Heritage Auctions - Boston Garters

[Snowman]

Originally Posted by Peter_Spaeth

It's worse than that, you'd be bidding against yourself. Every bid you make on an individual lot drives up the aggregate price, requiring a higher set price to beat it. It makes zero sense.

While it may seem like you'd be bidding against yourself by bidding on both sides, the math doesn't actually work out that way. The game theory optimal strategy here would be to focus on the individual lots first, and to ensure participation in the set lot as a backup plan, since the individual lots should be the favorite to win out. You're not effectively bidding against yourself because you only bid on one side of the auction unless two or more bidders overtake you on the other side, in which case *they* are the ones who bid you up, not yourself, as they have rendered your losing bids on the other side irrelevant. You never bid up both sides at the same time. You only switch sides if forced to. You will still have to overtake all bidders on both sides regardless if you intend to win. A single competitive bidder on one side cannot overtake you if you control the other side unless the two sides are in a dead heat already, in which case you'd still have to overtake him regardless of which side he is on, and you'd be bidding against him, not yourself. And if a single competitive bidder bids against you on both sides, then it doesn't matter which side he chooses as the decision is arbitrary and you have to overtake him either way.

[Peter_Spaeth]

Originally Posted by Snowman

While it may seem like you'd be bidding against yourself by bidding on both sides, the math doesn't actually work out that way. The game theory optimal strategy here would be to focus on the individual lots first, and to ensure participation in the set lot as a backup plan, since the individual lots should be the favorite to win out. You're not effectively bidding against yourself because you only bid on one side of the auction unless two or more bidders overtake you on the other side, in which case *they* are the ones who bid you up, not yourself, as they have rendered your losing bids on the other side irrelevant. You never bid up both sides at the same time. You only switch sides if forced to. You will still have to overtake all bidders on both sides regardless if you intend to win. A single competitive bidder on one side cannot overtake you if you control the other side unless the two sides are in a dead heat already, in which case you'd still have to overtake him regardless of which side he is on, and you'd be bidding against him, not yourself. And if a single competitive bidder bids against you on both sides, then it doesn't matter which side he chooses as the decision is arbitrary and you have to overtake him either way.

Suppose lete in the bidding there's just one or two lots where it's obvious another bidder really wants them and would go to the moon to get them. You really want the set so abandon the plan to win all individual lots and chase the set. Suppose too nobody else would have bid higher on the other individual lots on which you are now high. At that point aren't all your other bids built into the set price you now have to beat? Wouldn't you have done better just to chase the set from the get go?

[atx840]

I am by far not a data scientist, but I would think it would be in the best interest of the bidder on the whole set to have the individual lots stay as low as possible.

I think both sides should be allowed to increase their own bid during extended bidding.

• The aggregate price goes higher than the high set bid. This notifies everyone who is bidding, including the set bidder.
• The set bidder increases their bid and they are now the high bidder.
• Then it is up to the collective group of individual bidders to bid up the cards, or if they are high bidder to pay a bit more to win their card or loose it.
• The bidders on the individual lots increase their bids, maybe some don't and either they top the set bid or they all loose out.

This gives the advantage to the bidder on the full set as their bid increase can guarantee high bid, however that increase is a much larger amount than what each individual bidder would have to come up with.

[Peter_Spaeth]

I'm not a data scientist either but it seems counterintuitive to me that the best strategy is to try to win 12 lots rather than trying to win one.

[tiger8mush]

Originally Posted by Peter_Spaeth

I'm not a data scientist either but it seems counterintuitive to me that the best strategy is to try to win 12 lots rather than trying to win one.

I believe most would agree with you. But given the format parameters* of this particular auction, it was the only way one could guarantee winning all 12 cards (since there wasn't enough activity on the full set auction). Otherwise you are taking a risk.

*
- Cannot raise your own bid if you are already high bidder
- Each of the 13 lots end individually
- winner of 12 cards based on higher closing price of individual lots vs set.

[oldjudge]

I feel fairly certain that one call to HA would have allowed a high aggregate bidder to raise his own bid if he was locked out by the system.

[trambo]

Originally Posted by Peter_Spaeth

I'm not a data scientist either but it seems counterintuitive to me that the best strategy is to try to win 12 lots rather than trying to win one.

...but after reading this thread for the past few days, I kinda sorta want to be a data scientist!? haha

Great read and I hadn't really had anything to add to the discussion (and still don't except to joke as I just did). So I lurked.....

Sorry it worked out the way it did for Powell! If you're still reading, Powell, I do have a few cards from your t206 set that was at the DIA in my set now. They're noted so in 20-30 years when it's time for me to sell it, I can let the buyer know where it came from before me. Great knowing a small part of my t206 set came from yours!

Troy Rambo

[Edward1994]

Sad how this worked out, but very classy by everyone on here. I think letting the results stand was probably the only real choice, but how sad for Powell as he did nothing wrong, and in good faith thought he was winning.

[Snowman]

Originally Posted by Peter_Spaeth

I'm not a data scientist either but it seems counterintuitive to me that the best strategy is to try to win 12 lots rather than trying to win one.

Bidding on the set only gives you the opportunity to win the set for less than you might otherwise have to pay were you to bid on all lots, but it also places you at risk of losing altogether since in this format, you get shut out without another set bidder to compete against. So it is optimal in the sense that it is the most likely route to the cheapest win, but it is non optimal if the goal is to guarantee a win, which it cannot do. The only way to guarantee a win is to bid on all lots on both sides like playing a game of Whack-a-Mole.

[Edward1994]

Originally Posted by Snowman

Bidding on the set only gives you the opportunity to win the set for less than you might otherwise have to pay were you to bid on all lots, but it also places you at risk of losing altogether since in this format, you get shut out without another set bidder to compete against. So it is optimal in the sense that it is the most likely route to the cheapest win, but it is non optimal if the goal is to guarantee a win, which it cannot do. The only way to guarantee a win is to bid on all lots on both sides like playing a game of Whack-a-Mole.

Thats the part that confused me. Why didn't anyone think about that before hand? From my limited experience, it seems most auctions you need someone else to bid against you to raise your bid. Wasn't it obvious there was a huge risk that it wouldn't be possible to win the set if there was only one bidder? Therefore you would have to bid on every card to make sure you won

[Casey2296]

Originally Posted by Edward1994

Thats the part that confused me. Why didn't anyone think about that before hand? From my limited experience, it seems most auctions you need someone else to bid against you to raise your bid. Wasn't it obvious there was a huge risk that it wouldn't be possible to win the set if there was only one bidder? Therefore you would have to bid on every card to make sure you won

Then why even have a set option? Michael pointed out how easy it is to run both fairly in an auction in a previous post, it makes no sense how one of the biggest AH would screw it up so badly with their format.

[Aquarian Sports Cards]

Originally Posted by Edward1994

Thats the part that confused me. Why didn't anyone think about that before hand? From my limited experience, it seems most auctions you need someone else to bid against you to raise your bid. Wasn't it obvious there was a huge risk that it wouldn't be possible to win the set if there was only one bidder? Therefore you would have to bid on every card to make sure you won

Because there's no way the set should've closed while the individual lots were still open. That has NEVER been how this style of auction has run before. So no, it shouldn't have been obvious.

[mordecaibrown]

[QUOTE=Snowman;2378396]Bidding on the set only gives you the opportunity to win the set for less than you might otherwise have to pay were you to bid on all lots,

Explain to me how this is true? I must not be understanding something.

The set price cannot win if it’s less than aggregate of individual lots, so how could you win the set lot at a price lower than you’d could win the summation of each individual lot?

Based on how this auction was run, I have no idea on the purpose of the set lot ever being offered. What was the purpose?

[Snowman]

[QUOTE=mordecaibrown;2378408]

Originally Posted by Snowman

Bidding on the set only gives you the opportunity to win the set for less than you might otherwise have to pay were you to bid on all lots,

Explain to me how this is true? I must not be understanding something.

The set price cannot win if it’s less than aggregate of individual lots, so how could you win the set lot at a price lower than you’d could win the summation of each individual lot?

Based on how this auction was run, I have no idea on the purpose of the set lot ever being offered. What was the purpose?

If you can successfully shut out the bidders on the individual side by not bidding against them, and them not otherwise having enough action to overtake the full set bid, then you can win it for less if your full set high bid amount is less than the sum of the individual lots plus whatever it would take for you to take the high bid on each of those lots. This is why you only bid on one side at a time, and why you only switch sides when forced to by the other bidders.

[doug.goodman]

Originally Posted by Snowman

Bidding on the set only gives you the opportunity to win the set for less than you might otherwise have to pay were you to bid on all lots, but it also places you at risk of losing altogether since in this format, you get shut out without another set bidder to compete against. So it is optimal in the sense that it is the most likely route to the cheapest win, but it is non optimal if the goal is to guarantee a win, which it cannot do. The only way to guarantee a win is to bid on all lots on both sides like playing a game of Whack-a-Mole.

Which is why, as I said in my initial post, "The aggregate total of the single lots should have been treated as another bidder in the full set auction, with the time on the full set auction not ending until no bids had been placed for 30 minutes on any of the individual or full auctions."

[Snowman]

Originally Posted by Peter_Spaeth

Suppose lete in the bidding there's just one or two lots where it's obvious another bidder really wants them and would go to the moon to get them. You really want the set so abandon the plan to win all individual lots and chase the set. Suppose too nobody else would have bid higher on the other individual lots on which you are now high. At that point aren't all your other bids built into the set price you now have to beat? Wouldn't you have done better just to chase the set from the get go?

This would be another example of why you need to control both sides of the auction. You can't know ahead of time which side might have that one guy that is willing to go to the moon, but if you can continue to bid on the other side, you can shut him out as long as you have enough competition on the other side to overtake him. But if there's no competition on that other side, then you won't have that option available to you, and you'd have to take him on head to head. Basically, you have to be willing to take on all bidders on both sides in order to guarantee a win. You can switch which sides you bet on, but you only switch sides due to action by other bidders forcing you to switch, not by your own action on the other side. Because if your action on the other side is sufficient to overtake, you won't need to bid again. You're always overtaking someone else, never yourself.

Honestly, it's a non optional strategy for the auction house to run it this way. It almost ensures the hammer price is less than if it had been individual lots only. Especially for something easily trackable like a set of 12 cards.

[Peter_Spaeth]

Originally Posted by Snowman

This would be another example of why you need to control both sides of the auction. You can't know ahead of time which side might have that one guy that is willing to go to the moon, but if you can continue to bid on the other side, you can shut him out as long as you have enough competition on the other side to overtake him. But if there's no competition on that other side, then you won't have that option available to you, and you'd have to take him on head to head. Basically, you have to be willing to take on all bidders on both sides in order to guarantee a win. You can switch which sides you bet on, but you only switch sides due to action by other bidders forcing you to switch, not by your own action on the other side. Because if your action on the other side is sufficient to overtake, you won't need to bid again. You're always overtaking someone else, never yourself.

Honestly, it's a non optional strategy for the auction house to run it this way. It almost ensures the hammer price is less than if it had been individual lots only. Especially for something easily trackable like a set of 12 cards.

The last point is interesting. Is that because there are guys like Powell who just bid on the set side who otherwise would be pumping up the individual lots in an effort to win them all?

[Snowman]

Originally Posted by Peter_Spaeth

The last point is interesting. Is that because there are guys like Powell who just bid on the set side who otherwise would be pumping up the individual lots in an effort to win them all?

Yes, exactly. It doesn't benefit the consigner at all, in this case, to offer the set separately. It can only hurt them because all competitive set buyers would still bid their maximums in aggregate across the 12 lots, but they could get shut out if they only bid on one side and run out of competition on their side to keep them in the running with the other side.

In practice, it's more a convenience to set bidders than it is a bid maximization tool for the consigners, at least with a set this small where bidding both sides is easy to manage. If it were 1952 Topps, then ensuring you are the high bidder on each individual lot is much more challenging, and would result in most set bidders not wanting to bid that way. So offering both makes some sense there because it's very unlikely you're getting bidders to try to win every single lot otherwise. But in that case, you'd definitely want to allow set bidders to outbid the aggregate singles lots even if there is only one set bidder remaining. This allowance would make the "bid both sides" strategy pointless, and should have been implemented in this auction. But it wasn't. Hence the need to bid both sides.

[benjulmag]

Originally Posted by Snowman

Yes, exactly. It doesn't benefit the consigner at all, in this case, to offer the set separately. It can only hurt them because all competitive set buyers would still bid their maximums in aggregate across the 12 lots, but they could get shut out if they only bid on one side and run out of competition on their side to keep them in the running with the other side.

In practice, it's more a convenience to set bidders than it is a bid maximization tool for the consigners, at least with a set this small where bidding both sides is easy to manage. If it were 1952 Topps, then ensuring you are the high bidder on each individual lot is much more challenging, and would result in most set bidders not wanting to bid that way. So offering both makes some sense there because it's very unlikely you're getting bidders to try to win every single lot otherwise. But in that case, you'd definitely want to allow set bidders to outbid the aggregate singles lots even if there is only one set bidder remaining. This allowance would make the "bid both sides" strategy pointless, and should have been implemented in this auction. But it wasn't. Hence the need to bid both sides.

Even for a set this small, it can be more than just a convenience to set bidders to allow them to bid on the set as an individual lot; it can be the prerequisite to bid at all. And I'll take my case in this auction to make the point. I bid on only the set, and if not allowed to do that, I would not have bid at all. To me it was all or none; if I could not have the full set, I was not interested. I had a limit in my mind as to how high I would go. Think now about the alternative I would have been faced with if I had to bid on the cards individually. In order to remain high bidder on each individual card to remain in the running to win all 12, I could have been forced to raise my bid on an individual card to remain high bidder on that card, but by so doing I would exceed my limit for the set. And if I didn't raise it, I could end up winning all the other cards in the set. Either situation would not work for me, and as a result I would not bid at all.

To go further, besides the advantage offering the set as an individual lot offers to a bidder such as me, it has no down-side to the consigner. It brings more bidders in (in this example, me) thus creating the possibility for the aggregate of the 12 cards to be higher than it would otherwise be. And if done properly, no bidder on an individual card would run out of competition because once he saw that the set price exceeded the total of the individual cards, the effect was he had been outbid on that card and would have known he had to raise his bid. And that is exactly what we saw here. Powell stated that if allowed to, he would have raised his bid, and depending on how high he was willing to go, could have raised the set price to a level that exceeded what the individual cards ended up selling for, thereby netting more for the consigner. And if the cycle repeated itself, more money would flow to the consigner.

[jayshum]

Most of the focus has been on the full set lot closing so Powell couldn't raise his bid on it once the total of the individual lots went above it, but even if the lot stayed open, he may not have been able to raise his bid because he was bidding against himself.

Wouldn't the same thing have happened with the individual lots? If the high bid for the total set lot had been higher then the combined total of the individual lots, if someone was the high bidder on one of the individual lots and wanted to increase their bid so the individual lots total was higher, they probably wouldn't have been able to either because they would also be bidding against themselves.

I've never bid in auctions like this but several have commented about other AHs running similar types of auctions. Apparently, those have had all the lots linked together to show whether the set or the individual lots were ahead and everything stayed open until none of the lots had bids for a period of time, but how did they handle the issue of a current high bidder increasing their bid on an individual lot or the total set lot to change which side was winning? Were bidders able to increase their own high bid or did they have to talk to someone at the AH to get it done for them?