Let’s put it this way, focus on the overarching direction not just the nuances. When the tide rises, it usually lifts all boats unless the boat itself is nonfunctional. This frequently happens in the stock market. When the market does well, many stocks do well, when it doesn’t, many stocks dips. The exceptions being companies that are viewed as having overwhelming unsystematic risks. What I am trying to say is, focus more on the substance behind the underlying asset and not just the form itself unless the form is abnormally broke like being a forgery or a fan-made set. Even the unlicensed products if from major brands, I think its not that bad if one is willing to accept the potential lower ROI multiplier.
I can’t say this enough. GOATs may change from time to time. Investing in a player because the player is the current GOAT is a losing proposition. The smarter move is to form a pipeline of inexpensive investments that may have high potentials on a periodic and continuously basis. Liquidity is king. You won’t have much bargaining powers if you are not liquid. You won’t be able to wait things out because they need cash flow. Being illiquid is an easy way to be taken advantage is. Even if someone is willing to buy something illiquid from you (smart investors will likely do research on your current financial and overall situation), you may have to sell your assets at heavy discounts. Part of having FU money is the ability to say no when saying no is advantageous to you. Not having the ability to do so may be detrimental to your financial well-being. This is precisely why I don’t recommend regular people to spend a large sum of money on illiquid assets that will hurt their cash flow significantly. What most people may not realize is momentum begets more momentum. When you are up and everyone sees it, people are likely to help you financially. When you are down, regular people will be hesitant to do so because their financial resources are limited and they can’t afford to gamble on you paying them back. The financial investors and institutions are likely even more stringent on the risk evaluation side.
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Which card sets should you buy?
Most regular people also do not know how to reduce risk through hedging or arbitraging. With alternative assets, it rarely is how much you spend, but rather, what is actually trending. There are so many high-end collector items that people paid for either never beat inflation nor opportunity costs or even lost nominal value. The other thing many people fail to grasp is there is no consensus definition of how much money one must have to be considered rich beyond certain common sense wealth ranges. For example, once reaching millionaire status, many regular people consider that as being either rich or well-to-do. Beyond that, most people couldn’t really objective say how much a difference a 10 millionairer is from a 50 millionairer. Why am I talking about this? Because investing frequently accompany risks. Some people go for the “home run” that has a high probability of failure because succeeding means creating “generational wealth.” The truth is generational wealth actually takes time to build some times in multiple generations. Going for the same home run that many others are going for frequently means a much higher failure rate. This is precisely why I almost never invest in anything over a 100 dollars for any single piece of item in the alternative assets market.
You could have easily 100X’d your money if you bought a Mario Pikachu box for $100 dollars a few years back. It doesn’t take a genius to figure out Pikachu and Mario are two of the hottest gaming/toy/entertainment related intellectual property/franchises in the world but obvious many people are far from geniuses hence many of these were likely hoarded by a select group of people and/or organizations. Look at Pikachu base set cards or any of the base set cards really. None of these cards are 1st Edition Base Set graded 10 Charizards but if you have many of these cards, chances are, they will likely appreciate within a given range over time with potential for even faster growth. Why? Because most of these were not retained in good conditions at high clips and the numbers are limited in the modern sense. No one will legally be able to make these cards ever again, even if they try, it will be extremely difficult to do so at scale. Mostly because WOTC likely can no longer have the license to make those WOTC Pokemon cards and neither The Pokemon Company nor Nintendo can likely make WOTC Pokemon cards. Put it this way, a 100 dollars worth of a 1st Edition Base Set Charizard might be hard to obtain for someone in 1999, but five shoe box full of common and uncommon non-holo cards from that set might have costed only 100 dollars in 1999.
In all honesty, that 100 dollar deal composing of 10,000 cards in decent condition might be worth more than even a certain graded 10 1st Edition Base Set Charizard card. Consider there are less than 200 copies of graded 10 Charizards from that set graded by certain popular grading company, I think the 100 dollars investment as mentioned above for 10,000 of cards from that set in 1999 was in essence a near low-risk investment in today’s terms. Point being, you don’t need to hit a home run to actually hit a home run. Some home runs are inside the park. The home runs are just runs, the difference is just the multiplier, records and the reaction from people. To a team that just need runs, home run is just an equation that converts to run(s). At the end of the day, 10 million or 50 million dollars does not change the fact that the person is considered to being rich by many regular people. Somethings follow economic patterns. When desktop computers first came out for mass use, they were quite large and quite expensive. Computers today are not only technologically advanced but exponentially cheaper overall from its first mass commercial release. Based on this, some people may say the smarter move is to invest all the money to buy a computer into mainstream US stock market index funds. Obviously from a historical standpoint that might have been a great investment. However, if one buys the computer early on but use it to create an early internet startup or an e-commerce website, the story may be a bit different and so will potentially return rates from the purchase. The difference in return rate is in how capital is being deployed rather than a set in stone economic formula.