Investment Potential

[mark evans]

I agree with Frank and ctown. I don't see how past performance provides any assurance of the future value of any particular card. Perhaps the closest to a sure thing, in my view, would be vintage (and preferably scarce)cards of players elected in the future to the Hall of Fame.

Mark

[sreader3]

Best investment: The sets Louchios and Spence will be starting next.

I can't agree with the statement that certain cards are "expensive" or "fully valued." Relative to what? The supply of vintage BB cards is nearly fixed, so prices should fluctuate with changes in demand. It's hard to say what will happen to demand in the next five years--or fifty years for that matter.

[ctownboy]

Things to consider;

1) Do NOT count on whales to continue to support the market. I would say there are very few of them around and all it takes is for a couple to stop collecting and sell their cards and prices will go down. This could happen because they lose their high paying jobs, their stock or real estate portfolios tank, they get sued and lose, they get divorced or they die and their heirs have no interest in the cards but HUGE interest in the cash they would generate when they are sold.

Also, from what I have heard of the whales, most are good or great in business but not all would be considered really interested in baseball itself. So, as long as cards in general (and certain cards in particular) continue to increase in value, these whales will still be interested in "collecting" and still want to own cards. However, if the T206 Wagner, or a lot of the lesser rarities start going down in value then these guys will start downsizing their collections.

If things start to snowball, some of the other whales will want out and they will sell their cards. Even if you are a whale, the idea of losing $1 million dollars (or more) on cards would be a tough pill to swallow.

If (when?) this happens, those whales who are more into "collecting" because of the possible monetary gains (and not the sport or cards themselves) sell their collections they will likely NOT return to cards but will go off into some other area to try and make money.

Less money chasing fewer cards means a downdraft for everything. If a rising tide raises all ships then the opposite is also true.

2) I was born in 1967 and grew up in a small town. My high school graduating class was about 160 people. Let's say half of those people were male. That is about 80 guys in my class.

When I was collecting cards around 1979 or 1980, I can remember at least 10 other guys in my own class who also collected cards. That is about 14% of all the guys in my 8th grade class who collected. That figure doesn't count guys who I didn't know collected cards, guys who occasionally bought some packs to open but who really didn't "collect" cards or ANY girls in my class who might have collected.

By the time I graduated, most of those guys didn't collect any more and I had bought a few of their collections. I seriously doubt if many of those guys ever started collecting again.

Now compare that to middle school children of today. How many of them are SERIOUS baseball (or other sports) card collectors? I bet very few are. I have four Nephews and a Niece who are between the ages of 7 and 18 and NONE of them collect cards.

My 18-year old Nephew used to collect Pokemon and Yu-Gi-Oh cards but he stopped doing that years ago. Now, he spends what extra money he has on video games and his car. He has ZERO interest in collecting baseball cards. The ONLY thing he is interested in, as far as my collection goes, is how much it would be worth if I sold it. Same goes for the other four.

I would say THAT is what a majority of kids are like today. Little or no interest in collecting cards or knowing about the history of baseball or the players but HUGE interest in how much these little pieces of artwork would be worth if sold.

Also, when you tell them that a certain card is valued at or could be sold for $300, they either 1) say they couldn't afford that card even if they wanted to collect ball cards or 2) (most likely) say that $300 dollars could buy them a game console and a few games or a cell phone and a calling plan.

So, with few kids collecting today and the prices so high on the older cards that entry is tough, the future of collecting doesn't look bright to me. Especially considering most everything is going digital and things actually made of paper are becoming fewer and far between.

Face it, newspaper circulation is decreasing because people are reading the news on their computers. Book sales are either decreasing or staying flat because people can either download a book off the web and onto their computers or use some other electronic means to buy and store a book. I imagine in 20 years or so, kids who want to collect "old" baseball cards will be doing so by gathering images on their electronic devices and storing their "collections" on a microchip instead of a shoe box or binder in their closet.

3) Just because a card is old and rare doesn't mean it is really valuable or that it is going to skyrocket in value. For example, I have 16 (out of a currently possible 73) Star Player Candy cards from 1928. Three of the players are Hall of Famers (but not Ruth, Gehrig or Cobb). I would say there are no more than five cards (if that) known for each of the cards I own. That would put them in the "old" and "rare" category.

Guess what? I would not even be close to being able to retire if I sold these cards. Because the cards are so rare and not very well known, nobody really is trying to complete a set. That means no whales competing against each other. The only real interest in these cards are as a type card or for a certain player for a certain reason.

If I wanted to sell these cards today, I would be lucky if the Hall of Famers sold for $1,000 each and the commons for $400 a piece. I have been offered $1,000 dollars for one common card because a guy collects that ONE player and NEEDS him. If this collector finds another 1928 SPC card of this player, interest in my card will drop to nearly zero.

I also have another common card which might reach $1,000 dollars but that is only because he is a Jewish player.

So, 16 "old" and "rare" cards that would sell for less than $10,000 dollars, combined. Good money but not anything to really write home about, as far as the whales are concerned and no real price spike in the forseeable future.

[barrysloate]

What's been touched upon and should be considered seriously is we are experiencing a generational shift in the baseball card collecting hobby. The baby boomers who spent most of their childhood collecting cards, and who were responsible for their renaissance, are getting older and are beginning to cash in. There's a new generation of hobbyists taking their place, but they did not grow up collecting cards and are probably smaller in number. I would be wary of looking at baseball cards today as purely an investment. Not saying they won't appreciate in value, but probably not anywhere near what we saw between say 1985 and 2005.

Why not simply build a nice collection of quality cards and memorabilia, and hopefully when the time comes to sell others also will recognize how nice it is. If you have a good eye and know how to buy desirable material, you probably will make some money on it in the long term. But don't expect to see the crazy price increases we've see seen during this past decade. That was as much a bubble as anything else.

[wpeters]

I started reading this board maybe 6 years ago and, after not having collected baseball cards in years, decided to buy some pre-war hall of famers. My collecting budget was very small and I bought mostly mid grade to lower grade cards. I bought tobacco, caramel, exhibits and strip cards along with Goudey and other regular issues. I did not pay over $75 for any card, and the vast majority of them were in the $30-50 range.

About two years ago I had to sell them and was shocked at what the prices were. I made just over 5 times what I had paid. I thought that was an incredible increase in just 4 years. I thought cards had reached their full value back then.

So my question is this, and it's a serious one:

What pre-war card hasn't increased in value in the last 6 years?

I'm sure there will be some exceptions, especially in the high grade market where only a few collectors determine a card's value. But, overall, I think the market for pre-war HOFers will continue to rise.

Walt

[Bill Stone]

I for one like to "invest" in a card that I can bring out of my desk draw, look at , and it makes me smile. If it goes up in value over the years that is an added bonus but if it brings me a daily smile it is priceless --there are a few T210 cards that I think would be wise investments.

[bosoxphan]

I don't think its dependent on the kids for atleast the next 50 years or so. Card collecting was huge in the 70's and 80's and those "kids" are just now entering their prime earning years. Those are the whales of the near future.

[Rich Klein]

"Face it, newspaper circulation is decreasing because people are reading the news on their computers. Book sales are either decreasing or staying flat because people can either download a book off the web and onto their computers or use some other electronic means to buy and store a book. I imagine in 20 years or so, kids who want to collect "old" baseball cards will be doing so by gathering images on their electronic devices and storing their "collections" on a microchip instead of a shoe box or binder in their closet."

Not only that; but music as well. When we were growing up you had to buy a record or a tape or a CD (depending on your age). NOW, all you need to do is listen on a computer OR use a device such as an IPod and download songs to that.

The need for "stuff" in today's world is much less than it was a few years ago.
Heck, yesterday Amazon.Com announced they sold more ebooks for the holiday season than they did physical books.

Rich

P.S. For "investing:" $5K in cards, I'd find the best condition cards available of the best players that you can. You won't get anywhere near a T206 Wagner but you could get a nice portfolio of a VG Goudey Ruth; A NM mid career Mantle; and a few other baubles. A very safe portfolio with little downside.

[Exhibitman]

I would dissuade him from investing blindly in cards. Just like any other form of investment cards require study and knowledge of the markets and issues. You wouldn't buy a bundle of mortgage loans blindly, right...ok, bad example.

[yanksfan09]

As a young collector (27), I too am uncertain about the long term investment potential of cards for the generational reasons previously stated. However, it seems to me that currently many people are uncertain for the long term investment potential in almost all areas (stocks, bonds etc...). There are many Geo-political, environmental etc... factors that have people uneasy.

Either way, I've been hooked on cards since I was about 8 years old and will collect them until I die, regardless of value/price.

For a 3-5 up to maybe 10 year investment I would feel comfortable staying with the true immortal/legendary players such as Ruth, Cobb, Gehrig, Wagner, Mantle etc.... I would stick with hitters as opposed to pitchers. A card of one of these type of players from their playing days is essential. Buy an attractive card and strive for a lesser seen issue, but it doesn't have to be exceedingly rare. And buy it in the best condition for the best price you can find. Be patient and wait for the right deal to come about.

[barrysloate]

Erick- it's certainly true we are living in an era where things change quickly and we never really know what to expect next. That makes it harder for us to make good choices whatever we are doing. I still maintain if you put together a quality collection of scarce cards, learn about them, keep adding to them over a long period of time, and have patience you will probably do fine and what you have will appreciate in value. But like others, I am leery of the idea of a 3-5 year investment portfolio. Those things don't always work out.

[mdschulze]

From reading these threads, it appears to me that there are 3 categories most baseball collectors fall into: 1) those who strictly "collect" to make money, 2) those who collect solely for the sake of loving cards, and 3) those who collect because they love cards but will also sell a few off if the prices are right.

I'm a category 2. Once a card is in my collection it will never leave as long as I have a say in the matter. Do I care what the cards are worth? A little, but if they were valued at zero I would still purchase cards for the sake of collecting. With that mindset, to me the values are secondary. I spend money on cards as if I were going to Vegas to play the slots. First, I only spend "extra" money. Second, if I spend $500 - $1000 and lose... it hurts but oh well! It's not like that was my retirement investments. Besides, the market will never drop to the point where you'll see T206 Cobbs going for $5.00. So unlike the slots in Vegas, your chances of going broke on cards is 0%. You will always be able to get something back for them

Also, as long as the miracle stories keep hitting the media like granny finding a card in her attic and trying to sell on Ebay for $10 when it's worth $50k or a 206 Wagner is bought at an estate sale for $1.00 then sold for $500k, I think the public will still be interested in baseball cards.