Box to Extended – Long-Term Gains
- Box to Extended – The Birth of an Idea
- Box to Extended – Community Involvement
- Box to Extended – The Starting Line
- Box to Extended – Moving Up in the World
- Box to Extended – New Beginnings
- Box to Extended – Trades and Top Ten List
- Box to Extended – Looking at Trades
- Box to Extended – Getting The Important Details
- Box to Extended – ISD Sleepers and Rockers
- Box to Extended – Innistrad
- Box to Extended – Social Networking
- Box to Extended – Making Your Margins
- Box to Extended – Long-Term Gains
- Box to Extended – Commons
- Box to Extended – Pimped Out, Part 1
- Box to Extended – Pimped Out, Part 2
- Box to Extended – Pimped Out, Part 3
- Box to Extended – Oddities and Miscuts
- Box to Extended – Holiday Treasures
- Box to Extended – Pricing Guides
- Box to Extended – Long-Term Thoughts
- Box to Extended – Long-Term, Part Deux
- Box to Extended – Investing for the Modern Man
- Box to Extended – Pack to Prowess
With the project well on its way, it’s time to cover something a little more long-term. This week, I will be covering how to prepare your collection for the future. Short-term gains are great for creating capital to invest in collections and call shots, but what do you do if you’re looking to turn Magic into a true investment? Learning how to identify the best way to make current purchases for future value can be as simple as stashing some dual lands, but is that the best bang for your buck? I’ll be delving into what current market purchases should fatten your wallet in the years to come. I will also be talking about the trade that, unfortunately, was lost in translation last week, and how I turned an Illusionary Mask into a plethora of staples in a multitude of formats.
First, it should be noted that long-term investments are not for everyone. If you are looking to assemble a Standard deck for next week’s FNM and have no concern for next year’s market, this may be less relevant for you. This article is aimed at the people who are looking to make the financial Magic market more than just a weekend hobby. Looking at the history of Magic, you can see a variety of price trends that mimic those of stocks and bonds throughout history. Just like the stock market, Magic has its gains and losses—up times and down times. Learning how to identify the best investments is surprisingly similar to playing the stock market; however, in this market, our gains are far more profitable on a smaller scale.
A typical portfolio will show approximately a 10% return on an average year, giving leeway for irregularities. So if in a given year you invested $10,000, you could hope to profit about $1,000 by the end of the year. This is obviously a vacuum scenario, but you get the point. Now let’s look at the possibility of . . . say . . . dual lands last year. What if you had invested that $10,000 into individual duals at a rate of $50 per card? This would net you 200 duals, which you could then hold for the remainder of the year.
Given the 10% portfolio average of the stock market, all of these duals would have to do is gain an average of $5 each to net you the same return. If you look back on the market, however, you can see that almost every year, the rise is significantly more than that, and that’s not even including last year’s sudden surge in price. This is, of course, a vacuum case again and hardly something I suggest running out and doing tomorrow. First, you have to weigh the risks and rewards of each investment method to decide what fits your preference.
There are trends to look for in the past, much like in the stock market, that can hint at which investments are safe and which could possibly yield higher returns but have a higher level of risk. The dual-land example I listed above is a fairly safe investment given their already high price and the placement of the reprint policy. A solid example of a riskier investment comes in a different form of lands: shock lands. Given their current necessity in an upcoming Pro Tour Qualifier format, it is likely that we will see a rise from the current $20 to $25 price tag that they’ve been averaging. Though it is likely we will see an increase, I do not feel safe investing large portions of capital into such a risky investment—but that is personal preference.
The main issues I have with this investment come in the form of uncertainty. I am a cautious person, and therefore I don’t make too many risky moves without first calculating the inherent risk. In this case, we have the issue of a possible reprint in the near future. Given that the next block is rumored to return us to Ravnica, it would be an ideal place for Wizards to find a way to reprint these lands, whether in the actual set or in a special item such as the Premium Decks or FTV series.
Beyond the issue of reprints, there is the looming question regarding the success of the format. With the flop that was Extended last year, players are hesitant to approach a new format that has already had its fair share of problems. If Wizards of the Coast bans everything, does that really make for a healthy format? Until I can gauge the community’s acceptance of the format, I don’t want to place large amounts of money in it. That said, picking up shock lands now can still net you a solid return come PTQ season—I just wouldn’t hold them past that.
With everyone’s current concentration on Modern, I would instead, as an investor, move my focus elsewhere. In this case, I would be looking at picking up any Legacy or Vintage staples you can while people are so concentrated on the here and now. Given the fact that they are Eternal formats, I would expect focus to shift back to them at some point. Thanks in part to the circuit Star City Games runs, I would not be surprised if Legacy begins playing a far larger role in the future of Magic. Although this is a safe investment, it could take years to see any sort of a high return; if you are willing to wait that long, this is probably among the best options for you.
However, if you are slightly more impatient, I would suggest looking at a group of cards that have the chance for high returns, while at the same time having a lower risk than shocks lands. In this case, I am talking about fetch lands—both old and new. Because of the need for these lands in almost every format they are legal in—from Vintage to Commander—it is a sure bet that their values will only grow over the next few years. If we look at the rate of the Onslaught fetches alone, we can see dramatic rises over just the past few years, and that trend doesn’t appear to be stopping any time soon. The only thing you need to be concerned with in regard to the fetches is the possibility of their reprinting. They are very available right now, so I would say you are fairly safe, but it’s always something to worry about. However, unlike shock lands, fetch lands have a small margin for loss even if they are given the nod for a reprint. This is primarily due to the large number of formats they are seeing play in. It’s also because if they were reprinted in large quantities in a core set, the fetch lands would also have the Standard format to boost their prices and keep them from plummeting. Investing $10 to $12 in a modern fetch land and having it drop to $8 because of a reprint is far easier to cope with than investing $20 to $25 just to see the same price point.
Well, that’s all I have for this week in regard to long-term investments; expect a more in-depth analysis of particular cards in the future. I don’t want to cram too much information in at once, and this should give you some food for thought regarding what to invest your finances in. Let me know in the comments what you feel would be a good long-term investment along with your reasons. Reply to others’ comments with words of advice, possible holes in their plans, or ways to build on their ideas.
As promised, here is the rest of the trade that unfortunately could not be uploaded last week. I have learned a valuable lesson in regard to phone video: Make sure it works before you walk away from the table. On that same note, given the overwhelmingly positive response, I will probably look into investing in a better camera so that these technical difficulties can be kept to a minimum. For the purposes of this particular trade, I will post the values we placed on each card rather than the actual retail value so that you can see where we are meeting. It should also be mentioned that Ed is a law student who has very little time for MTG anymore, and he has shifted his focus from being a regular Standard FNM grinder to being a long-term collector for both Vintage and Legacy. Given this information, he was willing to part with a large number of his more current cards at a discount in order to obtain these older staples.
+4 Chandra's Phoenix (1 Japanese) 3
+5 Champion of the Parish 3
+1 Stromkirk Noble 6
+1 Geist of Saint Traft 10
+3 Kessig Cagebreakers 0.50
+1 Sun Titan 8
+1 Razorverge Thicket (Foil) 10
+3 Tooth and Nail 15
+2 Chalice of the Void 10
This trade is obviously lopsided, but in all honesty, these types of trades are very common when dealing with hard-to-find, high-dollar cards. As I mentioned last week, one of the greatest assets of being a regular floor trader who travels is the availability of any card. This gives us a huge leg up on those who don’t go outside of the state for events. The fact that we see so many binders on a regular basis allows us to pick and choose the sweet deals, and in turn, come home and turn a solid profit on them. Knowing what your local players are seeking is something very important to the inner workings of the trade game.
Well, that’s all I have for this week. Let me know what your thoughts are on long-term investments. Where would you put your money in the MTG market right now . . . and why? Until next week, keep your heads up; with this recent announcement involving the Planeswalker Points and banishment of the Pro Players Club and Worlds, it can be easy to become frustrated. At the end of the day, though, just remember that no matter how hard they try, WotC has created a monster that will take far more than this to kill. Keep the comments and Tweets coming!
Until next week,