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Insider: How To Take Difficult Losses

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The summer slow-down has shown no signs of reversing, much to my dismay. Many Modern staples still remain well below their highs despite Modern PTQ season kicking into gear. I was so confident staples like Snapcaster Mage would bounce, but no such luck yet.

Snapcaster

What’s worse, some less frequent Modern-playable cards are continuing to drop even now. I’m baffled that the survival of Jund in the format has not yielded any support for the price of Raging Ravine. Buy lists are abysmal.


A few weeks ago Corbin wrote an excellent article capturing the reality of things: if Modern season hasn’t catalyzed the market, then it was probably overbought to begin with. Even SCG’s recent announcement of adding Modern events to their weekly circuit has done nothing for Modern values in the short term.

Corbin recommended selling freeing up some cash and avoiding unnecessary opportunity cost by selling some Modern stock. I’ve taken this advice to heart, and have since listed a handful of playsets on eBay as well as submitted a couple smaller buy lists. I’m not selling out altogether, but with rotation on the horizon I’d rather have my resources liquid enough to take advantage of movements within the Standard format rather than the lack thereof in Modern and Legacy.

One Little Problem

There’s a reason I haven’t sold off the majority of my Modern staples, and it has nothing to do with diversification. As it turns out, a slow Modern market means it’s very difficult to sell cards profitably. Buy lists reflect the slowing demand and the market is flooded with speculators and traders eager to move some stock.

As a result, I am feverishly kicking myself for declining to take $4 for my Raging Ravines now that I’d be lucky to net that much selling on eBay. The dream of being able to buy list Inkmoth Nexus at $7.50 again is also dead, as these have been on a flat-to-downward trajectory for months.

Inkmoth

One thing is for sure–once Modern PTQ season ends, Modern staples which have little presence in other formats could fall severely out of favor out of fear of reprints. Wizards is proving to us they are willing to throw seemingly arbitrary valuable cards into a set to help alleviate prices.

As a player, I’m thankful for these reprints, but, as an MTG Speculator, this means danger. Holding Modern staples through to 2015 in the hopes of moving them at a higher price carries tremendous reprint risk and opportunity cost.

Therefore, my choices are to either hold onto Modern staples and risk reprints in a future set like Modern Masters 2, or to sell some cards at a break-even price point or even a loss.

I have chosen to strategically do a little of both.

What I Sold

The most obvious sale for me was Phyrexian Revoker. As soon as I heard this guy was getting reprinted, I knew I couldn’t keep my set if I wanted anything above a buck for them. Off they went to ABU Games at $1.65 each, likely below where I bought, but also about what I would have gotten with an eBay listing.

After sitting on them for over a year, I also moved my Sorin, Lord of Innistrad. I know, I know – these are Planeswalkers and will never drop in price, right? Right. But that doesn’t mean they have any right to go up in price either. They have sat at a $3.50 buy list price for a long time now and opportunity cost was eating at me.

I only owned a set, but it’s obvious that B/W Tokens isn’t a significant force in Modern, and casual demand could take years to soak up all the Duel Deck copies of this card to make the price rise. This was not time I was willing to wait.


I’ve also decided to move all my Swords. You know, Sword of Feast and Famine and the rest of the cycle. Again, I know casuals love these and they have some Constructed playability as well. But after watching Sword of Feast and Famine get smashed by the Event Deck reprint, I was delighted to get $13ish for my played copy.

sword

Since I’m a tad-bit OCD when it comes to these things, I figured I should just move all my Swords. I only owned one of each, but the enjoyment I was getting out of them did not outweigh potential for price declines. And with Star City Games paying $30 on Sword of Fire and Ice, the decision wasn’t really that painful.


A few cards I’ve listed on eBay in an attempt to net a bit more in cash include Inkmoth Nexus and Raging Ravine. I’m tempted to list my Stirring Wildwoods as well. If Modern won’t bring life into these cards, then I am not sure what will. At this point, I’d rather have the cash to put elsewhere.

What I Am Holding

I am still sitting on all of my Shock Lands and Scars Fast Lands. Like many others, I’ve placed a significant bet on these and that bet has not yielded satisfactory gains. In a time where the Stock Market yielded something like a 25% gain in 2013, to see something significantly less in a Shock Land investment has been very disappointing.

But I can’t sell yet. My gut is still insisting these are a solid long-term investment. Even though many people are sitting on a gaggle of excess copies, I’m going to sit tight for the time being. At least the bottom hasn’t fallen out from other them yet–buy lists are still reasonable and I don’t believe there will be much dip come rotation.


In addition to this real estate, I recommend sitting on newer cards also playable in Legacy. This mostly refers to Deathrite Shaman, Abrupt Decay, and Swan Songs. In fact, foil versions of these cards are probably an even safer hold, and I don’t believe the market bottom has dropped from under foils like they have recently on nonfoils.

While we’re at it, let’s add foil Cavern of Souls, foil Shock Lands, and foil Delver of Secrets // Insectile Aberration to the hold list. While I don’t own all of these, the ones I do currently possess are staying with me and not getting shipped off to a buylist despite the short-term market decline.

(Though, as an aside, I will admit it’s awfully tempting to buy list my single foil Cavern of Souls to ABU Games because as of now they’re offering $35 each!)

Am I Acquiring Anything?

As I mentioned in the beginning of this article, I am actually keeping a closer watch on Standard than I am on Modern as we approach rotation. Magic 2015 is shaping up to be an interesting enough Core Set to maintain player interest. Reprints like Urborg, Tomb of Yawgmoth will compound interest and ensure players don’t abandon Standard altogether. And with mysterious promises from Mark Rosewater regarding Khans of Tarkir, I can only assume Standard will boom yet again come rotation.

All that being said, I’m not actively picking up a whole lot these days. I’ve got a few sets of Theros Thoughtseize, though I could use a couple foils. I’m on the lookout for those. I made a move into Eidolon of the Great Revel just in time to make a few bucks, but I’m more in the “sell” camp now that the card has bounced nicely. Mana Confluence should be a decent buy, but I honestly like the Theros block Temples more.

I also still like Power and other Vintage staples, though, after acquiring a few high-end cards in this category, I feel the need to put on the brakes simply because I want to maintain a diversified portfolio.

Casual gems continue to make it on the Interests page of mtgstocks.com, but I have zero desire to speculate on stuff like Apocalypse and Copy Artifact. In fact, I admittedly gave up on my Winding Canyons spec recently. I figure if the recent hype the card received wasn’t enough to catalyze the market on this EDH-playable land, then I don’t want to wait around for what will. I took my losses, which were razor-thin, and moved on.

Ho-Hum

I’m sure there will be plenty of excitement in the MTG Finance world come the fall. But for now, things are fairly stagnant. And with downward catalysts coming up for Modern cards, such as the end of PTQ season and potential for reprints, I’m placing one foot out of the “Modern is awesome for investing” camp and into Corbin’s “Modern was overbought and has little financial opportunity” camp.

I’m not going all-in on this because diversification is still a critical way to reduce portfolio risk. But after witnessing the recent boom in Modern, I have to admit I’m disappointed in the financial trends this PTQ season so far. Prices should flatten out, but I certainly don’t see growth ahead. This is why I’m taking a hard look at my MTG portfolio and selling some cards, even for small losses. I’d rather have the funds working for me elsewhere, and I would encourage you to consider the same.

Sigbits

Here’s how bleak the Modern scenario is:

  • I buy listed my Birthing Pods at GP Cincinnati this year for around $12 each. Now Star City Games has 64 total copies in stock with a NM price of $11.99. Quite the drop.
  • I sold a couple sets of Inkmoth Nexus in the $7 range between GP Cincinnati and eBay, and I decided I’d keep a few more to catch that last 10% gain. The plan backfired. SCG only has 21 copies in stock, but at $7.99 I may have to wait quite a while for a chance to sell my stock at $7 so easily.
  • The best buy list offer I saw on Razorverge Thicket during GP Cincinnati was in the $3.50 range and I insisted on holding out for $4. Big mistake. Star City games has 432 NM copies in stock, on sale for $3.74 each. Other Scars Lands are also on the decline. Ouch.

28 thoughts on “Insider: How To Take Difficult Losses

  1. I would have kept the Swords for their casual appeal and I’ve kept my Canyons, they are on the reserved list, it’ll happen eventually. Otherwise I’m holding a playset of all, but I don’t usually part with my playsets.

    1. I expected you to disapprove of my selling Winding Canyons. I waited a bit and watched their prices closely…they just wouldn’t budge. I don’t have the patience you have to sit on these cards for a long time. They’ll never really drop in price, but if I want something that will be worth $5 for years I will just get a $5 bill 🙂

      As for swords, I originally had them for “casual” enjoyment but they just sat in my binder and rotted. And as we see reprints happening, I figured it wasn’t worth just sitting on them. I don’t see much catalysts to drive these higher in the near term but who knows. Maybe I’ll be wrong – but I’m doing alright on the sword regardless so no complaints.

      1. The thing is, when they budge I think they will go big. I don’t mind waiting for that. Worst case I should be able to get out what I put in as they did go up and I bought for the old prices (2nd worst case, abolishing the reserved list and reprinting is obviously the very worst case).

        I imagine casual players keep wanting Swords, but I can see how they might be easier to move in trade than for cash. Casual players on average tend not to like to spend what they cost but are happy to trade for them.

        It’s of course in both cases ok to move them if you can put your money in a better place.

  2. So how much of this was too many retailers / speculators in the market? Magic is growing but Modern overreaction by most all. Glad I sold some Birthing Pods when that was bought out. Someone lost big on those short term at least.

    1. I’m beginning to wonder the same thing. Obviously Modern was overbought because the increased demand from PTQ season is not influencing prices at all. This is concerning to me for short term trends.

    2. I have mentioned my concern about this on more than one occasion. I think its very important that we recognize our own affect on the market as speculators. People got so high on Modern after seeing what happened with the value of cards in legacy, we all thought that modern was the second coming of legacy. Well, the results are coming in, and it seems pretty clear that the value of modern cards was inflated by speculative hype, and that we have not reached the player base we needed to for modern because people are waiting for reprints to happen and card prices to drop. The fact that cards like the fetches hit $100 almost certainly priced many new players out of the format, thus causing demand to decrease even further. This phenomenon is the result of the expanding MTG speculation community in general. We need to be more careful in the future to temper people’s expectations. Although this site has been very good about telling people not to listen to the MTG finance subreddit, I think in general we need to be very clear about how speculation activities actually alter the market.

      1. It’s becoming more and more apparent that your argument holds merit. I still think we should wait a few more months to confirm, but it definitely appears speculators and retailers overbought the market. We are now suffering the consequences by holding all these cards as they drift downward or horizontally in value.

        1. Its going to be interesting to see how this event affects the spec community as a whole. Hopefully all the people who got burned hard by this will just stop speculating, and then it wont drive this heavy boom-bust cycle we have seen. People getting burned by bad spec drives down spec demand, which should be overall good for the entire community. Basically its become clear that its not a kids game with free money anymore, and that should lead to more sane practices.

  3. Just out of curiosity has anybody considered what will happen when Magic’s popularity begins to stagnate and wane again? It’s very typical to see a product similar to magic rise and fall and rise again, and while I believe the playerbase is pretty strong, I completely believe we will see demand start to trend downward at least some. Innistrad block brought many players into magic and it was such a strong block, the likes of which we haven’t seen since and I personally know many players selling all of their stuff because they just aren’t enjoying the game anymore. Recently I actually decided to sell anything that I’m not using, and that’s not on the reserved list. I barely missed getting burned hard by Urborg’s reprint, and with Wizard’s willingness to reprint at will, and the high possibility that the reason card prices are still falling is because of hyper speculation, with people finally trying to unload all of that due to opportunity costs, I’m just no longer willing to hold most things, obviously with exception.

    1. Matt, you pose a scary possibility. What if WOTC makes a set that just doesn’t impress the masses and interest fades? It’s always possible, right?

      I will say momentum on MTG is very positive right now, and the upcoming movie is likely to grow interest even more. Magic has proliferated quite a bit on the past couple years and a reversal could not occur suddenly. We’ll have plenty of hints/warnings that Magic is fading a bit. The key is to detect the warning early enough to bail before it’s too late. How can we be sure of this? That’s the hard part.

      1. I completely agree that it won’t be a transition over night, and I believe a good part of recent growth was the maturity of the older player base. I started playing around Tempest and I was only 8 years old when I first started collecting the cards. I was 12 when I actually started playing with the cards I have been collecting. Many of my friends had been doing the same thing, and once we all hit around 22 and had more expendable income, our expenditure on Magic grew immensely. Between reprints and possible slow downtrending in demand, I think the right calls were made in this article. Swords included.

      2. I am actually more rosy about the growth of the player base than most. I have several friends who have bought boxes of magic cards in the last year without even really knowing how to play. The big question for me is: how many of these people will actually start playing competitively? This, after all, is where the real value of magic cards comes from. Sure, the movie may attract a large casual player base, but will the appeal of standard and modern attract more people to competitive play? I’m hoping that wizards will return to incentivizing competitive play with the player rewards club and the like. Real tournament magic is by far the funnest way to play the game in my opinion, but are people gonna get serious because they watched the movie? It’s not at all clear. Modern is both my greatest hope for the game and my greatest disappointment. I really thought we were going to have an eternal format with with Standard-level interest in the next few years, but now it seems like that was all an illusion. What do you think about this?

        1. I feel Modern will continue to grow in popularity over time. The format is a TON of fun to play and although prices are inflated currently, the barrier to entry is still far below that of Legacy. An affordable, eternal format is exactly what MTG needs for players who came to the game in the last 1-5 years. Because Magic has been booming in popularity, there are MANY players in this category.

          That being said, the newness of Modern will lead some a little bit of awkwardness. The older and more mature Modern gets the more broadly it will be embraced, IMO. Think 5 years out: Modern will be attracting all the newer players and will continue to grow in sophistication. I believe the long term enjoyability of Modern is bright.

          That being said, Modern is no longer the cash cow it once was. Between over speculating and fear of reprints, money making from this format may be a much more gradual grind going forward.

          Do you think Legacy was overbought too (the recent spike in Duals, Sneak Attack, Wasteland for example) or are these OK this expensive?

          1. Re: legacy. I think that format is on the perfect cusp between playability and collectability to hold its prices forever. The duals have become iconic as well as the other reserved list legacy staples. The legacy staples are the new power, in some sense. I own an Esper Deathblade deck that I rarely play with because I know the cards aren’t coming down, and I want to have the ability to play the format in the future.

            I really wish I would have been in the position to trade my modern into legacy before the dual land spike. That was definitely the optimal spec play of 2014 and I basically missed it. I was able to trade into 1 volcanic island and 1 tropical island before the spike ran away. I didn’t want to trade out of all my modern staples because I thought (with everyone else) that PTQ would see another big spike.

            1. I agree with you. I also managed to trade into a few played Duals myself right before Duals spiked. It was very nice. I was even trading in Modern stuff to dealers at GP Cincinnati (SCG mainly) for HP Duals, which I’m now able to trade/sell for more than what I gave up in store credit. Sweet deal. A lost opportunity now.

        2. The general consensus seem to be that there are way more casual players than there are competitive players. The competitive players are more vocal and they have clear tournament results so they have more influence on prices, but that doesn’t mean there’s no influence from casual players, you just notice the influence slower as casual players tend to cause slow rises. I have to disagree that all these people need to become competitive players. Not to say that I’d mind if wizards did increase incentive to play competitively, but I don’t think it’s quite as important as incentivizing these new players to keep playing, regardless of how they play.

          1. This is very interesting. I agree that most players are casual. Also, my transition from casual into competitive player took a really long time and a lot of variables had to fall into place. The first variable was that I had a bit more time and a bit more cash to spend on Standard staples. My first standard deck was Naya Lightsaber in the Alara/Zendikar block. Although I had been collecting casually for years before that, I had never spent so much money on magic at once in order to build that deck. It felt weird to spend so much money on cards but great when I 4-0’d my first tourney. I was hooked after that. Having collected significantly more cards since I become competitive, I happened to own many of the most important modern staples, so the format was very attractive to me, much more so than legacy, for example.

            I’m hoping that as modern stabilizes newer competitive players will be able to trade standard staples they don’t need for modern cards and be able to enter the format. I agree that modern will see growth over the next 2-5 years, but the question is where that growth is coming from.

            Is it coming from Standard players who are sick of the planned obsolesence of standard, or from standard players who are able to break into the the format? Does someone need to move into standard before they can become a modern player? What motivations actually drive people from casual to competitive play? Can we expect that a larger casual player base will translate into a larger competitive player base? Is there a way to get a larger number of people directly into competitive play?

            1. Is there a need to get people into competitive play?

              I am probably in the top 1% collection wise among casual players: I can build nearly every competitive Legacy deck without needing to get more than a few cheap cards (and not counting the Duals I can build most fully English black bordered too), same for Modern and besides 6 pieces of Power and 3 Shops I could even manage Vintage. I am a rare breed though in several ways, big collection, knowledgeable on prices, but still casual. Many casual players I know though do shell out for more expensive cards, up to Duals if they are priced well.

              I really don’t see the need for people to always move towards competitive play. I built Standard legal decks in the beginning because those were all I could build with my collection (I liked equi-luren after my Dream Halls got banned, last I built was my own Madness variant back when invasion an Odyssey block made up Standard), but I always played them casually. I have played in a few small Legacy tournaments, but only because it beat twiddling my thumbs in an hotel room when I was in Germany for work and I played in a few pre-releases, I remember Unhinged most fondly. I would’ve been happy to skip any of those experiences for a nice free-for-all multiplayer game. I just don’t feel the need to play at the competitive level, it’s just not as enjoyable as playing casually. Many casual players share those feelings.

              it’s fine if you get more enjoyment out of competitive play, but realize that it’s not the culmination of everybody’s Magic career. As long as people keep playing, whichever way they play, Magic’s healthy.

              1. Totally agree on your point pi, I like how much Jason alt’s articles give attention to casual demand. It feels like casual players drive a lot of solid long term gains.

  4. This was a great and informative article. Thank you for this Sigmund, i’m a recent Insider and this is one of the better articles I have read thus far.

  5. They’re willingness to reprint is now starting to worry me. And the volatility of speculating I fear may be too much for me to bother. As for the player base I feel that as long as there are new players coming in it is good. I’ve only ever played FNM twice. Period. And that’s more than some of my playgroup. Casuals/ collectors are the heart of mtg IMO. And collectors are being punished by WOTC

  6. I’m just entering the MTG Finance scene. Based on this and past articles (like Corbin’s) it seems Modern staples are down *significantly*. As someone new is this time to buy/trade in on staples (Pod, Resto, even Scooze)? Or will these prices hold about where they are now and I should focus in more immediate targets, like Standard staples such as temples (presuming I can get them low enough)?

    1. It’s looking like from a pure spec perspective you are gonna want to keep your funds available for standard. If you want staples to play modern, now seems as good a time as any to get in.

      1. Agreed. Speculating on Modern staples is a major gamble given reprint risks. Modern Masters II will happen. If it happens before Modern PTQ season 2015 there may not be much opportunity to move copies acquired now for profit. I’m watching Standard and Vintage.

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