Money in the hobby

[kailes2872]

Originally Posted by Exhibitman

Oh, and cards aren't an investment. They are an illiquid asset with huge transactional costs at both entry and exit. If you want to bamboozle the wife with ROI talk to justify a trip to the National to hang out and party at the hotel bar I can totally respect that but don't expect me to buy into it. Maybe a Wagner is an investment but a vg T206 is a toy for boys. Not that there is anything wrong with that. I mean chicks dig guys who collect cards: look at all the women in the hotel bars in Chicago the first night of the National. So friendly. Gotta be the cards. Right?

This is what I keep coming back to... The 20% juice (or 13% + time & energy on Ebay) speak to those huge transaction costs. If my broker charged me this to move in and out of funds or single stocks, I would probably not consider the stock market a place that I would want to invest - considering how much work it would take to make money above the transaction costs.

I did laugh about bamboozling the wife - as whenever the arms cross and I get a stink eye about the latest card/set/project that I have bought or began, I pull out my inventory on the PSA registry page that shows that I have made about 20% above what I bought them for. Of course, this is SMR which does not feel very real world, and she & I know that I have no intention ever to sell - (and she doesn't realize that I am 80 cents on the dollar at an AH or less than that selling to a dealer) - but it cools down the heat in the kitchen and sometimes I will go on the offensive and compare the 20% return on my inventory to a measly 8.8% return on our liquid assets. Some day she is going to call my bluff and say - sell it all and I will have to explain that it really isn't that much above what I paid for it - if any at all - after fees are taken into account.

[Leon]

Taking the bluff might not be that bad for you down the road. It wasn't that bad for me. My return was much better than 20%.
My wife never thought I wouldn't do it either. Now I just tell her in 20 more years I will do it again.

Originally Posted by kailes2872

Some day she is going to call my bluff and say - sell it all and I will have to explain that it really isn't that much above what I paid for it - if any at all - after fees are taken into account.

[ls7plus]

Originally Posted by Leon

Taking the bluff might not be that bad for you down the road. It wasn't that bad for me. My return was much better than 20%.
My wife never thought I wouldn't do it either. Now I just tell her in 20 more years I will do it again.

+1. When you have something that you've held for a lengthy period, and you've made such a good selection regarding the item in question that the auction price is 10, 20, 30, or more times what you paid for it, the 20% juice doesn't make much of a hit at all, from my perspective. At or about 1990, the Standard Catalog, if I'm not mistaken, had the M101-4 and M101-5 Ruth at $1800 in near mint. Now frankly, this was conservative, but I recall bidding in a Sports Collector's Digest auction for one in ungraded ExMt in the mid-nineties. Unfortunately, I bid up to $5500 and it went for $6000, but compare that to the current Heritage auction, where, when I checked a couple of hours ago, the PSA 7 example was at $480,000, including the buyer's premium.

Best wishes,

Larry