The Daily Neopets → Neopets Articles → Stock Market Guide

Stock Market Guide

The stock market, when used properly, can earn you tons of neopoints with very little effort on your part. All it requires is a little bit of an investment, a little patience, and some luck.

Where can I find the Stock Market?

The Stock Market doesn't have a physical location on the map of Neopia, but you can reach it from Neopets by typing "stock" into the search bar on the Game Room page .

What is a Stock Market?

"Stock Market" is the name given to the process of buying and selling shares (also called stocks). Shares can basically be described as percentages of a business's' value. When the company is doing well and the shares are in demand, the price goes up. If the business is doing poorly, or if something happens to make the shareholders (owners of the shares) think the company will begin to do poorly, they tend to sell their shares. Therefore, there are more shares available with no one who wants to buy them and the price drops to encourage people to buy. In order to make money from the Stock Market in Neopets, just like in real life, you need to sell your shares at a higher price than you bought them.

How Does the Stock Market Work?

The first thing you will see at the top of the Stock Market page is a running line of letters and numbers:

While these may look complicated, they're rather quite simple. The four-letter codes are called Ticker Symbols and are simply abbreviations of the company's name. In the example above, for example, SKEI is the code for Skeith Feeding Ltd. Each company has its own unique ticker symbol. The number is what is most important. It is the current price of the stock. The colour tells you whether the price of the stock has gone up (green), gone down (red) or not changed (black) from what it was at the beginning of the day and by how much (price +/- change).

Buying Stocks

The first thing you need to know is that you can only purchase stocks that are selling at or over 15np each. Additionally, you can only buy a maximum of 1,000 stocks in one day (midnight NST- midnight NST). You can buy 1,000 of one stock, or mix and match different numbers of different stocks. There is no minimum. If you wanted to, you could just buy 1.

To buy a stock, you can either click on the ticker symbol as it scrolls across the top of the page, use the Find Stocks in the page menu, or click on an existing stock in your portfolio to purchase more of a stock you already have.

Upon clicking a ticker symbol, you are directed to a page that looks like this:

Click to enlarge

In the real stock market, competitors affect a company's stock. Competitors are businesses that are similar to the company. They may provide a similar service or sell a similar product. If they are doing well, customers that could be coming to you are going to your competitor and your company is not worth as much as it could be if you had all the business. In the Neopets stock market, the price of your competitor's stock has no effect on your stock.

Clicking on the company name brings you to the page where you can actually buy the stock:

Remember, you can buy as few as 1 stock from a company or as many as 1,000 in one day. We will talk more about buying strategies later.

Your Portfolio

Your Portfolio shows all the stocks you currently own:

For each of your stocks, it shows:

the logo
ticker symbol
the price of the stock at the beginning of the day
what the price is currently
how much the price has changed since of the beginning of the day
how much you paid for all your stocks from the company
how much they would be worth if you sold all of them immediately
the percentage you would lose/profit if you sold immediately

How to Sell

To sell stocks, click the arrow to the left of the logo and type in how many of the stock you want to sell. To sell shares from multiple companies at once, do the same for all the companies whose stock you want to sell and click "sell shares" at the bottom of your portfolio. Each time you sell shares, Nigel, your accountant, takes a 20np fee from your income, no matter how many shares you sell. Because of this, it is better to sell all the stocks you want to at once. Unlike buying, there is no limit to how many stocks you can sell in a day. You can sell 1 or all of your shares at once.

How Does the Stock Market Make Money?

In order to make a profit from the stock market, you must sell the stock for more than you purchased it for. If you buy a stock for 15np, for example, then sell it when it reaches 30np, you make 15 np from that one stock. Your profit depends on how much you bought the stocks for, how much you sold them for and how many you bought. In the example above, if you had bought and sold 1,000 stocks at those prices, you would have made 15,000 np.

Deciding When, What and How Many to Buy

People use different buying strategies depending on their playing style. One thing almost everyone agrees on for maximum profit is that you shouldn't buy stocks when the prices are high. Generally, buying stocks between 15np and 20np is a good method because it allows the most room for profit. What you buy follows this same principle. Unlike in real life, stock prices are completely random (or determined by a formula only known to TNT). You want to be buying according to the price of the stock more than any other factor.

How many stocks to buy is a matter of personal preference. The more you buy, as illustrated above, the more profit you can make, but it also requires more of an initial investment. One common method is to buy the maximum daily stocks (1,000) of one company every day, usually a company whose stocks are at 15np (the minumum price to be able to buy). If there is more than one company selling at 15np, you can choose just one, or split up your 1,000 purchases between them. To find the cheapest stocks, you can take a look at the Bargain Stocks Page . When you buy in groups of 1,000, you earn 1,000np for every point the stock goes over what you paid.

When and How Many to Sell

Selling is, again, a matter of personal preference. To make a profit, you want to sell when your stock is worth more than you paid for it. However, you need to be careful. A stock you bought at 15np could be worth 40np one day, but then drop to 20np or less over the course of the day. You are taking a risk every time you sell. The prices are always changing. If you wait too long, a price that was high may drop significantly for a long time. Similarly, if you sell too soon, the prices could rise and you would loose the additional profit you would have made had you waited. Some people sell when their stocks hit a certain price, some just sell when they are happy with the amount of profit they will make from the sale. Just remember, there is a fee every time you sell any stocks. Whether you sell one stock from one company or 5,000 stocks from 18 different companies, the fee will always be 20np.

Strategies

There are many different strategies people use when playing the market.

Keep track of what you buy. It may seem silly to write down or keep a document on your computer with all your stock information because the quantities and prices are in your portfolio. However, knowing some or all of your stock information can be useful in sending tickets to TNT about your account. If you ever need to request your birthday information or request to unfreeze your account (if it was frozen for your protection or you had self-frozen for whatever reason), stock info is one of the ways you can prove yourself to be the owner of the account.

Set a Selling Point. Many people consistently sell their stocks when they reach a certain price point. They may sell when the value of the stock has doubled (100% change), reached a certain value (34np or 42np or 56np, whatever amount you'd like), or at a set percentage of profit (80% change, for example). Deciding on a consistent selling point keeps you from taking too many (possibly) expensive risks.

Splitting Stock.This method is not much different than the above method. It involves setting a set price to sell at, but then only selling half of your stock when it hits that point. You can then choose to either ride out the trend and wait until the price rises a little more before selling, or set another fixed price to sell at. Even better, set two prices initially that you will use consistently, one price to sell half the stock and another higher price to sell the rest. This method allows you to take advantage of a bigger possible profit if the market continues to rise after your first sell point, but also offers some insurance if the price begins to drop. You still made a good profit on half your stock, more than you would have if you hadn't sold half and held on to all of it waiting for a price increase that never came.

Build Company Profiles Equally. As you will see below, investing in a variety of companies is a good idea. One way to keep your profile balanced is to limit your stock purchases from the same company. Decide first how many companies you would like to invest in. Even 5-10 is good for a beginner. Then, buy rotating "lots" of stock from these companies in stages. For example, I've decided to invest in BB, BOTT, CHIA, COFL and CYBU. The first day I buy 500 stocks in BB. The next day, 500 in BOTT. The next day, 500 in CHIA, and so on. I don't buy any from the same company until I have 500 stocks from each company. Then I can start over buying 500 from each every day. This ensures an equal opportunity for profit in all your stocks. You can do this with any number. You may choose to buy 10 stock/day, 100, or 1,000. Just remember, the price is per stock. So if a stock is selling at 22np, buying 1,000 will cost 22,000np as opposed to buying 10 for 220np.

Only Buy at 15. This is a method many people use. They will only buy stock that is selling at 15np (the minimum for purchse). The prices refresh throughout the day, so if there are no companies selling at 15np when you first check, come back a few times throughout the day and you're almost guaranteed to find one. The only drawback to this method is that prices can stay consistant for awhile. This may mean the same 4 or 5 stocks are always at 15np and, if you're also trying to diversify your portfolio, this could be a bit of a problem. To combat this, you could use the "equal building" method above. If, for example, CHIA and CYBU are both selling at 15np and in your portfolio you already have 20,000 shares of CHIA but only 2,000 of CYBU, you should invest in CYBU that day.

Tips

Invest in a variety of companies. Having 60,000 stocks in one company doesn't do you any good if the price of the stock has been less than you paid for months (or even years). Investing in a number of different stocks makes it more likely that at least one of your stocks will be "in the green" (worth more than you paid for it). This is handy if you need some quick money. You can sell a stock that's in the green. Though you may not make as much as you had hoped, you're not losing any money by selling stocks for less than you paid for them. This also protects you if one of your stocks goes bankrupt. Though this is much rarer than it used to be, it can happen. When a stock loses all its value and its price drops to 0, it is "bankrupt." The price will never rise once it hits 0. The method of having stocks from many different companies is called diversifying your portfolio.

Sell in large numbers. If you want to sell a lot of stocks in one day, selling them all at one time ensures you only pay the 20np fee once. Additionally, if you're only selling one or two stocks, the cost to sell them may be more than the profit you get from them.

Do some research There are different petpages and sites dedicated to tracking trends in the Neopian stock market. A quick search can show you typical prices for different company's stocks and even trends over weeks, months, or years. Some rarely reach over 30np, while it is not uncommon for some to reach 60np, 100np or more. This information can help you determine what to buy and when to sell.

Be Patient!. The stock market is a waiting game. Your stock may be stuck between 15np and 17np (or even less) for weeks or months, then increase to 30np or 40np in a couple of days. For maximum profits, you need to be willing to wait.

Avatar!

To get the avatar, you must have at least 1 million neopoints invested in stocks and view your portfolio. The investment is the total you paid for all your stocks, not what they are currently worth. You can see your total investment so far by looking at bottom of the "paid" column in your portfolio. You can wait until your daily investments add up enough to get the avatar, or, if you don't want to wait, you can buy a lot of high priced stocks over a few days to get to the total faster. However, when buying a lot of extremely high-priced stocks, there is always the chance the price will drop suddenly and you will lose money, so do so at your own risk.