Grand Exchange

The Grand Exchange (GE) is a trading system for everyone to buy and sell from each other almost every tradeable item (currently 6,032 items). Traders don't need to advertise, meet each other, or even wait at the GE for their trades to finish. All coins and items from fully and partly finished trades are collectible at any bank (but not at bank chests or deposit boxes). This trading system resembles a real-life computerized commodity market where all transfers are done by computer. It is extremely efficient.

The GE also refers to the location of this trading system, which is an official marketplace northwest of Varrock city. It was released on 26 November 2007 and has since replaced the older marketplaces in Varrock and Falador cities. It is also a popular safespot on pvp worlds.

Finding the GE


The GE is located northwest of Varrock. It has six different entrances:


 * Walking from Varrock city.
 * Using the tunnel northwest of the GE. (Requires membership and level 21 agility.)
 * Using the mine cart northwest of the GE. (Requires membership and having started the quest The Giant Dwarf.)
 * Using the spirit tree northeast of the GE. (Requires membership and having completed the quest Tree Gnome Village.)
 * Using the fairy ring with the code "DKR." (Requires membership and having access to the fairy rings from the quest Fairy Tale Part II.)
 * Using the spell Varrock Teleport after changing its destination to south of the GE. (Requires membership and having completed one Varrock Achievement Diary.)

NPC Informants


Around the GE are five characters who shows the current prices of various items.


 * Farid Morrisane shows the prices of ores.
 * Relobo Blinyo shows the prices of logs.
 * Bob Barter shows the prices of herbs. He also decants potions into full and empty vials.
 * Murky Matt shows the prices of runes. He also "decants" charged items into full and empty charges.
 * Hofuthand shows the prices of certain weapons and armours. (See picture for details.)

Item sets
Most armours and the Dwarf multicannon can be assembled into sets to save space. They behave like ordinary items except they are unusable until they are disassembled. Only the GE clerks can assemble and disassemble sets, and they will do it for free. Right-clicking a set and selecting destroy will not disassemble it, although its destruction will bring a smile to Zamorak's face (unless if it's his own, of course).

Pricing
Prices are partly governed by the Law of Supply and Demand:


 * If an item is in high demand with low supply, then its price will increase.
 * If an item is in low demand with high supply, then its price will decrease.
 * If an item's demand matches its supply, then its price will remain constant.

Jagex has never published the GE's exact pricing algorithms, although we do have some reasonable guesses. By using the law of supply and demand, the prices of items are updated depending on its recently traded prices and volume. For items with low volume such as party hats, their prices update every few days or even once a week. Jagex can also intervene and set the prices themselves, and they reserve the right to intervene when they believe price manipulation is going on.

Prices are also partly governed by trade restrictions (see section Trade Restrictions below for details).

Trading Tips

 * For the runescape Wiki price guide, see GE Price Guide.


 * World 1 and 2 are popular worlds for trading items without using the GE, especially items such as party hats.
 * All offers outside the ±5% price range are inactive, so check your offers occasionally.
 * Competing offers are prioritized chronologically, so consider making your offers early.
 * All offers are completed using the earlier offer's price. In other words, when the buyer's price is above the seller's price, the trade is completed using the earlier offer's price, so also consider making your offers later.


 * To bargain, you can wait to see whether your offer is accepted and then change your price accordingly.


 * To wait efficiently, you can make fires, cook, alchemise, superheat, chat with friends or surf forums while waiting.
 * When a new account sells its first item on the GE, the item is instantly converted to coins.
 * Price manipulation is possible even with the GE, so be careful. (See section Price Manipulation below for details.)

Trade Restrictions
All trade restrictions are intended to reduce price manipulation, real-world trading, and/or unfair interactions between players with different levels. On the issue of price manipulation, Jagex said, "We are keen to keep a player-driven economy, so the prices are worked out using the supply and demand rules above. We will only intervene as a last resort, and only if we think price manipulation is going on, although the system has lots of safeguards to prevent that." Trade restrictions are those safeguards.

Absolute prices: ceilings & floors
Some items have a maximum and minimum permissible price. The maximum permissible price is called a ceiling, and the minimum permissible price is called a floor. Spirit shard has a fixed price, which means it has an identical ceiling and floor.

This trade restriction is intended to reduce price manipulation and unfair interactions between players with different levels. Some examples:.


 * Economic cooperation often favors players with lower levels, at least more so than Jagex intended. As an example, wine-making is a very fast way to gain cooking experience, and so some high-level players used to pay 100 coins for each jug of water. This means low-level players could fill the empty jugs and sell them for at most 246,000 coins per hour. After one hour at the water pump a newbie could've easily buy full rune armours. Ceilings and floors reduce this sort of unfair cooperation.
 * Economic competition often favors players with higher levels. And so items used by various levels often have prices beyond the lower level players' budget. As an example, a level 9 mage needs about 102 coins to cast one earth strike, which is often too expensive for them. Ceilings and floors reduce this sort of unbalanced competition.
 * Popular alchemiseable items often have floors slightly above the coins generated by high alchemy, which discourages easy magic leveling.

Sadly, the ceilings undervalue some items and the floors overvalue some items. (Overvalued items are also called junk items.) To balance their street values, they must be traded for each other using the slow player-to-player trades.

Jagex has never published a list of items displaying their ceilings and floors, although Jagex has a stickied thread on its forum for everyone to offer suggestions about new ceilings and floors for specific items. 

Relative prices: ±5% limit
Jagex uses a restriction on the permissible price range to slow the volatility of the market. It means the market responses slower to large changes in price.


 * 1) All items' prices are restricted to ±5% of their current market price. If an item's market price is 100, then its price range is between 95 and 105. All offers outside the ±5% range are inactive, so check your offers occasionally and update them as needed.
 * 2) If a ceiling or floor is within the ±5% range, then the ceiling or floor has priority.

Buying & selling rates

 * 1) If someone buys something through the GE, then he or she cannot sell it until 4 hours later.
 * 2) Buying rate is restricted to n quantity every 4 hours. The exact quantity for each item is shown below:
 * * Items in the same set share the same restriction, i.e. maximum of 51 bronze platebodies and 49 bronze platelegs every 4 hours. This includes treasure trail sets.


 * ** Slayer items including abyssal whip, amulets of ranging, black masks, brine sabres, draconic visages, dark bow, focus sight, granite items, hexcrests, staves of light, metal boots, and some more.

Tradeable items that cannot be traded using the GE
Some items cannot be traded using the GE, but they can still be traded using the traditional player-to-player trade. The list includes:


 * Burnt foods.
 * Items from the quest Shield of Arrav: half certificate, phoenix crossbow, and weapon store key.
 * Items from the quest Heroes' Quest: miscellaneous key and Pete's Candlestick.
 * Most items from the shopkeeper Faruq in Al-Kharid: magic skullballs, marker seeds, and voting hat. [This list is incomplete.]
 * Ogleroot from the mini-game Vinesweeper.
 * Cursed magic logs from the Spirit Realm.
 * Ancient artefacts from PvP Worlds and Bounty Worlds.
 * Partially charged items: amulet of glory (1-3), games necklace (2-7), and black masks (1-9). Remember that Murky Matt can transfer charges around to make full and empty charged items.
 * Gnomeball

The GE replaces genuine merchants
The GE has made genuine merchants almost obsolete. The list below outlines the only legitimate role of every genuine merchant, and then shows that the GE has fulfilled this role almost perfectly—far better than every human merchant.
 * 1) All genuine merchants have exactly one legitimate role: to decrease the overall transaction cost.
 * 2) Transaction cost is the cost of finding someone to trade with, bargaining and enforcing a trade agreement, and transferring the agreed goods and/or services.
 * 3) The GE finds someone to trade for us. It searches every offer, always and every world.
 * 4) The GE bargains for us. If the buyer bids higher or equal to the seller’s asking price, then the GE instantly completes the trade. If not, then it doesn’t—but in this case genuine merchants cannot profit anyway. Because if the buyer bids lower than the seller’s asking price, then genuine merchants cannot profit by buying from the seller at some price and later selling to the buyer at a lower price. Also, we can bargain using the GE by waiting to see whether an offer is accepted and then changing our price accordingly. While waiting to see whether an offer is accepted, we can make fires, cook, alchemise, or superheat to pass time. It means only a tiny amount of time is used purely for bargaining.
 * 5) The GE enforces trade agreements for us. It guarantees that each person keeps his or her end of the bargain.
 * 6) The GE transfers the items halfway for us. We still have to bring the items to the marketplace, but the GE brings the items from the marketplace to our collection box. We can collect them at any bank, and all we had to do was teleport to Varrock and run to the GE once.
 * 7) In summary of 1 through 6, the GE has made genuine merchants almost obsolete.

Price manipulation
Every price manipulation uses deception and/or coercion, which is why it is wrong to intentionally manipulate prices. Price manipulation is generally considered to have two main types and several subtypes; they are categorized differently because they work somewhat differently. (The fact that they work somewhat differently is why more than one solution is needed.) The two main types are disclosure-based manipulation and trade-based manipulation.

Disclosure-based manipulation
"This occurs where a person [discloses] false or misleading information which has the effect of misleading other participants about the value or trading volume of a security." (Every tradeable item in RuneScape is a security.) Disclosure-based manipulation is fraud.

Pyramid scam
How some merchant clan leaders are using a pyramid scam on people, in five steps:
 * 1) Some merchant clan leaders secretly buy lots and lots of the same item.
 * 2) They recruit and mislead people into buying the same item at a higher price, thus raising the item's price.
 * 3) They encourage people to recruit even more people, thus creating a pyramid.
 * 4) They set a "dump price" for everyone to sell.
 * 5) They either secretly sell their item before this dump price is reached, or they suddenly announce a new dump price; in both cases many people are still buying the item. What these people are misled into buying is the item they are secretly or suddenly dumping.


 * Steps 2 through 5 overlap considerably.

Trade-based manipulation
"This is the buying or selling of a security by a person [or group] which misleads or deceives other participants about the value or trading volume of that security.” It has many subtypes, but only two significantly damage the runescape economy: matched orders and corners.

Matched orders, pools, and wash sales
Someone places an order to buy, and matches it with an order to sell: the buyer and seller are the same person. This transaction is fake because nothing is really being transferred. Matched orders manipulate prices by faking a supply and demand. A group can do this too.

Matched orders also mislead other people into overestimating the trading activities of the security that’s being manipulated, and thus—for slightly technical reasons—mislead them into underestimating the transaction cost of that security.

Matched orders and genuine orders are currently nearly impossible to differentiate on runescape. We can only imagine account#1 posting an order to buy a dragon pickaxe for an unusual price, and account#2 selling it for a similarly unusual price. Repeated enough times and the price isn’t so unusual anymore, and that’s when the manipulation succeeded. We can also only imagine 2 millions lobsters being bought and sold for the same price on the GE, and so the GE accounts for those numbers when it updates the price of lobsters, but the GE currently doesn’t know whether the buyers and sellers were the same person. We don’t either. Again, matched orders and genuine orders are currently nearly impossible to differentiate on runescape.

Corners or squeezes
Someone buys something, raises its price, and then sells it to another person. In this transaction, a cornering merchant intends to raise price by merely monopolizing his or her competitors, whereas a genuine merchant intends to raise price by at least decreasing the overall transaction cost. (Transaction cost is the cost of conducting a trade: the time and effort of finding someone to trade with, bargaining and enforcing a trade agreement, and transferring the goods and/or services.) Corners manipulate prices by monopolizing a security in a way that increases its overall transaction cost, and this additional transaction cost burdens other buyers but not the manipulator. Again, a group can do this too.

The New Zealand government defines corner this way: A corner is where “a person [or group] buys up a substantial volume of a security knowing that other market participants will be forced to buy from him at a higher price.”. Other buyers are forced to buy from a cornering merchant because they are left with few alternatives—the manipulator had already monopolized his competitors. By contrast, other buyers are not forced to buy from a genuine merchant because of two reasons: first, a genuine merchant often has competitors or the threat of potential competitors; second and most importantly, a genuine merchant saves them some trouble of finding someone to trade with, bargaining and enforcing a trade agreement, and transferring the goods and/or services.

Implementing the GE
The GE was released on 26 November 2007. Before the GE, Jagex had several legal issues with "real-world trading organisations." These organisations use bots and/or RWT labor to harvest raw materials, and then either sell the raw materials to NPC shops or amass them in a "farm system." Their virtual wealth is then traded to players for real-world money. These organisations operated on both free and member worlds, and Jagex claims that their member accounts were often using stolen credit cards. The payments from stolen credit cards sometimes had to be refunded, in which case Jagex lost money.

The GE was implemented alongside with a restriction on player-to-player trades which restricted net wealth transfers to 3,000 coins. The restriction was intended to weaken real-world traders and every type of price manipulation, but it also harmed genuine merchants and other honest players. Players complained and so Jagex to gradually relaxed the restriction to its current level, which is 5,000 for zero quest points; 10,000 maximum for free players; and 60,000 maximum for members. On 1 February 2010, the trade limit was updated. Friends with each other's names on the friends list for over 1 month will have their trade limit doubled when trading with each other, tripled if over 2 months, and quadrupled if over 3 months.

The GE was also implemented alongside a staking limit in order to stop real world trading via staking.

Initial economic effects
Genuine merchant activities were previously some of the most profitable methods of earning coins, but the GE has made genuine merchants almost obsolete. This means all items' transaction costs had greatly decreased, and in turn, most items' prices had decreased: Rune equipments' prices dropped significantly after a few months. Items traded on both free and members worlds were averaged by the GE. For example, cooked lobsters were traded for 250 coins in free worlds but 200 coins in member worlds, and so the GE price was 220. Discontinued items, especially party hats and Christmas cracker, were primarily used in staking and so their prices dropped significantly after the removal of staking. A few items' prices, however, increased after the GE's release. For example, bones were previously not worth the effort to collect and trade, but then their prices quickly increased to about 100 coins.
 * Cooked Shark: 800 to 1700 coins.
 * Cooked lobster: 650 to 220 coins.
 * Rune battleaxe: 40,000 to 25,000 coins.
 * Rune scimitar: 25,000 to 35,000 coins (but later decreased to 30,000 when PVP was re-added into the game).
 * Rune platebody: 55,000 to 71,000 coins (but later decreased to 55,000 when PVP was re-added into the game).
 * Dragon hatchet: 2.7 million to 2.0 million coins.
 * Abyssal whip 1.3 million to 3.7 million coins.

On 10 December 2007, a series of updates eliminated macros, which were a major source of raw materials. As a result, prices for raw materials previously gathered by macros, such as yew logs and raw lobsters, increased to a higher level than their pre-GE level. Yew logs increased from about 350 coins during pre-GE days to about 450 coins post-GE. Raw fishes are now worth more than cooked ones, except for manta rays and sea turtles because they can still burn even with maximum cooking level. The prices of raw and cooked fishes are now generally similar to their prices several years ago when macros were not a major problem.

Players' initial reactions
Most players embraced the release of the GE because it greatly reduced their transaction costs (see above section "GE replacing genuine merchants"). Some players, however, criticized the trade restrictions, especially the ±5% trade restriction and the player-to-player trade restriction. Other players criticized Jagex's lack of transparency because Jagex has neither published the GE's pricing algorithms nor the price ceiling and floor of each item.

Some players view the GE as a form of totalitarianism, a political system in which a central authority controls the economy and culture. This claim is largely without fact however, as most of Jagex's actions mirror that of Keynesianism, in the use of government intervention to decrease inflation or recession. The economy is driven by players, but many times Jagex has intervened by raising the prices of items that were significantly below their high alchemy prices, and by correlating the prices of similar items despite the fact almost all players priced them differently. For example, empty jug and jug of water have identical prices, and full potions and partial potions have proportionate prices. Jagex's interventions have discouraged players from using high alchemy to effortlessly train magic, and since high alchemy was a major source of coins, the lack of coins from high alchemy contributed to a deflation called the 2008 Market Dip.

The 2008 Market Dip
In August 2008, the prices of numerous expensive items—godswords, barrows armours, abyssal whip, and high-level treasure trails armours—began to decrease for various reasons. This led to a collective social problem. The players, as individuals, reacted rationally by selling those items to prevent further personal losses, which collectively caused those items' prices to drop further and thus worsening the deflation. By 4 September, prices reached a plateau for most items and even started to rise for some items. By 31 October the market dip was over, although some expensive items were still millions of coins below their prices in August.

Trivial Information

 * When the Grand Exchange was made public, many players were angry that the prices were set unfairly, since the "old style" of selling valuable items required much more time and effort.
 * The maximum offer is 2,147,483,647 coins or simply 231−1 coins. This is the maximum value of the Java  type in 32 bits.


 * 26 Nov '07. Release date of the GE. Various NPCs across runescape were talking like the GE clerks. Withdrawing offers and items in the collection box was impossible because the items were stored on an older system which wasn't synchronizing with the GE's system. Many items had market prices enormously lower than their street prices, i.e. pirate's hat at 127 coins and gnome scarf at 1,284 coins.
 * Searching for "Andrew Gower" in the search box used to display a smiley face. But now it smiles no more.
 * Standing adjacent the GE desk and using a bowstring with an already strung yew longbow used to create a message in our chat box: "You can't light a fire here."
 * 1 July '08. The HD graphical update prevented the progress bar of some players' trade offer from changing colour whenever the offer was completed or cancelled. This was fixed after the RuneTek 5 engine update.
 * 11 Nov '08. Release date of Stealing Creation. The sacred clay arrows were listed on the GE even though they cannot exist outside the mini-game.
 * 9 June '09. A bug muted the GE bankers and clerks, but players could still access the GE through the desk.
 * 26 Aug '09. Items are now collectible as notes: simply right-click them while they're in the collection box.
 * 17 Sept '09. Two bankers and two clerks were fired by Mod Alan because the multiple bankers and clerks created redundant right-click options. The layoff caused a bug where all bankers across runescape couldn't talk to the players, although right-clicking the bankers' desk allow players the option to use quickly. The bug was actually the bankers' union protesting the layoff of their union members. It lasted several months.
 * 8 Nov '09. A bug in World 2 caused the GE bankers and clerks to vanish for several minutes.Grand_Exchange_Seren.png
 * 10 Nov '09. The desk now only has the examine option.


 * All clerks' desks have the symbol of Seren the elven goddess. It is worth examining.
 * 08 Feb '10. A bug disabled the entire GE except for the search box. Predictably, there were riots across runescape and rants on the official forums. A similar bug occurred on 10 Apr '10.