If you spend enough time in any business industry, financial patterns begin to emerge and become apparent. The longer you are in the industry the more patterns you will see develop. Making sense of investing patterns in the trading card industry is easy, if you pay attention to a few key mitigating factors, such as the popularity era of the sport you collect, the manufacturing quantities produced of the brand of cards you collect, and the historic market increases and decreases in the years you collect. Understanding these three factors when purchasing and selling your precious cardboard gold, may help move your fun collectable hobby into a potential investment opportunity.
Why do we collect trading cards? Hopefully, for the fun and fulfillment it brings to our lives. Therefore, collecting needs to be fun and needs to stay fun. Over-analyzing the investment possibilities may take away from that enjoyment. However, if done in balance, it is possible to achieve both an entertaining hobby and add an additional investment to one’s portfolio.
“How popular was the sport in the era I am collecting?” Understanding how to answer this question before buying or selling your cards allows you to understand the first financial pattern of collecting trading cards. For example, let’s use the nineteen fifties’ and nineteen sixties’ basketball era to help understand sports popularity era though trading card patterns. In the nineteen fifties, there was only one major manufacturer of basketball cards who produced cards and only one year in ten that they produced them…Topps, in 1957/58. Since the baseball card era of the nineteen fifties had more than one manufacturer, and baseball cards were produced for each of the ten years in that decade, we can surmise from this that basketball in the nineteen fifties was not as popular as baseball. If we move into the nineteen sixties era, we find the same scenario with basketball cards, as compared to baseball cards. Again, there was only one major manufacturer for that decade for basketball, Topps, and they only produced basketball cards for two years, 1968/69 and 1969/70. This can be compared to baseball cards, which again, had two major manufacturers producing trading cards for each of the ten years in that decade.
Trading card manufacturers do not release production numbers the majority of the time; however, understanding these popularity era trends, a collector can obtain enough information to make educated decisions when determining prices to be paid in buying or selling their cards. From our vintage basketball example, we can come to the conclusion that the production numbers printed of basketball cards would be much less than those of baseball, directly due to calculations of supply and demand that manufacturers use when determining how many of a product they want to produce. This moves us into our second financial market pattern that works in conjunction with sports popularity. What are the manufacturing quantities produced for the cards you are collecting?
How can we convert the knowledge we obtained, from understanding sport popularity and the manufacturing quantities produced, into our decision making process used when purchasing and selling sports cards as an investment? In our example of collecting basketball vintage cards, we understand without having production numbers from the manufacturer, that there should be far fewer basketball cards produced from earlier eras because the sport was not as popular compared to baseball. This is due to the lack of companies that produced basketball cards over the years. We can also conclude that since basketball card manufacturers’ production numbers are lower for these eras, that the quantities for high-grade basketball cards should be much lower, also due to the lack of interest in basketball trading card collecting during those eras. If the future interest of basketball trading cards increases, and new collectors move into vintage trading cards, the demand should supersede the supply. If you understand how markets work, it becomes evident that price increases need to occur in order to offset the demands need of lower supply availability.
Understanding historic market increases and decreases in the sport trading card industry can also be used in your investment strategy when purchasing and selling trading cards. To keep this concept simple, investors should do one thing: buy low and sell high. Trading cards is a market, the same as any other market in the general sense. When more people are selling than buying, a true investor is buying. And when more people are buying than selling, a true investor is selling. Markets go up and down, and investors are aware of these trends and take advantage when increasing or decreasing their inventories. Let’s take baseball card eras as an example. In the nineteen eighties, baseball cards was at a market peak for vintage nineteen fifties’ and nineteen sixties’ era baseball cards. Most collectors were targeting vintage cards from those two eras. The 1970’s trading cards were not popular but there was slow movement because of the few savvy investors that were capitalizing on a weak era. The athletes in the nineteen seventies’ era were at the end of their careers and the stars had not yet been inducted into the Hall of Fame. The nineteen seventies were weak and weak prices were a result. Looking back now, it’s clear that savvy investors, who looked uneducated at the time by buying the nineteen seventies’ baseball cards, are now known as the market bulls. And looking back now, trading cards from the nineteen seventies’ era are very strong, even with the manufacturers’ increase in the production numbers due to sport popularity. Enough time has passed and now those nineteen seventies’ cards have moved into vintage status, and the demands are now superseding the supplies once again. Knowing if an era in sports cards is strong or weak helps all investors make buying and selling decisions in the sports collectable card market.
All three market financial patterns, the popularity era of the sport you collect, the manufacturing quantities produced of the brand of cards you collect, and the historic market increases and decreases in the years you collect, can help any collector advance into a potential collectable investor. Keeping your hobby fun is an important factor when buying or selling your sports cards, but keeping your eye on trends in the market while you are having fun, will make your dollar go much farther. Keeping financial patterns in mind while doing your card buying and selling will help you balance your hobby as well as your bank account. Bringing balance into your life takes time and patience, but in the end… it can become very rewarding.