Quote:
Originally Posted by ThePressure
I don't quite get how he makes money.
-Timex believes players who sell shares are charging exorbitant markups on those shares.
Ex. Player A is selling shares for the main event at 1.5 MU. Thus if you want 1% of his action, you pay $150 instead of the $100 at face value.
-Timex believes that Player A is not good enough to warrant 1.5 MU, and assesses Player A's value at 1.3 MU.
-Timex then offers to sell pieces of Player A's action at a price inbetween those two values - perhaps at 1.45 MU. He pockets the money if Player A fails to cash, and pays out the percentage if Player A cashes. If he is an accurate predictor of MU and sells at a price that is above breakeven, he'll make a profit in the long term.
He's also offering action on any player, likely at MU lower than we're used to but what he still feels is overpriced (so he can make a profit).
Winners in this scenario:
1. People who buy shares. They're able to get a cheaper price investing in players, and are able to invest in any player they desire - even if the player would never publicly sell shares himself (Eg. Ivey, Blom). Timex is also highly respected in the poker world, and payouts from him are all but guaranteed (on twitter he claims to have a bank of ~10m between himself and his investors).
2. Timex. If the market is as overpriced as he believes, he'll be able to offer a service as well as make a profit - until the market corrects itself. If he's a good predictor of MU (Which I imagine he is, given that he's offering this service). Basically, he thinks players aren't as good as they claim, and is willing to undercut their staking prices (to a degree - he'll still be charging more than what he believe their true value to be).
He's also charging high markups on people who don't usually offer shares, exploiting the current market failure.
Losers:
1. People who overprice their shares and are denied action in favor of the BoT.
tl;dr - He's shorting the entire poker staking market, because (according to him) people aren't as good as they think they are.
Last edited by TheBroseidon; 06-10-2013 at 02:43 PM.