[Part 3 of 3] The collectible card game that quietly outperforms stocks and real estate
Part 3: Before you invest
In Part 1 and Part 2 of this series, we discussed why you might want to consider adding Magic: The Gathering trading cards to your investment portfolio. But first, there are a few things you should think about before diving into alternative assets, and Magic cards in particular.
1. Do collectibles fit with your lifestyle?
Care and maintenance: Assets can lose their value if they get lost or damaged. You’ll want to store high-value cards in a secure, light- and humidity-controlled environment, such as a safe. Luckily, cards don’t take up a lot of space so they’re much easier to store than, say, a classic car. Depending on the value of your cards, you should also consider getting insurance.
Buying and selling: Every transaction will likely be higher-maintenance than investing in the stock market, but not as long and involved as real estate. Still, not everyone enjoys the hunt or the hustle of buying and selling on eBay. It does take work, and time. You could get someone else to do it for you, but you’ll probably be paying service fees.
2. Do collectibles fit with your investment style?
Liquidity: Obviously, Magic cards are not as liquid as stocks. But if you’re okay with handling the buying/selling process, they’re much more liquid than real estate and many other tangible assets. We’ve mentioned the huge and growing market size, and the healthy secondary and tertiary markets. There’s always going to be someone as passionate as you, who wants to buy.
Limited pricing data: A majority of Magic cards have historically been traded through private sales, so publicly available pricing and provenance data is limited. There are companies working on making data more accessible as this category grows and matures, but until then you’ll have to be comfortable doing research with the data that’s available.
Things to watch out for
Counterfeiting: This has been known to happen even at prestigious auction houses. If you’re planning to invest in expensive Magic cards, look for ones that have been authenticated and graded by a third party like Beckett Grading Services or Professional Sports Authenticator. Grading also helps set a benchmark for properly appraising the card.
Sleazy sharks / Hype machines / etc.: Basically all we’re saying is… Do your research! Research the asset and its seller before you plop down your hundos. Don’t go all crazy and spend more than your finances can handle.
Getting started the easy way
Not quite ready to go all in, or more of a low-maintenance guy/gal? We’ve got you. If you don’t want to deal with the worry of maintenance, don’t have the funds to make a large acquisition outright, or want a more liquid option, Mythic Markets specializes in fractional ownership of pop culture collectibles.
We’re launching with an Alpha Black Lotus and other MTG assets, which we’ll be announcing as they hit the marketplace. Sign up to stay up to date on new offerings and opportunities!