What is trading power and how you can benefit from it?

If you have any interest in exchanging your timeshare through RCI or  Interval International, the concept of trading power becomes of utmost importance.

Generally, trading power is the concept of the value assigned to your deposited week or points that will allow you to see certain inventory within the exchange company.  Basically, the exchange company wants to take in high demand weeks and resorts and in exchange will give you the ability to trade into other high demand weeks or points. 

The exchange companies generally want to limit the ability to deposit a low demand week and have that timeshare owner receive a high demand week.

RCI defines trading power as:  "The value assigned by RCI to Vacation Time upon a Deposit and used by RCI to fulfill an Exchange Request."

Interval International uses the concept of Comparable Exchange for its trading power.  Comparable exchange attempts to match the quality of the week deposited with the quality of the inventory shown to that user. 

While the terminology for the concept of trading power differs between exchange companies, both of the major companies utilize various factors to determine the appropriate trading power of the week you own and then filter the inventory you see when you are searching for an exchange. 

While not inclusive, the various factors are generally taken into consideration:

1. Supply and Demand;
2. Quality of the facilities;
3. Unit type and sleeping capacity; and
4. Amount of time between the date of the deposit and the date of the week.

Trading Power is a elusive concept since none of the major exchange companies will disclose the actual trading power of the deposited weeks or explain what inventory you can see and what inventory you cannot see.  There are many theories on how these are calculated but nothing concrete has been disclosed that has actually shown the specific calculations.

Overall, in the event that you want to own a timeshare, good trading power is essential in order to be able to see prime inventory.   I would recommend the following:

1. Review the resorts that have the highest ratings within both systems.  Interval's highest tier rating is now called Elite and RCI used the gold crown award standard.  Those resorts with those ratings will generally be given the highest trading power even if the week is not a prime week.

2.  If you know that you will not be using your home resort, deposit the week or those points as early as possible.  The earlier you deposit the better the potential trading power.

3. Some types of units are considered lock-off units.  Generally, it is a 2 bedroom unit that consists of a one bedroom unit and studio unit with connecting doors.  The exchange companies can value these types of units higher than other types since they can rent the 2 bedroom or it can be split into a 1 bedroom and a studio.  Generally, the exchange companies will give more "trading power" to these types of units due to the flexibility.

4.  Own a desired week.  This can be during a holiday, festival, certain events or any desired summer week.  The more desirable the week, the more the exchange company will value the unit and the better trading power you will receive.

Trading power is an important concept if you want to exchange your unit.  Exchanging your timeshare is an important method to use if you want to maximize your ownership.

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