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The ERX Tutorial:

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I. Introduction
   A. The Basics of Stocks
   B. Risks, Benefits, and the SEC

II. The ERX Website
   C. Registering
   D. Preparing To Invest
   E. Corporation Page
   F. Sealing the Deal: Buying and Selling
   G. Managing Your Portfolio  

A. The Basics of Stocks

• Before you can invest wisely, you need to know how a stock exchange works. Normally, a company owner decides to “go public” with his company by releasing an Initial Public Offering (IPO). He will sell small slivers of ownership to buyers for a price. Each of these slivers are called shares. The more shares you own, the more ownership you possess in the company. The owner then can either reinvest the money generated by selling the ownership, or he can walk away with it.  
  
  Either way, you, the consumer, now own part of the company you bought shares from. As a partial owner, you are entitled to the company's profits—in proportion to how much of the company you own. These profits are called dividends. This is one way to profit from the ownership of stocks.  
  
  The other way to profit from stocks is to sell them for more than you bought them for. If a company has increased their profits from the time you bought the stocks, you can generally sell them to another person for more than you paid. The person buying the stocks is betting that you're wrong. They think the profits will continue to increase—thus increasing the dividends—and that they can also sell the stocks to someone else for even more money.
  
  Unlike the real stock exchanges, the ERX trades stock on corporations, not individual raw material, manufacturing, or construction companies. For the remainder of the guide, corporation refers to the entity that is being invested in, while company refers to one of the corporation's assets.   

  

B. Risks, Benefits, and the SEC

• As a partial owner of an corporation, you're agreeing to live the life of an entrepreneur. This means that you're accepting the risk of failure (bankruptcy) in exchange for a chance to make more money. The business owners, meanwhile, make money off of their IPO which they can re-invest in their companies to strengthen it further. In this respect, stock exchanges are win-wins for investors and business owners. Still, combinations of mismanagement, bad luck, and unforeseen events mean that no company is guaranteed to succeed.  
  
  The eRep Stock Exchange does keep a cash reserve to help protect investors against a total loss of their investment should the corporation they own go bankrupt. You will not receive all of your money back, but it can help soften the blow of your stock's value crashing.  
  
  Another risk of the eRepublik Exchange is the potential fraud. corporation owners can willfully misreport their earnings, assets, and projections to artificially inflate their stock's price. The eRep Exchange helps prevent this by distinguishing between audited and non-audited corporations. Audited companies are required to submit various forms of information that certify the accuracy of the corporation's reporting, while non-audited corporations are not. eUS' Securities and Exchange Commission help the auditing process and is the body responsible for correcting any fraud. It is strongly recommended that you only purchase stock from audited corporations.  
  
  Don't let all of these risks scare you. They are all possibilities, but the organizers of the eRepublik Exchange have done everything in their power to prevent these from happening. For most people, the risk is well worth the potential benefit. If you cannot stand the idea of ever losing money, the eRep Exchange is not for you. Otherwise, let's get started with how to make some big bucks!  

C. Registering

• Let's get started! Click here to go to the eRep Exchange. Bookmark it. You'll need to refer to it frequently to maximize your profits. If you haven't registered, you should see a line graph and some reasons why the eRep Exchange is awesome. The line graph tracks the amount of gold invested in all the stocks on the exchange over time.To register an account with the eRep Exchange, click on the “Register” button in the bottom left hand corner. Then click “Get Started”. This will take you a screen that says “eRepublik API”. Insert you eRepublik username in password. This is okay! The url: http://api.erepublik.com proves that this is actually a legitimate eRepulik website. By logging into the API, you securely confirm to eRepublik and the eRep Exchange that you do have control over the character you're registering. Never give out your name and password to any site besides www.erepublik.com or http://api.erepublik.com.  
  
  Once this step has completed, enter a secure password. Like your eRepublik password, it should have numbers and letters and should include any complete words that a program might try from a predefined word list. Also, it should not be identical to your eRepublik password.   

  

D. Preparing to Invest

• Okay! Now let's get some money to invest with. This is best done before you even know what stock you want to buy, because the process of transferring gold from your citizen's account to the eRepublik Stock exchange can take up to 24 hours. In order to transfer money from your citizen account to your ERX account, simply donate the gold from your citizen account to the ERX Terminal account. Do not donate your gold to any other corporation claiming to be related to the ERX.  
  
  Once the money has been transferred to your ERX account, the amount transferred will appear in the bottom left hand corner of every ERX page, assuming you are logged in. By default, you'll be taken to the “Your Portfolio” tab, which should be empty at this point.  
  
  Let's go buy some stocks and make ourselves a portfolio! Click the “All Stocks” tab at the top of the ERX page. By default, you'll be viewing only audited stocks. This is the recommended viewing setting for beginning investors and those looking for safer bets.    
  
  On this page, there are 9 columns for each corporation. Let's go through the columns one by one. First, we have the full corporation name, with the abbreviation of the org in the next column. The abbreviation allows for quick concise identification of stocks. The next column is the ever-important share value. This indicates how much you'll pay to own one share of the company. Next are change and volume. Change is the percentage change in value of one share of the stock over the last 24 hours, while volume indicates how many shares exchanged hands over the last 24 hours. This information combined gives you an idea of what direction a stock is trending and how quickly it's doing so.  
  
  Org Value is an important indicator as well. This is the total value of the corporation's assets, as measured by the ERX guidelines. The guidelines dictate that an corporation's value is based on the number of companies owned proportionate to the quality of the company. The following valuation rubric is used:  
  
  

  Company Quality:	Net Worth to Org:
  Q1	20
  Q2	40
  Q3	90
  Q4	190
  Q5	390

   
  Corporation value is generally a good indicator of the corporation's track-record and stability. The higher the value, the more likely they are to be stable. This is partially due to the fact that higher quality companies tend to be more profitable and also partially due to the fact that corporations with higher values tend to have more resources to weather difficult economic times. On the other hand, smaller companies that are well run have a greater potential to grow rapidly, increasing the value of your shares more quickly.  
  
  Country indicates the corporation's country of origin, while the listed column indicates the date of initial public offering of shares on the ERX.

   

E. Corporation Page

• These columns are just cursory glances at a corporation's background. For more information, click on any corporation's name in the left-hand most column. This will take you to the corporation's detailed page, which exposes you to a greater wealth of data.  
  
  Immediately below the corporation's name in the upper left hand corner of the page are three numbers. The large, blue number is the current value of one share. Immediately below it is  a number to the left which indicates the change in the value of a share in raw gold. To the right of  this number is the percentage change in the stock's value.  
  
  To the right of these numbers are three crucial numbers: organisation value, total shares, and market cap. We've already discussed org value. Total shares indicates the number of shares that could possibly be owned. This number is important because dividends are divided equally amongst the shares, and it is also used to determine the market cap. The market cap, determined by the number of shares multiplied by the price per share, is a good indicator of whether an corporation has overvalued shares. If the market cap exceeds the estimated org value, then chances are that the shares are overvalued.  
  
  Moving further right, we find historical data that can help you get a sense of an corporation's highs and lows. The best tool for this, however, is the line graph in the center of your page. The dropdown box in the upper right portion of the screen allows you select your range of data.  
  
  Don't ignore the Current Market Offers and Latest News sections either! Current Market Offers indicates the current lowest price of shares for sale (Ask: xx) and the current highest price that a buyer is willing to pay (Bid: xx). Latest news is also a good place to check the corporation's previous dividends and upcoming events.  
  
  It's not a bad idea to just browse through the audited stocks, but if you know a specific corporation you'd like to invest in, there is always the search field in the bottom right hand corner of every page.    

F. Sealing the Deal: Buying and Selling

• After browsing through a number of stocks, pick out one corporation you'd like to invest it. You may purchase stock one of several ways. You can go to the “Place Order” tab at the top of any ERX page, you can go to “All Stocks” and click the sell link on the far right of any corporation's name, or click the “Buy Shares” button in the upper right hand corner of each corporation detail's page. No matter which way you choose, you end up in the same place.  
  
  First, find the corporation you want to buy stock in from the drop down menu. Set your quantity and your highest maximum bid per share. The handy calculator will indicate how much total gold will be withdrawn from your account upon a successful transaction. Last but not least, be sure to review an order expiration time. If you're bound and determined to buy the stock at a cheap price, then you may want to lengthen the expiration time.    
  
  It's also important to note that the ERX charges a 1% transaction fee on all transactions. This fee helps pay the employees who run the site as well as the set-up costs involved in creating such a massive undertaking.   
  
  This same set up will be used for selling stocks, with the exception that you make sure that the radio button in at the top of the form is selected to “Sell”. It is important to note that posting an offer to sell shares, or for that matter an offer to buy shares is just that--an offer. Someone else must want to exchange as well. So, for example, if you post a sell offer, someone else must post a buy offer that meets your minimum selling price. Similarly, if you offer to buy stocks, someone must be willing to sell to you at the price you requested.    

   

G. Managing Your Portfolio

• Once you're satisfied with the details, click “Place Order” and you'll be returned to the Your Portfolio page. There you should see, under Recent Orders, the order you just placed. Once someone has sold you the shares at your requested price, the Status of the order will turn to a green “Completed” and the stock will appear under the header of “Your Share Holdings”.  
  
  The portfolio page allows you to monitor your current investments closely. It also keep your orders of stocks separate, so that you can track how your initial investment in an corporation is performing compared to additional shares you bought later in the same corporation at a different price.  
  
  At any time you may click “Sell” or “Buy More” which will bring you back to the Place Order Screen. In the event that you click sell, be sure to specify the number of shares you want to sell before clicking “Place Order”. By default, it lists the entire order as for sale. You may also transfer shares—but not gold—to another registered ERX user if you so desire.