Price-manipulation can be a very good way to make money, especially if you already have a decent amount to invest. However, the risks can be potentially disastrous, so paying close attention to prices and playing RuneScape regularly are important. Also, make sure that you can trust the clan you join. If the clan keeps "dumping" early, then never invest any money into that clan. If you aren't sure about the clan, do not immediately invest all of your hard-earned cash. Even when every appropriate measure is taken, however, there remain unavoidable risks.
As most players consider this a "grey" area in the rules, players engaged in price-manipulation clans should keep abreast of Jagex announcements regarding rules and rule interpretations and should be careful that their own behaviour remains within the rules. Jagex is the final judge of what is or is not a rules violation, and allegations of deception involving present or possible future value of items may be punished under the item-scamming rules, so avoid anything that might be interpreted by others as deceptive or misleading, including insider trading and making promises about potential profits.
Price manipulation clans act in the same way that casinos do in real life. Players can bet large amounts of money, or small amounts. Players may bet and lose or win massive amounts of money.. Some may win more because their strategy is better (ex: not selling at advertised clan price target but at a half or a third of it). In the end, however, "the house" always wins. In this case, the house is the group of clan leaders who decide when to dump items.
It is worth noting that on 8 June 2009, Jagex locked the clan chats of several well known price manipulation clans, taking a somewhat firm stance against this form of trading, although no clear statements were made.
One clan trading strategy is "price manipulation". It is analogous to collusion, which is illegal when done in the real world. While not strictly a rules violation (except in the forums, where posts to coordinate price-manipulation are strictly forbidden), most players consider it an unethical activity because the clan members benefit at the expense of other players, and often clan leaders at the expense of most of the other clan members.
The way this works is that a large group of players buy as many of a single item as possible, causing the price to rise over the course of several days. The players then sell back the item at the inflated price, resulting in potentially huge profits. This trick is magnified by the mechanics of the G.E., which do not allow a single player to purchase more than a certain number of certain item types per day (e.g.: 100 of every type of fur every 4 hours).
This collusion is a form of price manipulation and, while not formally against the rules (to date), is discouraged by Jagex. Jagex has stated that they can intervene as a last resort, "if we think price manipulation is going on, although the system has lots of safeguards to prevent that," so there is some potential for Jagex to actively suppress an excessive rise or fall in price. In one case, leaders of a manipulation clan claimed that uncut emeralds had failed because they had reached a price cap and Jagex had released There is much evidence of the leaders of some price manipulation clans engaging in unethical insider trading, acting on information before releasing that information to the clan as a whole: stocking up on the item before announcing it to the clan in order to buy at the lowest price, dumping their own merchandise to get the highest price before telling other clan members to dump merchandise, telling clan members to continue buying when the item has actually failed (in order to support prices while the leaders sell). They may also make a false show of democratic process, acting like clan members have a say in the choice of item when in fact decisions are made by the leadership. In most public manipulation clan chats, the option for unranked people to talk has been disabled. Players often may message ranked people to answer questions, but certain types of questions are ignored.
Jagex has issued conflicting statements about merchant/price-manipulation clans. In one post, Mod Jon H stated that, "We don't see anything wrong with merchanting [read: price manipulation] per se," but cautioned that clan members had no way to determine whether their leaders were advising them in good faith or using them for personal gain. However, CEO Mark Gerhard later discouraged the practice: "I see merchanting clans as pyramid selling schemes, where, typically, only a handful of players actually make any money and everyone else loses money - just like real-life pyramid schemes. Because of this, we are not in favour of them in Runescape, and try to warn players not to participate in them." To date, however, there has been no obvious action taken to stop this form of price manipulation as a whole except, perhaps, where other rules have been violated. In fact, many players publicly advertise these clans at the Grand Exchange every day with no apparent consequence.
