Investment Bank - mutual/hedge funds


#1

How to start mutual or hedge fund with investment bank? Thank you

EDIT: Also, does investment bank gets 1% brokerage fee when stocks or bonds it issued are traded on secondary market or does that money dissapear from game? Could we actually make all money dissapear by trading all the time? (lol, stupid question I know)


#2

The investment bank only gets the commission on IPO or bond listing. The 1% disappears so yes in theory you could trade away all the cash - highly unlikely I think.


#3

It would really be cool if banks got that 1%. In RL every investment bank has brokerage division that makes money when its clients are buying and selling stocks on secondary market. The way game is structured currently, players soon get so big that they will never ever need cash again, so investment bank basically has option only to make money from player once or twice, during bond and stock issues early in life of holding company.


#4

I would love to see a player start a MUTUAL or HEDGE FUND. This is actually noted in the User Guide (copy below).

  • You would make your money by charging a fund administration fee to the other players that give you their money to manage. (This fee is sometimes called a “Load Fee” when managing mutual funds).

  • You could use a shared Google spreadsheet to keep track of your fund investments and share that with other players.

  • Fireyscorp is right about how the underwriter fee works. An underwriter fee is not the same as a brokerage fee. Underwriter fee collected by an Investment Bank only applies to share issues on the PRIMARY market. Shares traded on the SECONDARY market have a brokerage fee charged by GoVenture World (not other players.).

  • As the game gets bigger and more players are in, there will be more opportunity for an Investment Bank to make money. And we will build more ways to spend money at some point too.

From User Guide: https://goventureworld.com/user-guide.html#investment-bank
Manage Mutual Funds and Hedge Funds
An Investment Bank, through its Holding Company, can purchase stocks and bonds just like any other business. It can also raise money from other players. This allows an Investment Bank to create its own mutual funds or act as a hedge fund and invest on behalf of other players, by conducting due diligence, negotiating investments, and tracking and reporting performance. These tasks are done manually by the player that owns the Investment Bank. See Investment Portfolio for more details.


#5

Wow. that’s something I can try to do with my new bank!! needs more liquidity in the market which would probably need the option to sit a buy order in the market.


#6

For start, it would be very cool if we could also place buy orders, to make orderbooks for each company instead of listing like on craig’s list.

So each company would have its own order book with buy and sell orders stacked up on each side, without knowing who is buyer or seller. Just like real stock exchange with bids and asks. It would take some programming though.


#7

Yes, we are considering having BUY and SELL orders for the markets. But it will take us a while to get there.