SecondLife: Interview With Adam Constantineau, Foreign Exchange Trader

I'd found Adam Constantineau through Jill Kearny yesterday. Jill ended up investing in this venture - her comment being: 'It's a new business idea that needed support, plus the chance to make money of course.'

Adam was nice enough to allow me to interview him today. His business, 'The World Currency Exchange', will be opening tomorrow; details of which are below the interview.

Nobody Fugazi: Hi Adam, thanks for your time. I'll just jump right in and get started.

The whole business revolves around trust.... why should people feel safe about dealing with you? (It's what they will ask)

Adam Constantineau:Well, i've been around for a while in a couple of different things. For a start, I co-founded the Citizens Bank a little while back. I decided to leave that to my then partner to pursue the exchange though, but all was well. I used to provide many a loan to poor new SL residents in fact, the question should be - how do i know i can trust the residents? SL residents tend to be of a stronger moral fiber than in real life it seems and I trust the majority.

Nobody Fugazi: So it's all based on mutual trust, then?

Adam Constantineau: Yes, and it's also a matter of the returns.

Nobody Fugazi: Aha. So it's a balance, then . Everyone is asking, "do I trust this guy more than the profit that I can make?" sort of thing.
Ok- well, how does it work for the client?

Adam Constantineau: Well, to explain the process simply, the customer deposits their L$, and we, in return, back their investment as a margin trade. Margin gives us a couple of advantages. The first is for the customer. If they know what they're doing, or can see the future - then they will take advantage of margin trading and make a tidy profit. The second is that margin trading can be a gamble and like any business where there is an element of chance. We take advantage of this, and return a percentage to our shareholders.

For example, if a customer puts in 100L, then we will allow them to trade 1000L. If the currency they're investing in goes well, then we will take only our pips and allow them to keep the margin profit as if it were their own money. If the currency they're investing in goes south, then we will automatically liquidate their balance once they have reached the limit of what they have. If they have lost 100L on margin, and they have invested 100L only to begin with, which is traded at 10:1 margin to be 1000L, then we will liquidate automatically once the 100L loss has been registered. A combination of good sense, a gambler's instinct, and shareholder interest.

Nobody Fugazi: What's the minimum amout a person can deposit?

Adam Constantineau: 1L, but i wouldn't expect to be able to trade much with that amount :)

Nobody Fugazi:

Adam Constantineau: You see, we have no minimum. You can trade USD in the cents if you wish on margin.

Nobody Fugazi: The average person on the planet probably doesn't know as much about this stuff as you do - where can they learn more about the basics?

Adam Constantineau: Wikipedia is an excellent place to learn about Foreign exchange trading. Plus, i will be hosting a lesson on basic forex trading on opening day. Assumed knowledge will be to understand what margin trading forex means. Wikipedia will help there.

I'm pretty sure the average sl resident will have very little trouble getting trading, especially with the direct point and click interface i've set up.

Nobody Fugazi: Well, as you know, I found out about you through Jill Kearny - someone who was looking to invest. So this brings us to the next question - how would you rate forex trading as compared to Ginko Financial and Citizen's Bank as far as risk and return?

Adam Constantineau: Different kettle of fish entirely. :-) With something like Ginko, or any other interest paying bank, you are counting on the bank to make a fixed interest payout for you all the time. Here, you can make a very high interest rate indeed if you have at least a vague idea of what to do. The risks are higher, and the potential benefits are much greater. It's for those who want a bit of excitement and more of an involved approach to their investments in SecondLife.

Nobody Fugazi: It sounds like it stands to be a social thing as well - where people will exchange information and benefit from their investments in a collective method, since they are not competing. What do you think?

Adam Constantineau: That's a nice way to look at it. Nothing would make me happier than to see the floor bustling with chatter and an exchange of information, skills and ideas.

Nobody Fugazi: That will depend on the people, of course. So - on to a different level - What do you think of the taxation of virtual income in Australia?

Adam Constantineau: It makes sense that any income would be subject to tax. I'm looking into it.

Nobody Fugazi: Is there anything that you would like to add?

Adam Constantineau: There's not really anything you need to do to "make" people trade, just let them know you exist. Hopefully, there'll be a tidy profit to be made for many bored investors quite soon, pending their forex skills and luck of course ;)

There's not much I really can add to it - the beauty of forex trading is that those who do and want to trade will.

Nobody Fugazi: Thanks for your time, Adam, and good luck with the opening.

The World Currency Exchange - FOREX/LINDEX - Opens December 1st at noon, SLT, and can be found here: Cleary (91, 48, 112). If you're unfamiliar with this sort of trading and are interested, you may want to do some reading of the resources below before showing up tomorrow.

• Foreign Exchange Trading
• Margin Trading