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Originally Posted by Fred
Bubble? Needle?
How are comps supposed to work?
Isn't it an average of the latest prices paid? I'm guessing someone can manipulate comps.
Does everyone "buy into" the comps? How do comps work when there are only a few items tracked and the last realized price was because two people bid up the price. Is that a "new" realistic comp?
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I think most of us are pretty savvy here, at least in terms of recognizing that comps are an interesting starting point, but far from gospel.
As you noted, there are lots of reasons why comps might be sketchy, just because they're old, they're outliers, or there are very few (if any) data points. Not to mention that everyone always thinks that their PSA 7 is a lot nicer than the other PSA 7s that you're looking at for comps.
I think comps work great for commodity cards that trade all day every day in public places, at least to give you a nice range of values.
For anything that is rare and doesn't sell very often, comps are usually pretty meaningless. You can try to interpolate by looking at adjacent pieces, but often that's a pretty big guessing game as well. In those cases, you're really left with whatever price the buyer and seller decide works for them. It could take a long time before the seller finds a buyer who is willing to pay their asking price, and sometimes the market doesn't clear because the owner can never find someone willing to pay their price.
Or you could just put it up for auction and see what the bidders decide! Although even there, for rare items that are obscure and not currently in high demand, the price might not be all that representative, simply because a lot of the potential buyers might not really be paying attention.