Investment strategies and why.

crsportscards33

Just wanted to get some opinions from some of the board on what they think will be the better long term investment. I'm not talking about reselling 3 years for now or anything. But if you were to buy some cards or even sets for your new child, which do you think would be the best way to go? Nice mid-grades of HOF'ers, nothing but high grade cards, or even sets? I truly enjoy the set registry and everything it has brought to the hobby. That being said, I'm not sure that the prices won't come down 20 years from now, as more and more cards are submitted. Just my opinion, now I want yours. Think for a 20 year investment, what do you think would be the best way to go?

jackstraw

i think HOFers is the way to go and i am not talking about the niekros and suttons. mays aaron clemente you get the picture. i have a hard time believing that a completely graded set that is 95% commons is going to send you kid to medical school 20 years from now. think about it drive by a ball field in the summer are there any kids playing baseball? no. go to your local convienance store any kids ripping packs shoving wads of gum in their mouth? no. once the 30 somethings become 50 somethings its lights out for this hobby!yeah there may be exception or two like early 1900's stuff and some 50 and 60's topps sets and the oddball stuff!i just don't see kids interested in this stuff a good investmant might be a tatoo parlor or a piercing pagoda in the mall? just kidding but i just don't see kids getting moved by pieces of cardboard? do you? i don't see a 12 year old now being a 22 year old adult wanting to complete a 2004 topps card set. 99% of this set registry and collecting are grown ups reliving their childhood sets that they collected. the other 1% are dealers preying on us
just my take on it. i am no financial advisor but i bet one would laugh if you told them about this registry thing

calleocho

bonds

Vargha

Real estate

onegaucho

Ditto what Vargha said. However, I'm guessing you meant cards. In that case, I'd stick with HOFers in PSA 7 or better condition. The earlier (and rarer) the card, the better.

joker73

Don't forget good ol' index funds .

Robert

Boopotts

Personally, I'd put my money in those issues which are the least likely to see a significant increase in the number of known mint examples. To this end, I'd recommend the '62 Topps sets (football or baseball, but mostly football) and '61 Fleer basketball, since I'll bet there aren't but a handful of mint-plus examples laying around in America's shoeboxes and attic footlockers. Same with anything pre-war; by 1980 the word was out on 'old' sportscards, so I think most of the real nice examples of '33 Goudeys, etc. have found their way into the hobby.

I'm in the minority, but I'd stay away from all post '60 issues, with a couple obvious exceptions ('68 3-D's, of course, as well as the aforementioned). They may 'seem' safe, but as John Basilone pointed out some time ago the prices for mint HOF's has dropped precipitously in the past 4 years, due in large part to an increase in the number of slabbed specimans. Who knows how many more mint '61 Mantles are out there? If even 10 more surface card's current value could be significantly compromised. If demand increases proportionately it won't be a problem, but that's a big if.

In sum: Buy issues that likely won't see a major increase in the mint+ population. If demand goes down your screwed, but then your screwed with any collectible if demand decreases. With the real condition sensitive stuff you're working with a buffer, since you get a sizeable return if demand increases, but should at least have a stable investment if demand levels off.

Griffins

Real Estate, Real Estate, and Real Estate. Low cost index funds might work as well, just don't pay a full service broker.
Save the cards for fun, then any return is a bonus.

AlanAllen

1. Slabbed wax
2. High grade superstar singles (non-RCs)
3. Anything 19th century

Joe

Tipem

While I agree with most on the board here,I think that crsportscards33 was looking for more in the line of cards.

crsportscards33,


I am a 50's man myself(baseball),but I think that probably the most bang for the buck will probably come from vintage football or regional sets.Probably even non-sports cards would also be a great investment.I am building sets from 50-59 in PSA 8 or better myself over the next 10 years or so as an investment.If I was going for investment only,I would take the route that I have suggested above but because I am a baseball guy,I am sticking with baseball primarily.I think that there is too much volitality with modern,even with the short printed auto cards and the game used cards.Maybe with the other sports,high grade super stars(HOF's) would always be a safe bet.


Vic

toppsgun

"Don't forget good ol' index funds"

Every index fund in America held Enron as it's 7th largest holding right up until the end. The S&P 500 includes a few dogs no one should own. Index funds, by definition are going to return the market average, minus 1/4 to 1/2 percent for fees, not including the trading commissions the fund manager pays. Never more than average.

You'd be better off buying an actively managed blue chip growth and income fund with a 20-year track record of beating the S&P. It's a pretty small universe, but they're out there.

The card craze of the 50's and 60's won't be repeated. Too much supply and too little demand.

70chip

IMO, From a purely return on investment angle, go with real estate!!!! They ain't making or finding no more dirt (in my best southern slang).....Stock Market/Mutual Funds over 20 years, of course, but choose wisely....nothing with a .com after it ; ).......Cards, too risky.....remember, to realize your profit's you have to find someone who will pay for it. Cards would be a neat thing for your child to grow up collecting and admiring, but by no way would I put all the eggs in that basket. Besides, you don't want that 57 Mantle being sold to fund that trip to Cancun for Spring Break!!

If you want to give you child a nice nest egg, Real Estate, yes....Market, yes....Cards, maybe a few. Tomorrow's adults are different than they were 20 years ago......It will be great if you do get some quality vintage/modern and get him hooked on the hobby, maybe then he will appreciate how beautiful some of the pieces are and cherish them more than "just" a piece of cardboard.

Don't mean to offend anyone, just my .02

Fuzz

Here's another two cents on the card angle.
My best bet would be ----- by the finds.
Once upon a time, 54 and 55 Bowman wax boxes were cheap. Now they are in high demand.
I bought a 59 Fleer box from a case for about $700 several years ago. Would like to have a shot at a few more of those. I think folks that bought 52 highs from the finds are happy and those that picked up 61 Fleer Bskt wax when it was available years ago are also very pleased. I even suspect that those 53 wax packs that are in the Mastro auction now will look like bargains in ten years.
Anything quality that shows up as a find. The larger available volume often depresses the price in the short term while the availability of nice material will often spur long term interest.
Good Luck,
Fuzz

ctsoxfan

Good topic. I was wondering the same thing recently, as I am working on a few registry sets and filling my closet with graded commons, where I used to concentrate only on HOF players and stars. I wonder if these graded sets will be worth anything down the road, as I knew I could always flip my star and rookie cards if necessary and get some money back. Mind you, I definitely am not in this for "investment", as there is really no such thing with cards. This is only a diversion, as jackstraw stated earlier, I am largely reliving my youth. Invest in something real, not sports cards.

NickM

Pick cards of HOFers that are tough to find in any grade. Example sets: '68 Topps 3D; Topps Venezuelans, '51 Topps Current All-Stars and Connie Mack All-Stars, Delong, George C. Miller, T205.

Nick

JasP24

Hall of Fame Football Rookies!!!

They are still THE most undervalued cards in the hobby..Compare them to baseball Hall of Fame rookies(most have a larger PSA population than football) and its pretty obvious. Add that to the fact that football is now the #1 sport in the U.S. by a large margin...

I caught on to this about 5 years ago, and my collection value has doubled, and maybe even tripled during that time...You can still find PSA 8 1957 Johnny Unitas rookie cards for under $1,000...As the football crowd(mostly born inthe 60's, 70's and 80's) gets older, the hobby will increasingly turn towards football...As far as population going up, its no secret that vintage football cards were produced in MUCH fewer numbers than baseball cards from the same era. Baseball was the king back then...

At this point, I would still consider starting a HOF Football collection as "getting in on the bottom floor".

Just my opinion of course, but the numbers dont lie...
Jason

Bearsnum34

one question what was the value of a 1952 mantle 15 years ago..last time I checked the one that sold for 250,000 was purchased for 8500.00 ...and which index, real estate investment had that return ?

helionaut

The best investments for long-term stability and growth potential I would have to say is anything but cards. Real estate is where I'd put my money if I had any, specifically undeveloped land in urban areas, or in outlying areas of growing cities. Cards are so uncertain in the future it's not really worth betting on. You could spend $38,000 on a PSA 8 52 Mantle today, which is one of the bluest chips in the hobby, but who's to say in 25 years what it's going to be worth? More than that, certainly, but is it the vehicle of best return for the investment? Think in 25 years what the collector base might look like. I don't think there will be 10% as many 30-year-olds collecting sportscards in 2029 as there are today. I would be surprised if major league baseball looks the same as it does today. The NHL isn't in good shape, and that could be gone. MLB isn't that great either, at least to hear the owners' sob stories (despite the fact that people are lining up to buy any team except the Expos), and with free agency, continued threat of removal of anti-trust status, declining revenues, the competitive gap, challenges to the draft, etc., there's a lot of problems to solve. If MLB does get a major contraction, which I think is inevitable (down to 20, 24 teams?), what does that do to the value of its memorabilia? And I don't think that the NFL and NBA will fill the void left in the same way, i.e. there won't be throngs of people competing for vintage cards from those sports. Certainly, there always will be buyers for the real gems, but the collector base will certainly be diminished.

So I'd say if you want to have cards be part of your portfolio, stick with the big Yankee four of Ruth, Gehrig, DiMaggio, and Mantle. Buy the best you can but buy wisely. You might look at other players, but stick with only the first tier HOFers, Johnson, Mathewson, Young, Cobb, and only in the major sets like T206, T205, 33 Goudey. Anson & Ginter or Mayo Cut Plug Ansons would probably be good as well, but be limited in your choices. If guys like Willie Mays, Ernie Banks, and Stan Musial aren't being bought on the same level as their Yankee contemporaries now, I don't think they ever will. Well, maybe Mays will get a reevaluation at some point, but that's a double-risk. That's about it. Anything involving common players, even PSA 10 1952 high numbers, I don't think are smart in a 20-year term. Your cards should be slabbed, of course, but having the grade on the slab be the major part of the value equation is not good.

Bearsnum34

Ok I didn't want to get into the real estate argument because this is what I do for a living...

but here are the arguments AGAINST real estate investing right now....

1) The real estate market is very top heavy right now..what I mean by this is the rates are low therefore a borrowers purchasing power is greater.. i.e. a borrower who makes 40K a year can afford (assuming normal debt levels) can afford a mortgage of approx 100,000 depending on property taxes, hazard insurance, mi (if there is any)...so because there are a number of buyers who are chasing homes the prices are exclating at a rate of approx 15% per year depending on the area of the country you live in...

also the "yield curve of a home" begins its regression after the 15th year because it has been proven (again timing is everything) that the newer homes have more advanced features, and are in greater demand therefore, the older homes do not and I repeat do not maintain the escalation they once did as they were younger.

thirdly, what about rates, It is a proven fact that as rates rise which they will... we saw evidence of this on friday with the jobs report, the number of home purchasers go down... higher rates eliminate buyers. so guess what happens with the home prices...can you say go down in value? don't beleive me, just check the houston, dallas, buffalo markets..they fell so fast and so much that people owed more on the homes than what they were worth...in fact for over 15 years you could not, I repeat you could not take out cash from your property in the state of texas..it was not allowed the only way to pull cash out of your property was a sale. Ok, so Buffalo, Indiana and other areas of the US have had 1.4% increases in the valuse of homes in the last 3 years..please feel free to check this thru fannie mae, or freedie mac, or hud, these results are readily available on the web site.

Ok, now what about rentals, well what about the fact that you need to pay for rent for the months that your rental is not occupied? You also have maintance costs, something breaks you need to fix it. At your cost. What about the costs of fixing up your rental when the previous renter moves out..new carpet, painting..things like that.

It is clear that while real estate can be affordable and make a wise investment, now is not the right time, we are approaching a bubble, all the signs are there as they were in 2000 with the nasdaq, very few beleived that was true but is yahoo 300.00 a share? redhat at 340.00, csco 156, qualcom 240, marketwatch.com...176..

If you want to make money in real estate you need 1 thing..location, location , location!!! or you find a home you can fix up after buying it for some sum of money below the value, put in approx 5-7K to fix it up, relist it sell it for a quick 20K profit...even trump will tell you all he did was buy various develpoments fix them up and resell a few years later for profit..what do you think popped all the S&L's years ago? Can you say real estate? They were so invested that when the valus popped so did they and the larger banks bought up the properties at 15 cents on the dollar and the government had to put out billions to bail them out..

Remember this final item..it costs approx 2-3% to get your money out of your property on a refinance ( if they advertise no-cost refi your paying thru the rate) and if you sell you will lose approx 3-7% depending on weather you use an agent or your buyer has one and closing costs..

I am not saying that a card is better or not, I feel a diversified portfolio is the best investment...real estate, stocks, bonds, collectables...they all have a place in ones overall protfolio..

toppsgun

"I am not saying that a card is better or not, I feel a diversified portfolio is the best investment...real estate, stocks, bonds, collectables...they all have a place in ones overall portfolio.. "

Agree, except for the bonds. Bonds at the bottom of the interest rate cycle is fool's gold.

I lean toward something kinda like this until one reaches retirement:

5% cash
15% collectibles
30% real estate
50% stocks

At retirement, swap out up to 25% stocks for bonds to supplement pension income.

Bearsnum34

w/ regards to bonds, I am refering to muni's, they are 100 % tax free and some have tax equivelint yields of 9%...

toppsgun

Muni bonds go down in value when interest rates go up. If one lives on the income and can hold until maturity, well, maybe. But liquidity can also be an issue with some muni bonds. Some are fairly thinly traded and you can get hosed on the spread.

Not all muni bond income is tax free. General Obligation bonds are, but higher yielding "project" bonds figure into ALT MIN tax. Also muni bond income adds into the calculation of whether Social Security is taxable for seniors. Nasty surprises await the unaware.

A 5.85% muni is equivalent to a 9% taxable in the top tax bracket, but such a high yielding bond is likely subject to potential ALT MIN.

OhioTaz

When is our friend W going to fix that AMT??

Greg

toppsgun

I'm hopin' for a National Retail Sales Tax myself. (No income tax, no cap.gains tax, no payroll tax, no estate tax.) Instead, 15-20% pay at the pump. There is a House bill and its got a couple dozen co-sponsors signed on. Dubya's seen it and likes it. Prolly need 60 senators on the right side of the aisle in the Senate to prevent a filibuster. Maybe by next summer we'll see it happen.

Everything you earn, you keep. Spend it and pay in the checkout line. April 15 becomes just another day.

WinPitcher

As much as i agree with that in theory, we will never ever see it.

its just too simple

edited to add a comma

Wabittwax

I definately do not think that rare high grade vintage cards will drop in value in 20 years. The market has already reached the point that new PSA 9's from the 50's are really really tough to find. Populations on the cards are pretty stable and the demand is still there. In 20 years the cards will only be older and scarcer. Definatley a good long term investment, imo.

Bearsnum34

topps,

muni's should be held as a portion of a portfolio, never as a straight investment soley, too much money in one investment always sets one up for a big loss, I'll take the 5% muni return while my other investments work for me gaining value...just think you wake up one morning before the market opens and you turn on the news and low and behold some idoit hijacked a plane and ran it into the world trade center, the market opens limit down, you cant sell your stocks cause they gap lower on the open and when they open for trading they are 5-10 lower...but I mean it would be carzy to think that anything like that would ever happen...right?