Money in the hobby

[Dpeck100]

There is no doubt that there are cards out there that are so rare that the card in any condition can perform quite well. That said of those examples once again the higher you go up the grading scale the better the performance will be. Human behavior in many cases is very easy to predict and when it comes to things of value the higher up the food chain you go, they want collectibles that could impress others who share their level of wealth. For years on the CU board I have discussed the 1952 Topps Mickey Mantle in a PSA 10. I believe that if one comes available it is very likely to land in the hands of a non card collector. Someone with roots to the 1950's and 60's Yankees who has vast wealth and would love to showcase such a rare specimen in their 60th floor penthouse. Quite frankly the higher the price goes the more they will want it as the bragging rights associated with such a card only go up as the price does.

I continue to be puzzled by the notion that some suggest that cards aren't investments. You may not view your collection as an investment but in the real world anything that can be called a store of value is an investment. In 1985 when I began first purchasing cards Dwight Gooden was all of the rage. A pack of 1985 Topps was $0.35 and the goal as a kid was to buy a pack and get cards that were worth more than your $0.35. If you did your investment made money. If it didn't you lost and felt sorry for yourself and had to scrounge up some more funds to play the lottery again. All of the kids in my neighborhood couldn't wait for that months Beckett to come out and see if our collections were gaining value.

The card market is very much like the stock market. You have a huge number of choices and varying degrees of risk. On one hand you have long term winners that using history as a guide have done well over time all the way to registry cards that are more like penny stocks with some paying off but most going down overtime as the populations increase. The modern market would be considered very high risk but with that risk level, some will produce massive gains while most will fizzle out and be worth a fraction of their value in the future.

People buying cards that are $5,000 or perhaps $10,000 or higher are definitely in almost all cases concerned about the value. It may not be their primary motive for purchase but if one thinks that someone is interested in buying a card for that sum and watching it dwindle down to a few hundred bucks they are simply mistaken. The run that many cards have had since I got back into cards in 2009 is staggering. As the prices have risen it has given many more resources to use for other purchases and confidence in their ability to invest in the card market. The term investment shouldn't be considered a bad word when it comes to cards. It takes real resources to purchase them and unless ones funds are simply unlimited it isn't even rational to not want them to hold their price and hopefully increase.

I started sending cards to PSA in early 2010 and I have never participated in anything where the upside is so much greater than the downside. It is incredible that you can send cards to a grading company and simply pay a fee and instantaneously have the potential to wildly increase their value. There are countless collectors and dealers who have 100 baggers on cards. Find me a stock that you can buy and have this happen. I am in the stock business and trust me it is incredibly difficult to pick big winners but even more difficult to hold them and ride them for long periods because at some point you buckle and sell. The other feature that cards offer is they can't go to zero. Even players like Barry Bonds who was on the perennial cold list have seen their higher graded cards make a huge resurgence.

Combining fun, nostalgia, competition and investing in one hobby is incredible and one of the primary reasons that more people are entering the hobby and that people are willing to pony up larger sums to participate. It is true that most cards aren't what you would classify as safe investments but those making very strategic bets on marque pieces have done extremely well over time and that isn't going to change.