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Help > Auction > Automatic or Proxy Bidding
Automatic or Proxy Biddinggo to Help:Contents 
What is Automatic or Proxy Bidding?
Automatic or proxy bidding system enables bidders to win an auction at the lowest possible price. When bidding on an auction, bidders simply enter their maximum bid for an auction. The system bids on behalf of the bidder the lowest possible bid up to the bidder's maximum bid that could enable the bidder to win the auction or meet the reserve price if it has not been met. Bidder's maximum bid is placed only when there is a bid from another bidder that is higher than the bidder's maximum bid or reserve price is higher than the bidder's maximum bid.
Automatic bidding applies to all auctions including auctions with buy price, multiple unit auctions and auctions with reserve price. However, if auction has a buy price, a buyer can immediately buy the item without participating in auction. This implies that bidders must make sure that their maximum bid is lower than the buy price. If bidder is willing to bid equal to or more than the buy price, he/she can immediately buy the item without participating in the auction. This will reduce the available quantity of the item in auction by the quantity bought by the buyer(s). If there are no more units available, the auction will end and all bids, including buyer's bid if he/she has placed one, will become invalid.
Example 1: Mary bids $15.00 on an auction with starting price of $10.00 and no reserve price and no bids. This will make the current bid/price $10.00 and she will be the highest/winning bidder. The minimum bid will become $10.50 (current bid/price + incremental bid).
Example 2: Jerry bids $15.00 on an auction with starting price of $10.00 and reserve price of $12.00 and no bids. This will make the current bid/price $12.00 and Jerry will be the highest bidder. The minimum bid will become $12.50.
Example 3: Following events of Example 1, if Doug bids $12.00, an automatic bid of $12.50 will be placed on behalf of Mary and Doug will be outbid. The current bid/price will now be $12.50 and minimum bid will be $13.00. If Doug bids again with a maximum bid of $20.00, he will outbid Mary to become the higher/winning bidder and current bid/price will be $15.50. The new minimum bid will be $16.00.
See how incremental bids are calculated.
See also
How to buy & sell in an Auction?
Incremental Bid
Multiple Unit Auction
 
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