How much are you "into it"? Should it matter....

[Fred]

I would think that most people would not consider discounting a card just because they attained it at a much lower price. If a card was purchased at a much lower price, then the seller has to negotiate in the sale of the card.

If the buyer is a known flipper, then I'd make sure they got the good guy discount of about 0% because if they're willing to pay full bore on a card, then they're probably looking to flip it for more.

Perhaps one reason to discount the card would be to help out a fellow collector that could really use the card. But it would be disappointing to see that fellow collector sell the card shortly after claiming they wanted it for their collection.

[nat]

"how much should the price $ you paid for/acquired a card influence your flexibility on price when selling it?"

None. To think otherwise is the Sunk Cost Fallacy. The basic idea is that money that you've spent is gone, and irrelevant to the current value of something. If you paid $X for something, and it's now worth $(X - Y), that you paid more for it than its currently worth doesn't make a difference to what its currently worth.

The inverse of all this is that the fact that you got a deal on a card shouldn't lead you to sell it for less than you would otherwise.

It's probably not a good idea to think of yourself as having made a loss or a profit on any given card. Since the money that you used to buy the card is gone, the only question that you face is "how can I maximize what this card sells for now?". And that price might end up being higher or lower than you bought it for.

Now, it probably is a good idea to ask if you're making money selling cards in general (if not, you might want to stop), but it doesn't make sense on any given transaction.

Of course, people fall for the sunk cost fallacy all the time. So it wouldn't surprise me if folks do take this into consideration. But the question was about what one ought to do, and it's not rational to take retrospective costs into consideration when making decisions.

[Hankphenom]

I can't imagine a dealer who hasn't taken what he paid for something into consideration when negotiating to sell an item that's been sitting for awhile. For buyers, why should it mean anything? All it is ever does for me as a buyer is to trust the dealer a little less--of all the reasons you might come up with to price something at a certain point, it's the one I'm the least interested in, in fact I have no interest at all.

[rjackson44]

Remember going to gloria show in white plains years ago.I took a buddy and i bought three t206 hal chase holding trophy ,,when going home i asked why he didnt buy anything?He said he only had $75 and with a wife and two kids it was hard.His dream card was that chase he admired it.When i dropped him off i said you dropped something on the car floor.It was the chase psa 3.till this day he still owns that card .And were still pals ..priceless.

[sportsnut25]

Originally Posted by rjackson44

Remember going to gloria show in white plains years ago.I took a buddy and i bought three t206 hal chase holding trophy ,,when going home i asked why he didnt buy anything?He said he only had $75 and with a wife and two kids it was hard.His dream card was that chase he admired it.When i dropped him off i said you dropped something on the car floor.It was the chase psa 3.till this day he still owns that card .And were still pals ..priceless.

Love this - props to you.

[bounce]

cost basis should never factor into the decision.

all that matters to me is:
1) current market
2) my evaluation of potential appreciation over next 12 months at most
3) opportunity cost if I keep this card over what I think I could do with the cash
4) how much do I really love the card, because if I really love it who cares about value?

takes a lot of work to get to this point, but it's worked for me

[Exhibitman]

Sometimes a sale isn't the way to go at all. Shortly after the Great Recession I was approached by a fellow collector who wanted to buy a marquee-type card that I'd bought at the height of the market. Rare card and mine was in peak condition. My card was probably worth 20% of what I'd paid for it because I got auction fever and went after it hard. We negotiated fruitlessly for a while; I wasn't ready to take a loss of that magnitude. Eventually, we decided that we were both in the same place: he had a ton of stuff he'd bought at the peak and was at a huge loss on too. We ended up trading losses instead. Worked out great for both of us.

[Fred]

Originally Posted by Hankphenom

I can't imagine a dealer who hasn't taken what he paid for something into consideration when negotiating to sell an item that's been sitting for awhile. For buyers, why should it mean anything? All it is ever does for me as a buyer is to trust the dealer a little less--of all the reasons you might come up with to price something at a certain point, it's the one I'm the least interested in, in fact I have no interest at all.

Absolutely agree with that.

A couple years ago I saw a card for sale that I wanted. It was the same card that I saw sold within the same year. I picked it up for over $500 for less than the seller purchased it for.

I asked the seller what gives and he just said that they really wanted the card at the time and at the time of the sale, he just wanted out of it. I'm pretty sure the seller could have held off for a little more time to at least break even on the transaction. I guess that was just being in the right place at the right time.

In this case I knew the seller was going to take a loss on the card and I was fortunate/happy to buy the card.

[mintacular]

Originally Posted by nat

"how much should the price $ you paid for/acquired a card influence your flexibility on price when selling it?"

None. To think otherwise is the Sunk Cost Fallacy. The basic idea is that money that you've spent is gone, and irrelevant to the current value of something. If you paid $X for something, and it's now worth $(X - Y), that you paid more for it than its currently worth doesn't make a difference to what its currently worth.

The inverse of all this is that the fact that you got a deal on a card shouldn't lead you to sell it for less than you would otherwise.

It's probably not a good idea to think of yourself as having made a loss or a profit on any given card. Since the money that you used to buy the card is gone, the only question that you face is "how can I maximize what this card sells for now?". And that price might end up being higher or lower than you bought it for.

Now, it probably is a good idea to ask if you're making money selling cards in general (if not, you might want to stop), but it doesn't make sense on any given transaction.

Of course, people fall for the sunk cost fallacy all the time. So it wouldn't surprise me if folks do take this into consideration. But the question was about what one ought to do, and it's not rational to take retrospective costs into consideration when making decisions.

I find this interesting. If we as sellers were robots we should apply this theory. But we are not. Would you say the more successful dealer is able to put emotion aside including what they are into a card and just stay firm and charge the higher amount? Can you mentally just push aside the original purchase price? Easier said than done

[nat]

Originally Posted by mintacular

I find this interesting. If we as sellers were robots we should apply this theory. But we are not. Would you say the more successful dealer is able to put emotion aside including what they are into a card and just stay firm and charge the higher amount? Can you mentally just push aside the original purchase price? Easier said than done

The last line of my post said "of course people fall for the sunk cost fallacy all the time". People are emotional and not merely rational. But someone who ignores what they paid for something when they go to sell it will, in the long run, make more money than someone who takes it into consideration.

[mintacular]

Originally Posted by nat

The last line of my post said "of course people fall for the sunk cost fallacy all the time". People are emotional and not merely rational. But someone who ignores what they paid for something when they go to sell it will, in the long run, make more money than someone who takes it into consideration.

Thank you sir

[JollyElm]

There needs to be a lot more subtlety and nuance involved in this type of discussion.

Granted, there will be people who overpaid or whatever for a card, and won't budge from their selling price because they have more into it than you are offering. Happens everyday, and it's easy to be annoyed by them. But sometimes other factors come into play, too.

1. Say I got a good deal on an expensive card and was able to buy it for less than it was going for at the time. If we had a time machine and went back to that day, people would say, "Wow, you did good!" So it's important to note that I didn't overpay or make a mistake at the time of purchase. Fast forward a year, and now the same card is selling much more cheaply. If someone offered me the 'new' going rate, my first thought would be that I spent more on it than that. It's human nature to not want to take a big loss on something. That's how the mind works, independent of the market. So instead of selling it at a 'bad-for-me' price, I'd rather hold onto it and hope the heck the price starts going back up again. And right now, with card prices skyrocketing, that is a smart thing to do.

2. I don't generally sell anything, as I much rather trade, but sold a couple of cards recently. And that went fine. But, when I had a 'for trade or for sale' thread going with a 1961 high number Mantle, it just got ridiculous. The offers I got were not only literally lower than what I paid for the card, but also weren't anywhere near what cards in the same grade had sold for in the past half a year or so. And do I even have to mention how Mantle cards are always climbing? So, if I said, "No, sorry. I'm into it for more than that." Am I the bad guy??? No freakin' way. Plus, these people would angrily say, "I can get that card any day of the week for X amount!" And my reply, of course, was, "Good for you. So why are you wasting your time with me? Go buy as many of them as you can at that price."

So, it's not a black and white issue. The pendulum swings both ways.