Sports Cards Investing

Has anyone been playing around with the idea of sports card investing?

I've been exploring it and it seems like a really promising endeavor. Returns are strong, the infrastructure is just being built and it is growing in popularity. I might be crazy but it seems like a pretty good time to jump in before it is established and ride the trend wave.

You would be able to implement many of the strategies used in traditional markets without the level of efficiency we are used. It seems like an interesting time and could definitely like establish a fund or company to capitalize on the growth.

Comments (29)

 
Jan 12, 2021 - 1:33pm

Great post! I'm very deep into this world. Market is priced high at the moment and has been trending up since even before Covid. Once Covid hit it really started taking off (like most collectibles nowadays).

 

Probably a bubble but then again I've been thinking it was a bubble for a couple of years now.....

 
  • Analyst 1 in AM - Equities
Jan 12, 2021 - 1:41pm

Okay, great. Maybe you can help clarify some things to make sure I understand the environment.

In addition to EBay and the like, there are other websites that act essentially as exchanges, right?

There are specific companies that grade the quality of the cards almost like rating agencies for bonds, right?

What other big infrastructure is involved within the ecosystem?

 
Jan 12, 2021 - 2:01pm

 

Okay, great. Maybe you can help clarify some things to make sure I understand the environment.

In addition to EBay and the like, there are other websites that act essentially as exchanges, right?

There are specific companies that grade the quality of the cards almost like rating agencies for bonds, right?

What other big infrastructure is involved within the ecosystem?

You are correct. eBay is still the major marketplace but there are other smaller websites where you can buy and sell cards easily.

and this isn't even taking into account things like Facebook Marketplace and IG which are becoming more popular but the risk with those is that there is less buyer protection / no formal feedback system etc etc. But plenty of transactions taking place.

 

yes, there are companies mainly PSA and BGS which can grade the cards but that's a whole other conversation in itself. Google "BGS PSA Consignment scandal/fraud" and you should find plenty of reading material as a few years ago there was a major finding that these grading companies were passing on high grades on trimmed cards to their biggest customers - big time consignors and the negative publicity has been crazy.

Lots of interesting reading for you I'm sure.

It's essentially an unregulated market (think like expensive basketball shoes/sneakers)and I have seen people move into this market over the last couple years and get burned because they think they can just make money quick. It's gambling but I have tested my model, theories, strategies over the last I'd say twenty years and I've done very well. Not doing this full time lol but my margins are terrific and I also invest specifically in a certain niche within the overall market. It's interesting stuff for sure !

 

 
  • Analyst 1 in AM - Equities
Jan 12, 2021 - 1:43pm

Im definitely not late. I might be later than some of the early movers, but notice how underdeveloped it is compared to traditional markets and other alternative assets like Real Estate, PE, Venture Capital. After all, it's another alternative asset. It still has a long way to go.

 
  • Intern in HF - Other
Jan 12, 2021 - 7:37pm

Grew up trading baseball cards and Topps has effectively put all of their competition out of business. They've grown to such a large scale that most of the other baseball card companies can't/won't threaten their business (a few card companies can't even use MLB's logo). 

Another issue with cards is that you're never going to get $50 of value in a box if you spend $50 or $1000 if you spend $1000. In other words its completely speculative and entirely based on luck when you're buying boxes. I've watched a few card breaks on YouTube for high end boxes ($5000+ per box) and the product is pretty underwhelming considering you're spending $5000. 

There also aren't going to be any cards going forward that are as intriguing as the Honus Wagner card. Guys like Bryce Harper will have signed 10,000+ autographed cards by the time they retire. Why would anyone pay $10,000+ for a Bryce Harper 1/1 card or of similar rarity when you can get other autograph cards for $200-$300? Sure the cards cool but is it worth spending 33-50x what you would for an average autograph card. 

Whats gone on with cards during the pandemic though has been insane. Best friend pulled a Juan Soto 1/1 rookie autograph a couple of years ago and sold it to a family friend for $700 (he's the top Topps dealer in the world for all cards). Family friend then sells it for $3k before the playoffs thinking he made a solid deal. Nats win the WS and card jumps to $25k and said the other day the card is now worth somewhere near $100k. 

 
Jan 12, 2021 - 8:31pm

I have a box of baseball cards from 1990 - not sure if they are worth anything. Mint condition.

"If you always put limits on everything you do, physical or anything else, it will spread into your work and into your life. There are no limits. There are only plateaus, and you must not stay there, you must go beyond them." - Bruce Lee

 
Jan 12, 2021 - 11:00pm

Oh ok cool. I saw Jeter in the gym one day in NYC.

"If you always put limits on everything you do, physical or anything else, it will spread into your work and into your life. There are no limits. There are only plateaus, and you must not stay there, you must go beyond them." - Bruce Lee

 
Jan 12, 2021 - 11:04pm

wow I hope I have this one:

 

1990 Topps #414 Frank Thomas Rookie Card

No Name On Front Estimated PSA 10 Value: $50,000

-

"If you always put limits on everything you do, physical or anything else, it will spread into your work and into your life. There are no limits. There are only plateaus, and you must not stay there, you must go beyond them." - Bruce Lee

 
  • Intern in IB-M&A
Jan 14, 2021 - 5:59pm

Great call! Any thoughts on the D1/P72 buyout? Think the tender offer will be approved by shareholders? 19th is the deadline. I'm hoping offer gets rebuffed- 3% premium to closing price when deal closed is robbery for shareholders. Would assume buyers come back w new offer at $100+ per share if it gets voted down

 
  • Associate 1 in CorpDev
Jan 14, 2021 - 8:04am

I can't help but find all of this just completely ridiculous. And I loved baseball and baseball cards as a kid. To each their own I suppose.

 
  • Analyst 1 in AM - Equities
Jan 14, 2021 - 8:10am

Yeah, I would probably avoid baseball cards altogether. That's been around for decades. I was referring more to the other sports - that's picked up recently.

 
Jan 14, 2021 - 8:18am

I collect for my own enjoyment but if you're looking for investment, I'll repeat what others have said above. You're late to the party. People are throwing thousands are Bowman rookies of players who are 17-18 yo and haven't even played an mlb game, while autographs and rookies of HOFers are going for significantly less. That leads me to believe that there's probably some sort of bubble and once people start getting burned on these cards, they will pile out of cards.

 
Jan 14, 2021 - 9:18am

About 10 years ago I gave away my collection from the early-to-mid 1990s to my cousin, who had no interest in them and tossed them. Obviously, I don't even want to know what I had. F my effing life.

Array

  • 1
 
Jan 14, 2021 - 10:00am

real_Skankhunt42

About 10 years ago I gave away my collection from the early-to-mid 1990s to my cousin, who had no interest in them and tossed them. Obviously, I don't even want to know what I had. F my effing life.

If it was baseball I wouldn't sweat it too much as that time period had a ton of mass produced crap. Now if it was NBA it could be big money if say mid to late 90's early 2000's.

 
Jan 14, 2021 - 10:15am

Waiting for my rookie steph curry and KD cards to go up. Still have to get them graded (which takes forever these days from what I've heard). Also, StockX is a great place to buy and sell cards now. Fees are relatively the same as eBay, if not better.

 
Jan 26, 2021 - 9:29am

Hida Kisada

HIV Neutral

Waiting for my rookie steph curry and KD cards to go up. Still have to get them graded (which takes forever these days from what I've heard). Also, StockX is a great place to buy and sell cards now. Fees are relatively the same as eBay, if not better.

- expand -

 

I haven't tried StockX yet. In my experience it's hard to replicate the amount of traffic , exposure , etc that eBay brings but I'll look into StockX. What are its advantages?

 
Jan 14, 2021 - 10:26am
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