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Night View 13.09.2021

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Alternative Investments: Sport Cards !

In the decade, the sports cards become more and more demanded due to multiple factors.  The sports cards golden age are the 80s and 90s. The nostalgia of this period is one of the reasons explaining the interest for trading cards as a cultural aspect related to their youth. In addition, as sports betting is now in an upward trend’s thanks digitalization of betting process, the sports cards also follow this tendency.

Investing in sports cards become more and more important both for ‘’fun’’ or for real profit seeking or diversification purposes. Then different strategies similar to financial investment in Stock are possible.

Different Strategies in sport cards investment:

Invest in old cards of old players are generally more a long-run investment as the current performance of an athlete or teams don’t affect the value of the cards. In this perspective, the main objective is to seek the more items of a particular players more particularly the icons in their sports (Jordans, Bryant, Babe Ruth etc … ). Generally, this type of investment require to identify the ‘’generation effect’’ (what players will be asked in the future ? ) and events celebrations (as exemple the 30th years of the fist title of a Teams ). This form of investment is also related to the Hobby or Collection Investments forms. It is then less risky but the cost of cards high.

At the opposite, the Flipping and Betting&Gambling investments are focus on short term as the value and profit are dependent of the Players current performances and status. These forms of investment require to be informed on the Sports results of each player and team. One of the strategies is to buy Rookie cards and sell them when the players be confirmed.  It is generally highly risky as the rookie cannot perform as expected but the Rookie cards are the most desirable items of Icons … so it is then very profitable. The Risk-Profit relationship of cards are similar to CAPM and Markowitz logic.

Different types of cards :

Like financial investment, sports cards are different categories. The cards is the basis and they are subdivided into Rookie Cards and Insert (a special cards present in a pack with a different desing more artistic than standards cards).

The Jersey Cards are very rare and contain a small part of the players jersey, the autograph cards are printed with the players autograph. Note that the autograph are printed on the cards but cars signed by the players himself are very scare and more expensive.

Error cards have also a great potential as they are rare and atypical due to a misprint.

The unopened cards packs and complete set of cards are also more valuable than the individual value of each card.

The value of a card:

The value of a cards is dependent to multiple factors:

An important point is the age of the cards as Vintage or Modern depending to the strategy of investment. Long-Run investors or collectors are more enthusiast with vintage cards while modern cards of current players are better for short-run investors.

Another important factor is the certified Grade evaluating the general condition of the cards.  The more the grade is high the more the value is high. However, the “raw” cards (non graded cards) have also potential both for beginners investors (lesser prices) and experts (possibility to buy a “raw” card to have them evaluated and grades by an agency). The condition of the card is important and attention should be placed on the surface, the corners, egdes, creases and centering.

The Name of the cards manufacturer is also important. The most well know firms are Panini. But depending the sports others cards company are targeted as exemple, Topps for official baseball cards or Upper Deck for Hockey.

To conclude all aspects related to  Players/Athele are important. Its performances (pasts, present and potential) , its cultural impact on its sports and on society (Jordans, Lebron James in Basketball, Muhammad Ali in Boxe, etc …) affect the value of the cards.

Some Figures:

The T206 PSA card of baseball player  Honus Wagner of 1909 was sold $6.606 Million in auction. It is the most expensive sport card.

The 1952 Topps cards of Mickey Mantle was sold $5.2 Millions.

The 2003-04 Rookie Patch with Autographg of LeBron James is also valued at $5.2 Millions.

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