AutoSurf Industry : The Long View
by BradH
22 January 2006
When I got serious about online investing a year or so ago, I was
disappointed by the lack of real mathematical analysis in the industry.
My name is Brad, and I am an economics student at Yale University. I've
written another autosurf modeling newsletter, The Syndicate, for several
months now, and I am a regular member of several autosurfing forums. I
started developing my own models using simple mathematics shortly after
getting into the industry, and I found them very helpful when deciding
where to put my money. These models use a variety of data (published data if
possible, hits and other statistics if not) to gauge the solvency of
programs. For example, Alexa's reach variable, which is the percentage
of all internet users which visit a site, can be a wonderfully informative
substitute for direct data on membership.
To give you a sense of how my modeling is done, I'll construct a basic
model here using Alexa reach. First, it is necessary to measure the daily
return on investment (ROI) of a program. For example, 12DailyPro is taking
roughly 20 days for one cycle (including time spent waiting for payout) to return a ROI of
44%. That's a daily ROI of 44/20, or 2.2%. If the program shows a comparable
growth rate on Alexa, it is doing fine even without reinvestment. In
the month of December, 12DailyPro grew at a rate roughly 1.7% daily. While
this is certainly fast, it isn't fast enough to keep up with payouts if no one
is reinvesting. These are the types of calculations I do.
While basic models comparing the daily ROI of a program to its growth
rate can go a long way, other models can be used to analyze programs in more
detail. For example, taking the calculation I just did, it is easy to
calculate the percentage of profits that members must be reinvesting for
a program to break even. Then, this number can be analyzed to see how
stable the program will be in the long run. As shown in our previous example,
12DailyPro would need to have an effective daily ROI of 1.7% to break
even. This is 0.5% different than the ROI they are paying; the difference must
be made up by reinvestment. Thus, 0.5% divided by 2.2%, or 23% of all
12DailyPro profits must have been reinvested in the program in the month
of December for the program to break even.
For most programs, I assume that they don't have any income outside of
new member upgrades-that is, they are a ponzi. While this isn't exactly
true for many autosurf programs, I've found that most companies paying out
more than they're accumulating in upgrades aren't healthy whether or not they
have outside income. There are a few notable exceptions, of course. As
you might imagine, this assumption works exceptionally well for HYIPs.
I run dozens of programs through my models each week, and in this column
I'll pick out a few of my favorites to share with you. I don't offer
any guarantees, and diversification is always the best strategy. That said,
let's use mathematical analysis to look at a few new and interesting
programs.
Surfice launched in
late December, and pays 2% per day for 180 days. With an average load time of
3.9 seconds, its server speed is faster than most in the industry, and
surfing is smooth. Although the site hasn't had to make any serious payouts yet,
it should have funds to do so through at least February, assuming a
reinvestment percentage of only 20% (meaning people reinvest 20% of
profits-reread my example above for explanation) and no growth in
February. Since both of these are almost certain underestimations, Surfice should
be solvent for at least several months. On a final note, there have been
some rumors that Surfice is owned by Aaron Bowering, the creator of the
closed programs PaidResponse and PaidExposure. Although the script is similar,
I highly doubt a new Aaron Bowering venture would accept Paypal (as
Surfice does). PR/PE's vulnerability to Paypal chargebacks was probably the
greatest factor leading to Aaron's demise, and it undoubtedly cost him
thousands.
DadnDaves is now the
third
most popular autosurf program out there right now (behind 12DailyPro
and,
inexplicably, StudioTraffic). It's going private on January 26th, and
the
number of cheerleaders pushing people into this program recently makes
John
Horan's "sales teams" look like amateurs. Veteran HYIP investors know
that
programs often announce that they are "going private" to accumulate lots
of
upgrades immediately before disappearing with the money. David of D&D's
seems honest and has paid for six months, so I doubt this is the case.
Still, to be safe, this is my suggested strategy for those who haven't
joined D&D's yet:
Before January 26th - Join and upgrade $10 to keep an active account
After February 1st-If payouts go well, upgrade as much as desired.
On a final note, it is also possible to make predictions about HYIPs
using
mathematical models similar to those described above. In some ways, the
models fit HYIPs better than they do autosurfs-for example, HYIPs are
less
likely to have outside income, and are more likely to publish deposit
and
withdrawal statistics. On the other hand, problems can arise when
attempting to gather data on these programs. Alexa is rarely useful
when
researching fast-moving high-yield programs, and statistics published on
a
program's website aren't always reliable. Regardless, I will
occasionally
mention a specific HYIP which I believe to be a good short-term
moneymaking
opportunity. Any information on here about HYIPs is very time-sensitive,
as
picking the right time to get in and the right time to get out is
crucial.
I believe both of the autosurf sites I mentioned are good moneymaking
opportunities, but as always, make your own decisions. Surfice and
DadnDaves both seem to be here for the long haul. Hopefully I've been
clear
enough with the explanations of my models; I'll go into more detail
about
specific aspects of them in future newsletters. Good luck, and happy
surfing!
Brad Hargreaves is a second year economics student at Yale University. He
also authored The Syndicate, an autosurf modeling newsletter.
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