The main factor that contributes to successful speculation on MTGO is to target cards that are currently being opened in draft. Cards from the current draft set tend to be priced too low relative to their long-term value. However, low prices following the debut of a new Standard usually last several months. Buying these cards just prior to the introduction of the next draft format generally generates speculative gains when Standard is rotating.
This is true for block sets. For core sets, the deal is remarkably different. Magic Origins prerelease events start this Friday and present one of best opportunities of the year for MTGO speculators.
Core sets are only drafted for about two months, which is a short drafting window for a large set, in an environment where demand for Standard cards is low and players are waiting for rotation. By comparison, Fall sets such as KTK are drafted for four months before the winter set (FRF in this case) is introduced into the mix. With a shorter drafting window comes a much smaller overall supply. A smaller supply creates a higher volatility for prices.
The timing of the core set release is also peculiar. It comes at the end of a Standard format, so the card pool is quite large when it’s released. Although every new set shakes up Standard to some degree, a larger card pool means that additions to the format will have a smaller impact, all things being equal. Once Battle for Zendikar (BFZ) is released and Standard rotates in October, ORI will then occupy a relatively larger chunk of the Standard format.
The release of the Fall set and the subsequent first Standard Pro Tour of the Magic year then trigger a high demand for core set cards. The demand will keep up during the winter and prices will rise according to metagame shifts.
Between August and October Magic Origins price variations will summarize in two months what usually occur over twelve months for Fall sets. With a short drafting window and Fall rotation just a couple of months down the road, core set speculations are a great speculative vehicle. Here are our general guidelines for speculative purposes with boosters, singles and complete set positions with Magic Origins.
Magic Origins Boosters
Core set boosters are a way to speculate on ORI without having to target individual cards. The buy and sell spread on boosters also tends to be very small, so the haircut on transactions is smaller than for singles.
Boosters enter the MTGO economy in two ways. They can be purchased at the store at full retail (there are no bulk discounts available), and they can be won through sanctioned events.
Having boosters available for purchase at the store means that boosters should never have a secondary market price higher than $4, which is roughly 4.2 tix. If prices in the MTGO economy were higher than this, people could buy boosters from the store and resell them for a profit. This rule of thumb can vary somewhat due to consumer taxes on store purchases and other transaction costs involved with the MTGO economy.
The other side to consider are boosters awarded through sanctioned events. Both drafts and constructed events award boosters, but due to being a net consumer of boosters, drafts drive the price of boosters up while constructed events drive the price down.
When a draft format is brand new, demand from drafters dominates and prices on boosters tend to stay high. Over time though, boosters awarded to Constructed players will start to dominate and prices on boosters will fall. The absolute bottom will occur in the week of the next set's release. This happens as drafters entirely shift their attention to the new set, while Constructed players are still being awarded the old set in prizes.
Core set boosters have the added benefit of a relatively small supply of singles and thus higher prices. Once interest in the new draft format dies down, some drafters will look to get the best value out of their drafts, and so sets with higher singles prices will attract these drafters. Core sets are also geared towards newer players with simpler and resonant cards. One of MTGO's target audiences is lapsed players, so core sets also appeal to this demographic. All together, this contributes to a consistent level of interest for core set Limited on MTGO, much more so than in paper.
The strategy for speculating on ORI boosters is to buy them during the first week of BFZ release events. Last year, M15 boosters bottomed at 2.2 tix on October 7th, although buying at any price below 3 tix would have yielded a nice return, as they went to 4 tix by the end of January.
Speculators with plenty of capital and time to devote to this trade should be confident that this strategy will be profitable again this year. Buying ORI boosters at 3 tix or less in September and October will yield a profit of 0.5 tix or more per booster over the winter. With a high degree of liquidity, a guaranteed market, and a low spread, core set boosters are ideal for speculators that don't want to be concerned about the Standard metagame or any other secondary market fluctuations.
Mythics and rares are the individual cards speculators should focus on. Uncommons have extremely limited upside. Stoke the Flames in M15 was one of a kind and the only uncommon in recent core set history to be constantly priced over 1 Tix.
As mentioned in the introduction, the vast majority of Magic Origins cards are expected to decrease in price during the first two to six weeks after release while being heavily drafted. Depending on Pro Tour Magic Origins results some cards, mostly mythics, may actually trend up very early and resist this downward pressure without establishing a floor. Such cards would be in demand, and therefore expensive, in a Standard metagame about to disappear. Mythics or rares in this situation may therefore not really reach a low point in August/September and should be avoided as speculative targets.
Last year, due to a strong result at PT M15, Nissa, Worldwaker was immediately priced above 20 Tix , peaked at 30 Tix mid-September, but slowly declined thereafter to 15 Tix in December. The new Standard environment after the release of Khans of Tarkir didn’t favor the green planeswalker. Buying Nissa at 20 or 25 Tix in September would have been a mistake.
The speculative strategy with core set mythics is highly predictable and fairly straightforward. Apart from exceptions influenced by PT results, buying any, if not all, mythics two to three weeks after the release of Magic Origins is a strategy likely to yield a profit. Sylvain discussed and successfully applied this strategy with M14 and M15 mythics.
In the case of core set mythics, buying a basket, e.g. buying most if not all of the mythics, is highly recommended. History has proven time and again that it is difficult to determined in advance valuable mythics, especially as the format is about to be changed dramatically with four sets leaving (THS, BNG, JOU and M15) and two freshly released (ORI and BFZ).
Thundermaw Hellkite, M14 Garruk, Caller of Beasts and Perilous Vault started out relatively low before exploding in October-November. A basket of ORI mythics is the optimum strategy for speculators who don’t want to miss the next Perilous Vault.
Due to a relatively low supply of core sets (only two summer months of active drafts) any mythic that sees play is susceptible to a big price increase. Out of the 14 mythics eligible for the M15 mythic basket (Nissa, Worldwaker was not considered), all got more expensive at some point between September and May than they were in August. Six of these doubled or more in price, with Perilous Vault, Soul of Theros and Soul of Innistrad quadrupling or more their price. The benefits of a basket definitely outweigh the risks and the losses generated by few loser positions.
Although prices rise and fall according to metagame changes, the prices of mythics are not as volatile as the prices of rares. Redemption is also another factor that weighs more for mythics than for rares in supporting prices.
A pattern often observed for core set mythics is a rise in price from early September to November, which may be enhanced by PT performances in October. From there, mythics appearing in the top decks are likely to sustain or increase their price while mythics not favored by the Standard metagame will start slowly declining as Winter approaches. December could actually be a good period to acquire discounted mythics that may increase in price in February, or later in May, with the release of two more sets.
A similar basket approach is also highly recommended with rares, although unlike mythics not all rares will be a good pick up. Based on previous core set rare trends the vast majority of ORI rares are expected to hit a floor around mid-September. By that time, bulk rares should be priced at 0.1 Tix or below and the more valuable rares should have stabilized. Past that point in time the first spoilers of BFZ will be known and some ORI cards may consequently start rising.
The prices of rares are much more volatile than the prices of mythics. Price variations are also much more metagame-dependent. In this context it is almost impossible to predict the average good period to sell ORI rares. Most rares will see a boost in price from October to March. Some rares can reach their peak in value early in the season, such as Hornet Queen and Genesis Hydra, later in the winter like Hushwing Gryff and Shivan Reef, or later in the summer like Caves of Koilos and Obelisk of Urd.
The difficulty for speculators is to estimate to ideal selling time. Generally speaking, 5 to 7 Tix is a decent cap for any core set rare. Some exceptions exist but breaking the 10 Tix mark as Mutavault, Goblin Rabblemaster and Thragtusk did is unique and definitely not the norm.
Although we will share our opinions in future MTGO Market Reports, every speculator should use their own judgment to decide the appropriate action with their own portfolio. Being attentive to metagame changes is, as often, key.
Speculators should be acquiring mythics within the first two to three weeks after release. Mythics whose prices would be significantly affected by Pro Tour Origins should probably be ignored. Bulk mythics should not be acquired at more than 0.5 Tix and are likely to hit 0.3-0.4 Tix sooner or later. The selling period should be adjusted to the Standard metagame orientations with November to December being an general good selling window.
The optimal buying period for ORI rares should be situated between mid-August and mid-September. Any rares with a slim chance of Constructed applications may rise in price. This has been the case for many core set rares in the past. Despite a fifth reprint, the five painlands are a must for any portfolio--they will be part of the Standard metagame independently of its changes and will certainly see a price increase.
Complete set speculation is a bit of a mix of booster speculation and single card speculation. You have to buy cards, all of the 272 cards (including basic lands) of ORI to be exact, but with whole sets the bet is on the global price trend, similarly to boosters.
Investing in full sets has its own advantages and disadvantages. Expected returns are in the order of +30 to +50%; speculators should not expect higher percentages here. The strength of whole set speculations is the possibility of investing several thousands of Tix at once in extremely safe positions since the trends of complete sets are highly predictable.
The average value of an online set tends to be low while the set is drafted. Individual card prices may see spikes and drops but the average full set value is very stable and easy to anticipate. Starting next week, ORI will be the newest Standard set to be drafted until October with the release of BFZ.
The value of the ORI set will probably decline until September, with a bottom likely to be found between mid-August to mid-September. M15 complete set value hit its bottom around mid-August and started rising late August. M14 hit its lowest value mid-September and started rising right after. M13 was different as the first Standard Pro Tour following the release of M13 was held only in Februrary--PT Gatecrash.
This year, and after several changes in the Pro Tour calendar over the past couple of years, the Pro Tour calendar for this Summer and Fall is identical to last year's calendar at the same period. We'll have a Standard PT Core Set in August followed by another Standard PT Fall Set in October. For full set price trends and speculative purposes, M15 price variations should serve as a blueprint for Magic Origins full set investment.
M15 reached its highest value early in November and then again at the very end of the year late in December. This pattern was also observed for M14, making the November-December window likely the optimal selling point for ORI full sets as well. No significant further gains were observed after the release of the second block set (in February), so there's little incentive for speculators to wait two to three more months for no or very little additional profit.
ORI full sets should be acquired mid-August to early September for optimal buying prices. The price of a Magic Origins full set should be slightly below 100 Tix at that time. Full set speculation is a unique opportunity for speculators with big bankrolls to easily invest a large amount of Tix. Full set speculations require very little time commitment during the length of the investment.
ORI full sets are likely to reach their maximum value between November and December. Speculators should probably sell their ORI sets during that time and should consider a +50% profit in less than four months a great investment. Full sets can be purchased through the Classifieds on MTGO and via bot chains selling full sets such as Goatbots and Clanteam.