Magic finance has become a lot more complicated in the past few years. I think there are a lot of reasons for why this is, but three in particular:
- The influx of reprints from Masters sets has destabilized the price of staple singles. There are more "spikes" and "tanks" in a market where previously existing cards are constantly being brought back into print.
- The prevalence of online buyouts has dramatically changed the way we think about the value of cards. The Reserved List is static, and we've learned that groups and individuals can manipulate the market price by buying up huge quantities of scarce cards.
- The competition is smarter and better informed than ever before. Access to and availability of information are so much faster and better disseminated through the hivemind. For instance, a website like Quiet Speculation now exists and thrives and is completely dedicated to helping already-knowledgeable speculators more finely hone their investing skills.
I believe these factors (reprints, the Reserved List, and more aggressive competition) are the three most important elements that frame the current MTG Marketplace.
My approach to investing in Magic has always been to cultivate an overall strategy that is based on how I believe the marketplace works. I've had different approaches during varying eras of Magic's history. With that being said, I'd like to specifically discuss my strategy for the current time period.
I'm out on Modern
I'm out on Modern cards – and I have been for some time. Don't get me wrong, I greatly enjoy playing Modern, but I want no part in investing in it.
My personal collection is basically divided into three seperate categories:
- Cards that I own to play with.
- Cards that I own as investments.
- Cards that I own (usually that I won or were drafted) that I'd like to trade for cards that will live in either category #1 or #2.
So, when I say I'm out on Modern, what I actually mean is that there are nearly zero Modern cards that I would categorieze as cards I own as investments. I can build several Modern decks that I like to play, and if some of those cards go up that would be great, but I own these cards as a cost of playing the game and not because I expect to make money off them. In fact, I strongly suspect they will lose money by the time I sell them.
There was a time when the majority of my portfolio was based around Modern cards: fetches, shocks, and staples. That was before the Dark Times, before the Empire...
Actually, it was before Modern Masters. I've been busy liquidating my Modern collection over the past several years. Luckily, I was able to get out of most of my cards at the right time and either collected the cash or traded into better investments.
The fact is that with Modern Masters always waiting in the weeds, it is only a matter of time before the [card]Wheel of Fortune saps the value out of even a well-picked investment. I'll still pick up a Modern card with a lot of short-term upside if I have the opportunity, I'm just not putting it in my long-term investments portfolio.
So What Do You Want to Invest In?
Isn't that the question that everybody is working on figuring out?
I have a two-part strategy for building up my collection:
- Penny stocks.
- Long-term holds.
Let's talk about both of these categories.
A Penny Stock Saved Is a Penny Stock Earned
It may seem boring and tedious, but I'm very, very solidly convinced that penny stocks are the best value in Magic. I'm not just talking about bulk rares, but cards that are in the less-than-$5 range. There are plenty of cheap cards that are every bit as powerful as expensive cards, which is to say they are only lacking the proper context to shine.
I love cards like these because they can be had for little investment but have a ton of potential upside. I've said it a million times on here while making picks: good cards are good.
The other nice upside of picking up misfit toys that don't have a current home is that they always do kind of have a home at the Kitchen Table or in Commander. Most of these types of cards will naturally float up in price based on the casual crowd, even if they don't find a home in Constructed.
Here's an example of what I'm talking about:
When Khans of Tarkir block rotated out of Standard, nobody wanted these guys anymore and the card basically became a bulk rare. I was able to pick a fair amount of these out a 4-for-$1 box several years ago. The thing is: Mantis Rider is a really powerful Magic card.
It has become a player in Modern Humans and though the price hasn't gone crazy, it was still an easy triple up.
Another good example of a card of which I bought a zillion copies for between $0.25 and $0.50 each:
These are now about $2 each and pretty reasonable to trade off. So basically, I'm always looking to cash out my store credit winnings on cards from the three-for-a dollar box or that retail for around $0.50 on TCGplayer. I've been doing this for years and years now and have built up a 4000-count box of speculative "value bulk rares" that I've basically hand-picked over time. It's all alphabetized. So, when some jank card spikes, I can simply pull it out of my box and trade it for value, and potentially reinvest into new cheap cards!
It's basically like the giving tree, but with Magic cards.
It's much easier for a $0.50 card to jump to $2.00 than it is for a $5.00 card to get to $10.00, which means that by investing in cheaper cards, it is easier to quad-up on profit than to double up on more expensive specs. The only downside is that you need to work in larger volumes, which doesn't have too much cost since the expense of buying in is so low.
Last but not least, and I cannot stress strongly enough how important these group of cards is: unique commander cards.
These are cards that typically only have one printing and tend to be pretty decent. They are also cards that can be very difficult for game stores to actually stock. I like picking these cards up whenever I can, as they have a tendency to be low cost with a lot of potential upsides. I've made a lot of money off speculating on Commander product singles, especially right after the decks are released. Stores have a habit of cracking decks just for the money cards and putting the "junk" into $0.50 boxes. I'll pull unique Commander cards to add to my 4000-card box/farm all day long.
Long-Term Specs – 'Til Death Do We Part
I consider myself to be a fairly savvy Magic player. I've played since 1995 and have seen dozens of formats come and go. I have a lot of experience being in and around the game.
With that in mind, I've simply learned to trust my gut when it comes to what Magic players want to own. I am a Magic player, and a damn fine one at that, so I trust that the cards I want to own for myself are the types of cards that other savvy players would also want to own.
I think that cards like the Power 9 and fancy dual lands are kind of a no-brainer. They hit all of the collecting high-water marks:
- They are on the Reserved List and thus safe from reprints.
- They are the best Magic cards ever printed.
- I need them in order to play Eternal Constructed.
We've seen these cards continue to steadily rise in price year after year with no slowing down in site. In fact, I think we may soon be in for another large spike on Revised dual lands. I think it is every player's eventual goal in Magic to be able to play Vintage or Legacy and to own some of the truly historic and iconic original game pieces. At least, any player who stays in the game long enough.
In the same vein as Reserved List Eternal Staples, I've also become quite fond of old cards. Anything from Beta, Arabian Nights, Antiquities and/or Legends. I really enjoy Old School Magic and I completely understand the drive to play a format like that and the absolute beauty of the format staples. I'm not at all surprised that speculators have targeted Old School cards very hard, and that those cards have become so desirable in recent years.
At the moment, I've been actively completing my Old School Battle Box. One of the reasons I began working on this project is that I wanted to collect a lot of the Old School cards before they got too expensive. It sort of set up a blueprint for acquiring one of every great Old School card across the board. I really enjoy owning cards like Beta Mahamotti Djinn or Royal Assassin. I also think these are great investment type cards for the long haul. Despite not being on the Reserved List, WOTC can't print more Alpha and Beta, which means these cards will always be special.
Six months ago, I wrote about how I was going hard after $10 to $30 Old School cards, because I didn't think that price group would exist in the near future. I was basically completely correct about that assessment. The window is closing on affordable Old School cards, and everything is becoming expensive.
So, I've discussed how the trends I've observed have helped dictate the way that I organize my strategy for investing in Magic. Reprints have led me away from investing in staples, particularly Modern cards. I love my penny stocks and invest in cards that I want to own long-term – because I believe that if I want them, others do as well.
Even in a marketplace that has become increasingly competitive to gain an edge, there is something to be said for working smart and acquiring what you enjoy.