For those who have never played any of the Diablo games from Blizzard-Activision, they are hack-and-slash dungeon crawlers. As is typical with these types of games, one's gear or items often plays a significant role in one's power level and ability to progress through the game.
A Bit of History
I began playing Diablo II the summer before I graduated college. A major medical issue put me in the hospital for a week and also kept me limited in terms of what I could do for about two months. One of the few things I could do during that time was play video games. A game showing a clear progression via leveling appealed to me greatly.
When I first got into the game, I picked up every item I found to sell to a vendor in town for gold if it didn't fit with any of my characters. The problem with this is that you can only use the gold in the game to buy things from vendor NPCs and the power level of buyable items quickly falls behind the power level of items you can find.
Magic Finance Lesson #1: Understand the Value of Your Time
I have a problem with Magic bulk. I love buying it but hate selling it. I try to squeeze every penny out of it, but there is a time cost to doing this. Whenever I pick up a collection, I dig through everything and pull out all cards that I know are worth something and all cards that have the potential to be worth something. The "potentials" go into a separate 5000-count box that is color sorted. The problem is that occasionally a card I wasn't expecting jumps in price so I go digging through my bulk again. While it may feel great pulling twenty copies of a card that has now jumped to $1 that I got for 1/3 of a cent, I have likely invested four hours into all that effort which means I am paying myself $5 an hour. As I have gotten older and started a family, the value of free time has grown exponentially and this type of "mining for diamonds" is no longer viable.
Managing Item Inventory in Diablo
The Diablo franchise, like most hack-and-slash dungeon crawlers, provides players with a limited "stash" to store items. The idea is that as your character progresses and you find better loot you no longer need to hold onto the old stuff. This encourages players to donate their old stuff to newer players. You are allowed to have multiple characters on an account so there is still plenty of storage in case you want to make another one and reuse some of that old gear or if you find something really cool for a build you might want to do or something niche that someone specific might want. That being said, with the original Diablo 2 one could just make multiple accounts and just have lots of storage characters. In Diablo 2 Resurrected, that is no longer an option. This forces players to be a lot more charitable and to be more cognizant of storage and what is truly worth its "stash space".
Magic Finance Lesson #2: There Is an Opportunity Cost to Storing
I already admitted to having a Magic bulk problem, but that problem extends beyond poor time vs money value to storage space. In the real world, space is not unlimited. There is a good reason that many of us see so many storage rental facilities while driving down the road. Many people are "collectors" and have a difficult time getting rid of the things they have accumulated over time. I am one of those people. I have over 200,000 bulk commons sorted by sets in my basement office. I haven't looked through 99% of those boxes in over a year.
If I take a step back from my "collector" viewpoint and instead look at my bulk pile from a "business" viewpoint, I can quickly see that I am losing a lot of money on storage. I could do other things with that space and I don't actively look for new bulk to pick the real diamonds out of because I have nowhere to put it. Thus, it sits collecting dust, providing no value, and serving as an eyesore in my office.
Markets For Diablo II Items Outside The Game Itself
This section may upset some "purists" of the game, but I admit to being an active user of D2JSP. This is a website that serves as the unofficial "auction house" for trading in-game items for the site's own digital currency forum gold. Before this site existed trading in the game was limited to creating a game and advertising what you had and or what you were looking for. This is a very inefficient method and prior to joining D2JSP, I struggled to progress in the game once I got to around level 25. The important part though is that one can exchange items for another form of currency outside the game that is accepted by thousands of other players and doesn't violate the game's own Terms of Service, unlike selling items for actual cash.
I have never once spent a dime buying forum gold and have acquired all of it via trading. I began accumulating forum gold by being responsive to people's search posts and selling whatever I found in order to build up a stash of forum gold to buy more expensive items. I quickly noticed that prices for the same items could often vary by 10-20%. I aggressively searched for the items I saw a lot of people asking for, buying them cheap and then reselling them for a modest profit. By doing this over and over, I was able to buy multiple versions of the best items in the game.
Magic Finance Lesson #3: Arbitrage Is Great, but the Window to Enjoy it is Often Short.
One of the easiest ways to make money is to look for market inefficiencies and take advantage of them. In the past, I would buy Commander cards from Japan, where the format isn't very popular. The stores would often mass open the Commander decks that had Legacy staples in them and then sell the remaining cards cheaply. Unfortunately, those stores must have picked up on the large orders of Commander cards to the US because the prices are now in line with TCGPlayer. I have also heard of European dealers who would come to the major US events and buy up cheap power and Vintage staples that they could turn around and sell at a premium when they got back home. This gets more difficult when "perfect" market information is available to both buyer and seller, which nowadays it typically is.
Managing The Massive Quantity of Items in Diablo II
There are a huge number of different items in the game and it's not possible to have every single one on any given account. I realized very quickly that it was easy to spread yourself too thin when you were buying and reselling items, which is why I focused on specific ones that I saw a lot of people asking for. I also noticed that players would pay for "graphic swaps" on items that had different graphics but the same stats. This opened up another revenue stream that didn't have any additional buy-in cost. The challenge was that typically people would want to swap multiples at a time for the same graphic and finding another player wanting the opposite graphics was nearly impossible.
I realized that if I gathered multiple of each item in each graphic I could pretty easily do lots of trades between people looking for one graphic or another. This focus also meant that players would message me requesting specific items with specific graphics and we would agree on a price ahead of time and I would message them once I had the item. This essentially allowed me to presell things and my profit based on whatever the cheapest option that met the requirements cost.
Magic Finance Lesson #4: There is Such a Thing as "Too Diverse" When It Comes to an Inventory.
When I first started dealing in Magic Finance I would buy cards for all formats. I had a lot of free time to follow metagames for Modern, Legacy, and Standard, and I played a lot of Commander as well. As I have grown older, my free time has ebbed considerably and I can't keep my finger on the pulse of every format. I now only buy cards with an eye on Commander desirability. In fact, the last Modern-specific cards I purchased are still in my store inventory six months later.
It is crucial to understand that most of us are resource-limited at all times. While the amount and type of said resource can vary, that truth is still universal. This is especially true when your Magic finance business is not your main source of income. I have a 9-5 job and family duties that take priority over operating my TCGPlayer store, so I devote less and less time to the store. I sacrifice income for free time and I am always trying to create efficiencies to minimize that store time even more, although I am at the point where I am happy with how little time I have to devote to it versus how much additional income it brings in per year.
The End Step
While it might not seem like there is significant overlap between a video game and Magic outside of the fantasy setting; it can be beneficial to look at things from a broader perspective. By looking for the bigger picture, and trying to find the overlaps, we are training our brains to find patterns. In doing so, the hope is that we can see with a clearer mental vision, and make better decisions moving forward. This sounds like a good mindset to have as we enter a new year. I hope everyone has a safe and happy New Year's Eve and got to enjoy some time together with loved ones over the holidays.