Liquidity & Investing vs collecting

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Originally Posted by trdcrdkid

As someone who writes about investing for a living, and has done so for the last 18 years, I have to chime in here, even though I'm at work and don't have time to write a lot. Yes, sports cards can be seen/used as an investment. But Bill Gregory's point, which I agree with 100%, is that they are a very risky investment, given the high price volatility, the lack of regulatory oversight, and the documented fraud and other shady doings in the industry.

I am not sure I would ever feel comfortable suggesting to someone to invest in sports cards but for those who understand the market overall, I would not call it high risk at all. Typically there is not high volatility in prices. It is a market which is easily to navigate and has a great deal of transparency. Sure the hobby has plenty of fraud but is that more or less than has been happening for decades on Wall St? The fact that Wall St is regulated has not protected the average investor.

Yes, of course it's possible to make money buying and selling high-end cards, especially when you do it in a rising market like we're in now. And it's not like playing roulette; knowing what you're doing is definitely helpful. But it's very possible to lose money investing in cards, especially if you pay top dollar for a hot card near the top of the market. I know Luke made this point in the post I've quoted above, and I'm not trying to pick on Luke, just putting all this in terms used for other investments.

People have been making a living off of cards in all markets, not just the rising ones. In fact I would suggest the rising market we are in now is far riskier than previous times in the hobby. I have a business/finance background and I know I feel far more comfortable putting my money into cards than I do investing in a publicly traded company where I am a complete outsider and have no insight as to the way the company is really being run and which market makers are gonna dump the stock or load up before earnings. By the time the average investor gets news that they need to move out of a position it is too late. I do not see that same issue happening with cards.