Guild Wars 2 - Smart Salvaging and Forging Guide for max Profits by the_jimin

Since Silverwastes is the most popular farming method at the moment, I have a trick to make more money every hour. A lot of people merely sell/salvage greens, but there is a method that can make you more money if you use the mystic forge instead. A mystic forge conduit is best used in this case, but for most people the cost of one (800~g) is out of reach. However, over time, you can eventually make it back using this method.

THE MATH: To begin, the average vendor price of a green armor/weapon is about 1.7~s. The chance of upgrading from a green to yellow by putting 4 greens in the forge is 20%. This means, on average, to get a yellow, it would cost 3 * 5 * 1.7 + 1.7 = 27.2s for each yellow. You get a green back each time, so that is why I multiply by 3. Now the average amount of ectoplasm from a yellow is .89. So with this method, on average you will make 35 * .85 * .89 - 27.2 = -.7s. This may seem bad, but you have to factor in the materials you get from salvaging too (which averages out to be about 3 - 6s if you get ancient logs, silk, orichalcum etc.). Add this to the 80% chance of a major rune or sigil, and you end up with about 6s of profit with this method. Note: If you get a cloth green, always salvage for the silk.

Now to the interesting part. Forging armor actually nets you more profit overall, since armor have a 33% chance of getting an item that can be salvaged into silk, which could be between 2s-10s profit depending on how many pieces of silk you receive. Add this to the fact that major runes are 1s more expensive than major sigils. This means that armor is always better to forge. Now if you mix and match armor and weapons in the forge, you will now have a chance of getting either. So to maximize profits, mix 3 weapons with 1 piece of armor so you get a .5 * .33 = 16.5% chance of getting a cloth yellow or green. Once again, always salvage the cloth for silk. 

Using this method, you can be sure to make at least 6-20s every 15 green items. If you do not have a mystic forge conduit, simply save your bags of gear when you are near a forge. As a general tip, it is better to sell the blue non-cloth armor/weapons. Also sell high demand yellow items such as Greatswords, swords, daggers, staves on the TP instead of salvaging. Best place to forge and sell is Lions Arch (sell blues to the chick next to the forge). If you have a forge, there is a lot of downtime during Silverwaste events, so you can just open your bags there and never leave Siverwastes. 

http://imgur.com/HfoOeKh

This image shows what a mystic conduit looks like, as well as an example forge. 

TLDR: Forge greens into yellows. Salvage yellows. Mix 3 weapons with 1 armor. Always salvage cloths. Profit. 

SOURCE