DETAILED INSTRUCTIONS

**If you have questions that these instructions do not answer, please call or email us to get answers. You should have been given the appropriate TEL# and E-mail address with your initial instructions.


I. IMPORTANT TEL#s, EMail addresses, and URLs

If you have any questions or comments, please contact the experiment administrator
      marketscape@gmail.com
      (XXX) XXX-XXXX

Important announcements will be posted to the following WEB Page during the experiment.
      http://hss.caltech.edu/~eeps/news.html




II. HOW YOU MAKE MONEY

There is a public market in which you can buy and sell units to other people. The computer will maintain a record of your inventory, trades, and cash.

You also have a private market that can be accessed only by you. For buyers this market might be labeled “values” and for sellers it might be labeled “costs”.

You will make most of your money by either (1) buying in the public market and collecting the values (reselling) in your private market (see Example #1 below), or (2) by buying in your private market (your cost) and reselling in the public market (see Example #2).

EXAMPLE #1

Suppose the best offer in your PRIVATE BUY ORDER BOOK (the VALUES) is 200 and the best offer in the PUBLIC SELL ORDER BOOK is 100. If you purchase a unit at the best offer in the public market and collect the value (resell) at the best offer in the private market, you make a profit.

	Value (Sale) in Private Market		200
	(you accept a sell order)		 

	Purchase in Public Market	100
	(you enter a buy order)
				   __________
	Profit (added to cash)		100	

EXAMPLE #2

Suppose the best offer in the PUBLIC BUY ORDER BOOK is 200 and the best offer (cost) in the PRIVATE SELL ORDER BOOK is 100. If you purchase a unit at the best offer price in your private market and resell at the best offer price in the public market, you make a profit.

	Sale in Public Market		200
	(you enter a sell order)		 

	Purchase in Private Market	100
	(you accept a buy order)
				   __________
	Profit (added to cash)		100	
The profits you make are yours to keep.

In order to conduct trades, you will need to understand the different types of orders.


III. GLOSSARY OF IMPORTANT MARKET ELEMENTS


ORDERS - orders are accompanied by a price. When you submit an order you are saying that "your are willing to trade at the price stated or at some better price." (more)

If you submit a SELL ORDER you are saying that you are willing to sell to anyone at the price you state, or at a higher price.

By submitting a BUY ORDER you are saying that you are willing to buy from anyone at the price you state, or at a lower price.

If no one accepts the order it goes unfilled. Your unfilled order remains in the order book until it expires, is canceled by by you, or until it is taken by another person.

An order LIMITS the amount you receive or the amount you pay by the price you state.


ORDER QUANTITIES - You may place orders for any number of units. The computer will automatically fill orders if possible. If your order is for more units than can be bought or sold at your price, the computer will partially fill your order. Partially filled orders will remain on the order book until they are completely filled, canceled, or the market terminates.

THE SELL ORDER BOOK - is a listing of the sell orders. The orders are listed from highest order at the top of the page, down to the lowest. The lowest is the BEST sell order from the buyers' points of view and it is found at the bottom of the sell order book. Buyers will examine this book when deciding whether or not to buy. Selling always stars at the bottom of the book (the BEST) and then moves up. The market automatically matches the cheapest existing order in the sell order book with an incoming buy order to determine if a trade is possible. (more)


THE BUY ORDER BOOK - is a listing of the buy orders. The orders are listed from lowest at the bottom of the page, up to the highest. The highest is the BEST buy order from the sellers' points of view and it is found at the top of the buy order book. Sellers will examine this book when deciding whether or not to sell. Buying always starts at the top of the book (the BEST) and the moves down. The market automatically matches the highest existing order in the buy order book with an incoming limit sell order to determine if a trade is possible. (more)


Should you send a SELL ORDER with a price lower than the best buy order in the buy order book, then a trade will occur and your order will be filled at the buy price, which is to your favor. For example, the best buy order is 600, and you send in a sell order for 500. You will sell at 600 (instead of sell at 500). The situation is analogous if you send a buy order. If the best sell order is 500 and you send a buy order for 600. You will buy at 500 (instead of buy at 600).

WARNING!

YOUR WEB PAGE DOES NOT UPDATE AUTOMATICALLY.

REMEMBER THAT THE INFORMATION DISPLAYED BY YOUR WEB BROWSER MAY NOT BE UP-TO-DATE. So when you see a good offer posted in the book and rush to send in a limit order to take it, there is the possibility that someone may beat you to it and that your limit order will either be unfilled or be filled by the next best available offer.


YOUR PRIVATE MARKET is seen only by you. There is a limit order book in your private market. Only the experimenter can place LIMIT ORDERS in your private market. Frequently the limit orders in the private market might provide special opportunities fo r you to make money; note, these opportunities are available only to you.

The limit orders in your private market need not be acted upon unless you think it is in your interest to do so. In your private market you can select the order that you wish to fill. Since the orders have different expiration time you may want to consi der your actions base on both the expiration and the price of the order. By contrast, in the public market, contracts are always accepted as ordered by price.

Suppose you find a buy order in your PRIVATE MARKET BUY ORDER BOOK. You should compare this price with the sell orders in the public market. If you buy a unit in the public market you can resell it in your private market at the price you see in the PRIV ATE MARKET BUY ORDER BOOK. The profit you make, while doing this, is yours to keep.

	Sale in Private Market		200
	(you enter a sell order)		 

	Purchase in Public Market	100
	(you enter a buy order)
				   __________
	Profit (added to cash)		100	

Suppose you find a SELL order in your private market sell order book. You should compare this with the BUY orders in the PUBLIC market. If you buy a unit at the price you see in the PRIVATE MARKET you can resell it in the PUBLIC market. The profit you ma ke, while doing this, is yours to keep.

	Sale in Public Market		200
	(you enter a sell order)		 

	Purchase in Private Market	100
	(you enter a buy order)
				   __________
	Profit (added to cash)		100	

If you purchase the unit from the experimenter, you should try to resell it in the public market before the end of the market experiment. You are rewarded only for cash on hand at the end of the experiment. In essence, units are worth nothing to you at t he end of the experiment.

Again, no one but you will see your private market. The orders sent by the experimenter to other people may or may not be similar to the orders that you receive.




MARKET ORGANIZATION

The market screens should be self explanatory. You will be free to send buy or sell orders to the public market. Limit orders received will be placed in the public market BOOK unless you choose otherwise. The limit sell orders are arranged from high to low at the top of the page. The limit buy orders will be arranged from low to high starting at the bottom of the page. In the middle of the page you will see the best (lowest) sell order that is in the book and the best (highest) buy order that is in the book. These orders are displayed publicly for everyone to see.


CASH LOAN In these markets, initially, you will be loaned some amount of cash. There is a good reason for the loan. Without cash the computer would let you do nothing since you are not allowed to have negative cash. However, you must repay the loan before the en d of the experiment. You need not worry about the technology of repaying the loan; the computer will simply take cash away from you at some pre-determined time. The cash will be taken away from you in such a way as not to affect your overall trading cap acity.

UNIT LOAN In these markets, initially, you may be loaned one unit of the abstract commodity. This is your inventory. This loan must be repaid in full before the end of the experiment. There is a good reason for this loan unit. It will allow you to sell in the pub lic market if the price in the public market opens high. You can then replace the loan unit by purchasing a unit in your private market. The design removes a slight element of risk.


PERSONAL STATUS PAGE contains the following items.

(1) CASH ON HAND Your cash on hand is the running total of your revenue from all sources minus purchases from all sources. (Market sales purchases) At the end of the market, the cash on hand is your profit.

(2) UNITS- This is the number of units you have on hand at the moment. Units themselves are worth nothing to you after the market closes.

(3)OUTSTANDING ORDERS This is a listing of all orders that you have posted in the market order book. If you want to cancel the orders you can do so from this page. You will want to cancel orders that you have posted when you do not want these orders to be taken by other people in the market.

(4) PERSONAL TRADING RECORDS Your personal trading record page informs you of trades that you have transacted.


MARKET HISTORY page is a listing of all transactions made by all people. It is a complete account of all trading activity.