General Musing recently
californiacards3
Posts: 1,015 ✭✭✭
Having been a financial professional my entire career, I thought I would pen a few musings for 2013.
1. Just completed a most excellent transaction with Probstein. 50 cards profitable successful, could have been a little more, but cards brought market. I hear lots of people talking about relative value and prices being too high. Like it not Ebay is the value creator outside the very high end items at auction houses. Ebay is like a clearing house it give you a good indication of retail value. Maybe uninformed, but it is a market and you should check your cards and your perceived value against recent trades. I go to shows all the time, and it appears that inventory can sit for long periods of time. In my financial experience, inventory needs to turn to produce cash. The museum pieces I see are incredible. At the Hunt Auction show in Valley Forge recently a guy tried to sell me a non gradeable 445 Tom Seaver for like $20 bucks, was he tree'd. DId he think I was stupid. There is a big disconnect. Especially by people trying to sell ungraded cards. The vast majority of my collection are sold ungraded cards that would likely garner a PSA 7 if I were to get them graded. Guys trying to sell me non graded cards as if they were PSA 8 or 9 are not going to get my business. You may not like inflated prices, but in finance and as a fiduiciary, you are obligated to create the most value for your shareholders, or investors. Similar in your own cards. The first thing I thought of when i got a PSA 10 1 of 1 was I would consign it to Probstein. High end value, more eyes, some perceived authenticity or safety in all of his feedback. Like it or not it is a fact. Why did I use Probstein. Well 20% approximate value creation (ie people bid his stuff up). More eyes more money in my pocket. With rare stuff I would consign nowhere else. If you don't like it don't bid. I usually don't because I feel I can pick up stuff cheaper and I am willing to wait, but as a seller it makes perfect sense. The auctions were loaded within 36 hours, and within a week, in fact within 5 hours of the last auction the money was in my Paypal account and I had an excel spreadsheet calculating all fees and my net take. That is what I call efficient and customer service focused.
2. Assymetric information is where money is made in all markets. That is not taking advantage of anyone it is just good business sense. As such, I try to always put myself at an information advantage in all of my investments and my hobbies. You need to be an informed buyer and and informed seller. However, it is not my obligation to inform you no matter what side I am on of your own uneducated position. I don't mean taking advantage of someone, I mean if someone is willing to pay retail for something I got a dealer price on better for me. As such, everyone on this board is always looking for the deal. However, we have some very educated and informed people on this board. So remember - Transparency is an illusory thing and often hard to find. For example, recently someone on these board was trying to sell a set they purchased on Ebay. They showed the price they paid for the set, then tried to turn around and sell it for a 100% profit. If the ebay trade was off market, so be it, but don't advertise how cheap you got something, then try to broker a trade at 100% profit. Most bid offers and "vig" whether in Vegas or Wall Street is in the 5-10% range. 100% is a little egregious.
3. The back and forth about shills, safety bids, etc is a fact at this point and outside some kind of regulation there is really nothing that can be done about it. It is then incumbent upon both buyers and sellers to be as educated as possible. Don't bid if you think the market is too high, bid like crazy when you think the market is cheap. Remember there is a difference between retail buyers and sellers of any product, wholesalers and dealers. Many of you on this board are strictly retail hobbiest, I have been lucky enough for several Nationals to be behind the ropes and buy pre-opening. That just is a smart thing to do. Am I a dealer no. Did I recently buy a solid 15,000 near mint card lot that was a good trade yes. But remember, sorting, grading etc take an awful lot of time and effort. Thus why bulk purchases are at 10-15% of market. If my 15,000 lot is any indication - maybe 3% of any near mint lot of pre 1976 material is investment grade - PSA Gradeable. Even if you think it is mint, if you have not put it under a 10X loupe you don't know what you are talking about.
4. I treat every trade in this hobby as if it were and investment. I have advised people, if you are going to spend (pick a number) over $10 $20 $50 for a card it should be looped and graded prior to you spending your money. Would you buy a shirt, suit or any other consumer product without making sure the quality is there.
I am done. Just felt like blogging a little
Regards
Barry
1. Just completed a most excellent transaction with Probstein. 50 cards profitable successful, could have been a little more, but cards brought market. I hear lots of people talking about relative value and prices being too high. Like it not Ebay is the value creator outside the very high end items at auction houses. Ebay is like a clearing house it give you a good indication of retail value. Maybe uninformed, but it is a market and you should check your cards and your perceived value against recent trades. I go to shows all the time, and it appears that inventory can sit for long periods of time. In my financial experience, inventory needs to turn to produce cash. The museum pieces I see are incredible. At the Hunt Auction show in Valley Forge recently a guy tried to sell me a non gradeable 445 Tom Seaver for like $20 bucks, was he tree'd. DId he think I was stupid. There is a big disconnect. Especially by people trying to sell ungraded cards. The vast majority of my collection are sold ungraded cards that would likely garner a PSA 7 if I were to get them graded. Guys trying to sell me non graded cards as if they were PSA 8 or 9 are not going to get my business. You may not like inflated prices, but in finance and as a fiduiciary, you are obligated to create the most value for your shareholders, or investors. Similar in your own cards. The first thing I thought of when i got a PSA 10 1 of 1 was I would consign it to Probstein. High end value, more eyes, some perceived authenticity or safety in all of his feedback. Like it or not it is a fact. Why did I use Probstein. Well 20% approximate value creation (ie people bid his stuff up). More eyes more money in my pocket. With rare stuff I would consign nowhere else. If you don't like it don't bid. I usually don't because I feel I can pick up stuff cheaper and I am willing to wait, but as a seller it makes perfect sense. The auctions were loaded within 36 hours, and within a week, in fact within 5 hours of the last auction the money was in my Paypal account and I had an excel spreadsheet calculating all fees and my net take. That is what I call efficient and customer service focused.
2. Assymetric information is where money is made in all markets. That is not taking advantage of anyone it is just good business sense. As such, I try to always put myself at an information advantage in all of my investments and my hobbies. You need to be an informed buyer and and informed seller. However, it is not my obligation to inform you no matter what side I am on of your own uneducated position. I don't mean taking advantage of someone, I mean if someone is willing to pay retail for something I got a dealer price on better for me. As such, everyone on this board is always looking for the deal. However, we have some very educated and informed people on this board. So remember - Transparency is an illusory thing and often hard to find. For example, recently someone on these board was trying to sell a set they purchased on Ebay. They showed the price they paid for the set, then tried to turn around and sell it for a 100% profit. If the ebay trade was off market, so be it, but don't advertise how cheap you got something, then try to broker a trade at 100% profit. Most bid offers and "vig" whether in Vegas or Wall Street is in the 5-10% range. 100% is a little egregious.
3. The back and forth about shills, safety bids, etc is a fact at this point and outside some kind of regulation there is really nothing that can be done about it. It is then incumbent upon both buyers and sellers to be as educated as possible. Don't bid if you think the market is too high, bid like crazy when you think the market is cheap. Remember there is a difference between retail buyers and sellers of any product, wholesalers and dealers. Many of you on this board are strictly retail hobbiest, I have been lucky enough for several Nationals to be behind the ropes and buy pre-opening. That just is a smart thing to do. Am I a dealer no. Did I recently buy a solid 15,000 near mint card lot that was a good trade yes. But remember, sorting, grading etc take an awful lot of time and effort. Thus why bulk purchases are at 10-15% of market. If my 15,000 lot is any indication - maybe 3% of any near mint lot of pre 1976 material is investment grade - PSA Gradeable. Even if you think it is mint, if you have not put it under a 10X loupe you don't know what you are talking about.
4. I treat every trade in this hobby as if it were and investment. I have advised people, if you are going to spend (pick a number) over $10 $20 $50 for a card it should be looped and graded prior to you spending your money. Would you buy a shirt, suit or any other consumer product without making sure the quality is there.
I am done. Just felt like blogging a little
Regards
Barry
0
Comments
<< <i>The first thing I thought of when i got a PSA 10 1 of 1 was I would consign it to Probstein. High end value, more eyes, some perceived authenticity or safety in all of his feedback. Like it or not it is a fact. >>
Hi fellow Barry,
I understand where you're coming from but would like to hear your thoughts on this thread regarding Rick Probstein (aka Probstein123):
http://forums.collectors.com/messageview.cfm?catid=11&threadid=876118
If he wants to maintain the perception his auctions are on the up-and-up, why is he avoiding that thread like the plague?
Otherwise, good blog entry.
Barry
<< <i>For example, recently someone on these board was trying to sell a set they purchased on Ebay. They showed the price they paid for the set, then tried to turn around and sell it for a 100% profit. If the ebay trade was off market, so be it, but don't advertise how cheap you got something, then try to broker a trade at 100% profit. Most bid offers and "vig" whether in Vegas or Wall Street is in the 5-10% range. 100% is a little egregious. >>
whether or not this individual divulged the info about his set purchase, it wouldn't be too difficult to find out, so there's your transparency.
in this case, i think it was a relative newcomer to the buy & flip game, though i could be wrong, but we've all been there, learning about how to operate on a level that allows us to profit or bolster collections.
some get better at it, most go back to whatever they were doing before while musing that it seemed like a good idea at the time.