selling stocks in certain situations?

questccg
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I have an idea for you...

Why not include an Administration Fee which corresponds to the Broker's Fee for buying and/or selling. This would mean if you sell ALL you stocks, it might cost a HIGH Brokerage Fee and make it near impossible to keep up with the normal players that are trying to make sensible purchases and sales.

Also that Broker's Fee could also be different for buying and selling. It may be less expensive to BUY and more expensive to SELL.

I don't know if this will work... But usually when you get a windfall of money, people around you expect you to doll-out more. Same with the Broker's Fee: when you SELL you MAKE money (hopefully) and have more money than you started with. This means that the Broker can charge you EXTRA in the Broker's Fee because you are pulling out of the Stock Market and making liquid monies... If you know what I mean.

I honestly think this would break your AI of SELL everything and BUY the cheapest stocks. But you'd have to test it out and establish parameters for the quantity of Stocks and the Cost of the Stock in to some simple math which would make it very hard to earn without choosing the stocks that you would WANT to hold-on to for when the stock rises.

Again I'm not sure it will work. But it gives you something to TRY out.

Cheers @larienna!

questccg
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Think about this...

The Admin Fee could be a flat rate per stock sold (to buy or sell) and can vary for say purchases or sales (sales higher) and include a percentage (%) which could be a composite value too. Say a (%) depending on the nature of the stock plus an amount which directly pays for the broker.

So [Admin fee] + [% stock class] + [% broker fee]

[Admin fee] = $0.50
[% stock class] = 2.5% to 5% (as an example)
[% broker fee] = flat 4%

This means the more transactions you have the more fees you have to pay.

All in all you're looking for a 10% fee (appx.) I'm pretty sure this will break your Dumb AI. Because that AI works on volume... The more transactions, the more money it loses. Meanwhile smart trades that require a trader to keep tabs on less stocks, will result in LESS fees and surely make for smarter decision making.

Again TRY it out... But I'm pretty sure if you use something like my formula, it will almost 100% break your Dumb AI.

questccg
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About the stock class

What I was trying to illustrate is penny stocks have a lower percentage (%) than blue chip which may have a higher percentage (%). Same goes for mining and so forth... That's where the Dumb AI gets further fuddled in that cheapest stocks may be less expensive but the margins they make vary less (mean)... So the market tendency is low = low income. High = higher risk but potentially more returns.

Something along those lines...

MarkD1733
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Blackout period

Is there a way to structure “blackout periods” for certain people. Each company could randomly have public information pending such that maybe some players are aligned with certain companies such that they cannot buy during these times. For example…maybe you draw from a bag a set of companies for this “round” they stay out so that other companies “blackout” next round. Throw in some “blanks” so that it’s never certain if companies will have blackouts or not.

larienna
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Some people suggested

Some people suggested transaction fees, it works well in real life or in a computer game, but in a board game it adds up a lot of bookeeping.

One idea I just have is that I could have fees for each stock owned at the end of the year. That would be a soft alternative to a limit in number of stocks. That would be the easiest way to handle fees. A flat rate per stock would prevent having a player stash a huge amount of low stocks and make a fortune when they raise in value. I was currently controlling this flaw by blocking purchases for stocks that are too low. But maybe a fee for each stock at the end of the year (each 4 turns) could be a solution. still players could sell all their stocks during the 4th turn to avoid the fees.

There is a random fluctuation mechanism by using cards. I could find a way that a certain amount of assets gets unlocked each turn. Although one thing I realised is that when people sell, they generally move money from one stock to another. If I only activate 3/8 stocks per turn, that means that only movement between those stocks are possible.

Another soft alternative is to have fees if you buy/sell locked stocks.

Does having blockout period makes sense?

questccg
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Fees will work to break the Dumb AI

larienna wrote:
...But maybe a fee for each stock at the end of the year (each 4 turns) could be a solution. still players could sell all their stocks during the 4th turn to avoid the fees...

The fees should be unavoidable. Always pay the FEE. This fixes the Dumb AI at it's core and makes that it cannot use the strategy of sell everything per turn and buy the maximum of the cheapest stock (again another FEE IMHO).

Don't make rules like on the 4th turn there is no FEE to sell or buy, etc. Keep it simple: always have a BUY FEE which is lower that a SELL FEE.

Again explaining that as you make more liquid monies, the more people expect you to pay higher fees. But when you buy, you are investing and have limit amount of monies to put in, so therefore lower fees!

You can simplify it too... Like $1.00 per stock bought or $2.00 per stock sold. I'm trying to use simple numbers that are easy to compute (1 and 2). Whatever the MATH in your game, this should be pretty simple to calculate...

I mean if you are trading stocks, there already needs to be an ABUNDANCE of math to make the game work, right???

larienna
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The problem with fees is like

The problem with fees is like saying that the stock is bought/sold more or less than the market price. So if your stock is worth 130$, the game has steps of 10$ and fees would be 10$, then it's like saying the stock is sold 120$, or that the real price is 140$ but it includes a 10$ fee.

On the other hand, I had another alternative to limit the max number of stocks. You could have a portfolio size. At the start of the year, you choose a size for your portfolio and you can never exceed that amount of stocks. On a new year, you can choose to increase or reduce your portfolio max size. The bigger your portfolio size, the more fees you pay at the end of the year.

This could be more interesting because there is a choice to be made in choosing the right size for your strategy.

That could make stock splitting tricky, I'll have to give it some thoughts.

questccg
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That is a good observation...

The: $140 = $130 + $10 is TRUE. But that can be $140 of ONE (1) Stock. TWO (2) stocks would cost $20... Three $30... So the SELL EVERYTHING and BUY THE CHEAPEST might NOT work...

I personally though a percentage like 10% would be better since it's easier to calculate than another percentage and is pro-rated to the value of the stock being sold or purchased.

IDK. I guess it still doesn't guarantee that the SELL ALL/BUY CHEAPEST AI might not still work. The idea is that it would only LIMIT the overall VALUE of the AI's portfolio.

Like if it has 10 stocks and pays $10 per stock = $100. Does the AI have enough monies to pay for the extra $100 in fees for SELLING or BUYING the stock. So it kinda CHOKES this ... But doesn't STOP it, it just makes it work less effectively I believe.

Can't be 100% sure... I was trying to EXPLOIT in the opposite direction the WHOLE "SELL ALL" making SELLING ALL EXPENSIVE to do. And then BUY ALL the CHEAPEST also EXPENSIVE (but less than selling)... Again not sure. I think in theory this would work but in practice, I'm again not sure.

Portfolio size makes a bit sense too... That too puts a HARD CAP LIMIT to the amount of various stocks available. And this kinda reminds me Mutual Funds and how they group together stocks from various holdings into ONE (1) TYPE of Funds that can be purchased like "Foreign Energy" or "Blue Chip Holding" or "Tech/Startup Companies", etc.

That might be good as another option. Who said you needed one over the other. It can be a multi-pronged solution: Fees + Portfolio size.

I think this is smart too... It makes sense to me! Best @larienna.

larienna
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Well fees are annoying to

Well fees are annoying to implement, but portfolio size seemed like an elegant way rather than blocking too low stocks.

Right now, the game prevents buying stock with a price lower than 50$. Else it makes the AI even more powerful since you can easily multiply the amount of stocks you have when you buy very low. For example, selling 1 100$ stock to buy a 20$ stock give you a 1:5 ratio.

Since the market naturally increase more than reduce (with the speculation mechanism), you will be able to easily sell it afterwards. Else I would need to remove the speculation mechanism which is designed to create sudden drops.

But with portfolio caps, it would prevent easy multiply of stocks or you'll need to pay a lot of fees to maintain that large portfolio. It could also be a way to better control the amount of denominations and components I need to supply with the game.

So I guess I'll try to try both mechanism: Portfolio size, and locked buying and selling. I will trying locking 5 to 3 stocks per turn.

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