Investing in Collectibles - Is it dumb?

[poxpower]

I wrote an article on the category of collectibles I'm somewhat heavily invested in:
https://www.thepoxbox.com/posts/investing-in-collectibles-is-it-dumb

Maybe you guys will find it interesting.

I'm also curious to know if anyone else here does this and what you're investing in and how it worked out for you.

[onecoolcat]

I have MTG and Pokemon booster boxes that I speculated on from 2019 to present.  Most of its just slowly growing - probably about 7% per year but there are a few notable exceptions that are crushing it and which skew my gains to the positive.  For instance, my first spec was Pokemon Evolutions (2016) booster boxes which I bought in 2019.  I bought boxes at $93 per.  No one wanted them at the time.  However, I had a inkling that they could go up in value because the set is like a re-imagination of the original Base Set that got all of us 30-somethings hooked on Pokemon back in the day, I still had a fondness for the OG Pokemon from my childhood and figured others must as well, and I noticed the cards from 1999 had steadily increased in value since 2014 when I started rebuilding my collection.  The OG cards from our childhood were becoming more and more expensive and I speculated that people may want to relive the feeling from their childhood by cracking a pack in chase of the Zard.  Little did I know the price of those boxes would do a near 10x in just two years.  I sold some when I tripled my money and kept the rest.  They are sitting at $750-800 now and I plan on holding them for a very long time.  My goal with my TCG collectibles is to just beat the S&P 500 index after account for all fees.  Its a very small portion of my investments. 

[Rob_bob]

I wouldn't consider collectables an investment, to me it's a hobby that may or may not make money at some time.

I have some common date uncirculated U.S. coins, I bought them years ago when the market was hot.  I don't even know the current value but some years ago I checked the value of some of them and the value was so much less than what I paid I would have been embarrassed to say what I paid.

I have a collection of old clocks I bought them because I like them, not to make money, but they will likely go up in value as antiques.  Guns probably hold their value and increase in value more predictably than many items, unless you are into fine art from the old masters but the buy in price is pretty substantial LOL.

[poxpower]

I have MTG and Pokemon booster boxes that I speculated on from 2019 to present.  Most of its just slowly growing - probably about 7% per year but there are a few notable exceptions that are crushing it and which skew my gains to the positive.  For instance, my first spec was Pokemon Evolutions (2016) booster boxes which I bought in 2019.  I bought boxes at $93 per.  No one wanted them at the time.  However, I had a inkling that they could go up in value because the set is like a re-imagination of the original Base Set that got all of us 30-somethings hooked on Pokemon back in the day, I still had a fondness for the OG Pokemon from my childhood and figured others must as well, and I noticed the cards from 1999 had steadily increased in value since 2014 when I started rebuilding my collection.  The OG cards from our childhood were becoming more and more expensive and I speculated that people may want to relive the feeling from their childhood by cracking a pack in chase of the Zard.  Little did I know the price of those boxes would do a near 10x in just two years.  I sold some when I tripled my money and kept the rest.  They are sitting at $750-800 now and I plan on holding them for a very long time.  My goal with my TCG collectibles is to just beat the S&P 500 index after account for all fees.  Its a very small portion of my investments.

Didn't pokemon just kind of crash because a lot of the value increase was driven purely by flippers?

I'd be interested to see how pokemon did vs the SP500.

[harvestbook]

Collectibles (well, many of them--jury's out on NFT and I'd consider crypto a digital collectible) that have a long track record can be valid as speculative assets but they are always speculative. You need a greater fool to come along.

I've been in and out of sports cards and comics several times, getting pretty serious about it in 2020. Lo and behold it turns out I was just part of a mania. I had a goal of 5 percent of my net worth to put into high-grade vintage basketball cards and pretty much met it with a collection I am pleased with. After owning a shop and dealing the 1990s and ending up with an attic of junk, this time I wanted a couple of solid shoeboxes worth of classics.

And here comes the market crash as inflation eats paychecks and we've not even hit the recession/job loss stage yet when there will be a rush for the exits. So I discount everything that's happened since the pandemic started, since it looks like every asset class was inflated. I was buying and selling the entire time--I mostly quit buying in 2021 when prices seemed insane to me, but early this year I capped off my collection with two grail cards (Bill Russell and George Mikan rookies) at around $9k each, so now I'm mostly done.

I consider it a hobby first and foremost. Buying right now as an "investment" is foolish in my view. If you love it and your kids aren't going hungry, I say go for it. There are dumber hobbies and dumber ways to spend money. But I wouldn't be at all shocked if prices drop to pre-2019 levels or lower. I'm keeping mine so I couldn't care less. If they bottomed out I would buy some multiples of really high-grade older cards but I moved on to a much cheaper hobby now, although I still sell some nickel-dimer stuff for fun. Every card I sell now goes into iBonds, not more cards.

People started running charts on cards like they are stocks or something, with the same "price support" and return projection nonsense. That to me was a red flag. A lot of pumpers at work, and a lot of influential people manipulating the market by shifting what is "hot." They'll be on to other things soon for easier money.

So...not dumb. Not necessarily smart, either.

And it's not free money. You still have to work.

[HPstache]

I also got back in to sports cards collecting during the pandemic. So far I have made a few thousand dollars while picking up a few long term hold cards.  There was definitely a bubble that popped last year, but I was churning cards fast enough that I barely felt it.

In my opinion,  graded cards are the only real investment now adays, raw (ungraded) is worth something but I dont feel like that is a real investment class.  I dont really follow pokemon, but PSA (the most respected grader with the longest history) is a decent website to track the sales history for a card.  Knowing so little about pokemon, I can link two cards from 1999 first edition that shows sales history since 2016 to get an idea as to how it's done vs. The S&P, at the very bottom you can see a graph of the sale prices, this is actual data from eBay and auction houses:

https://www.psacard.com/auctionprices/tcg-cards/1999-pokemon-game/pikachu/values/544077#g=10

https://www.psacard.com/auctionprices/tcg-cards/1999-pokemon-game/charizard-holo/values/544028#g=9

[YttriumNitrate]

My general rule is that anything sold as a "collectible" is going to be a lousy investment.

Now, if you really want to invest in collectibles, figure out what the 10-year old kids are actually playing with today, buy a bunch, and sell it to them in 15+ years when they have tons of disposable income, few responsibilities, and want to relive part of their childhood.

[poxpower]

I consider it a hobby first and foremost. Buying right now as an "investment" is foolish in my view.

Well over the 27 years that Magic has existed, every year people said this and now it's year 25 ish of this collectible beating indexes.
Isn't that mind blowing?
I kind of really didn't even believe it myself haha. Like you I figured "meh it'll be for fun" but if you really just set your mind to investing in "holy grail" type cards you just destroyed index investing going on a 20 years streak.

So I really am wondering if magic is unique even among the "good" collectibles or if some other collectibles did this, i.e. just dump on the stock market for 20 years.

There's tons and tons of examples of 1-2 year little bursts but they all kind of flatten out over time and also suffer from "If you didn't buy it when it came out, it sucks" problem. But Magic didn't behave that way at all so far.

Like if you did buy it when it came out then you destroyed the stock market at like Bitcoin levels. But if you just bought into it later on then you "just" got in the range of 10-25% returns... That's sick. 25% return for 20 straight years? Like. Damn.

[waltworks]

I had, briefly, a mid-5 figure net worth as a teenager in the 1990s from "investing" in comic books. I probably spent $5k of my own money scrounged from summer jobs and allowance and such on this endeavor over several years.

I was an original HODLer, though, so when I finally sold them all during a move in 2012, I got a grand total of $150 (and was happy to get it and not have to pay to dispose of the damn things).

Collecting stuff is a hobby. Hobbies can be profitable to some extent, but they start becoming more like poorly paid jobs/running a small business at some point if you're really trying to monetize them. As such, in my book, they're never really "investments".

-W

[poxpower]

In my opinion,  graded cards are the only real investment now adays,

How did sports card do over the long term? Did anyone track that?
Like if you just buy and held the "obvious" ones from 1960,1970 etc.

My general rule is that anything sold as a "collectible" is going to be a lousy investment.

Now, if you really want to invest in collectibles, figure out what the 10-year old kids are actually playing with today, buy a bunch, and sell it to them in 15+ years when they have tons of disposable income, few responsibilities, and want to relive part of their childhood.

I don't think there's any way to guess what will become collectible down the line. There's more stuff from our childhood that's worthless then stuff that became desirable.
My interest is more about the things that became established as long-term value holders and how those did.

I see some people made money with flipping but I consider that a job not really an investment.

But you could just have parked 20k in magic in 2010 and then sell out again in one transaction in 2020 or 2030. Very minimal work and so far at least completely destroyed index investing.

Really just fascinating but might be a complete and total once-in-a-century outlier collectible, I have no idea.

[poxpower]

Collecting stuff is a hobby. Hobbies can be profitable to some extent, but they start becoming more like poorly paid jobs/running a small business at some point if you're really trying to monetize them. As such, in my book, they're never really "investments".

Yes but that's "flipping" like that dude who traded a paperclip into a house :p
So not investing in my opinion.

I did the math for just "buy and hold" in my article and you would see that Magic has crushed the SP500 for 25 years running. That's mind blowing to me.

[waltworks]

I did the math for just "buy and hold" in my article and you would see that Magic has crushed the SP500 for 25 years running. That's mind blowing to me.

Lots of individual things (pieces of real estate, other collectibles/works of art, even some publicly traded stocks, along with all sorts of other stuff) beat the S&P handily too. That's what you expect given a huge number of potential "investments".

It's not useful or helpful to look at outliers and then make generalizations about a class of things, though, because if you just bought multiples of every form of trading card/card game in existence for the last 25 years, you'd have done terribly. If you bought everything in the Russell 2000 (or just some VTSAX), on the other hand, you'd have done pretty well. Just as I would not say anything about stock investing based on the performance of Monster Energy (up like 90,000% in the last 20 years, I think?) it's silly to say anything about collectibles based on one extreme example.

My 1990-92 $5k of summer job money spent on comic books that turned into $150 could have been worth $100k today if I'd dumped it into the S&P500, if you want to look at extreme examples!

There's also the greater fool problem. Kids 10 years from now might not like Magic anymore (I have no idea if they do now), and if the pool of new "investors" dries up, what then? The cards don't generate any dividends or produce any tangible benefit (other than fun, assuming you actually play the game with your $10k deck) for the owner. So you're counting on the game staying popular and more and more people wanting the cards, which if you look at the history of children's entertainment, seems like a bad bet.

-W

[Psychstache]

I played MTG for a number of years, has some mild success on the GP/PT/SCG circuit, worked for multiple of the big name singles sellers, wrote articles for money, collecting, and for a time made most of my money by 'day trading' cards at large events. I eventually sold out of both paper and digital and used the money to do things like pay off my car and support the downpayment of my house. Just a background for where I am coming from.

MTG seems to be the weird exception to the rule, and I think there are a number of reasons for that I am not really gong to dig into. Here's a quick example though:

For a quick real world data piece for individuals not as familiar, a Beta Edition Tropical Island sold for on average $662.40 in November 2010. In November 2020, it was up to $3395.90. That's a CARG of 18% over 10 years. Reference:

https://www.mtggoldfish.com/price/Limited+Edition+Beta/Tropical+Island#paper

I don't have data to back it up, but I recall back in my day picking up Tropical Islands in the mid-late 90s for about $20-40 bucks each depending on the condition, so the true CARG could definitely be bananas.


In general, my experience and opinion is that MTG can function as an investment in 2 different ways:

1. you are effectively a day trader requiring lots of time and energy (keeping up with current format markets, travelling to events to buy/sell, looking out for banned/restricted announcements like a hawk, etc)
2. you are a long term holder of a somewhat illiquid long term play that is likely good provide returns, but carries some black swan risk greater than the stock market (WotC kills the reserve list, MTG paper dies and only digital is supported, you are identified as a high end collector and get robbed, etc).

Either way, I can see the potential, but I am no longer interested in the market.

[Psychstache]

There's also the greater fool problem. Kids 10 years from now might not like Magic anymore (I have no idea if they do now), and if the pool of new "investors" dries up, what then? The cards don't generate any dividends or produce any tangible benefit (other than fun, assuming you actually play the game with your $10k deck) for the owner. So you're counting on the game staying popular and more and more people wanting the cards, which if you look at the history of children's entertainment, seems like a bad bet.

-W

This is a fundamental misunderstanding of where the investment prospect lies. We are not talking about children's entertainment when it comes to Vintage legal reserve list cards, just in the same way we are not talking about 7 year olds when it comes to the Vintage Jordan's market.

[waltworks]

This is a fundamental misunderstanding of where the investment prospect lies. We are not talking about children's entertainment when it comes to Vintage legal reserve list cards, just in the same way we are not talking about 7 year olds when it comes to the Vintage Jordan's market.

Sure you are. If kids lose interest in basketball (or even just in the idea of collecting shoes), and no new buyers enter the market for Jordans, then as time goes by there will be more sellers (liquidated by heirs after death, sold to cover other financial needs, lost interest, freaked out when shoes didn't gain value, etc) than buyers and the value of the shoes will collapse.

I mean, I have literally watched this happen several times (and participated in one such collapse) with sports cards, comics, pogs (remember pogs?), and of course the infamous beanie babies. 

Again, you can make money with collectibles if you have time and knowledge of the item(s). I'm not disputing that. Comparing to investing in index funds is apples to oranges, though, in terms of expected outcomes/risk, scalability, and required effort. 

-W

[FLBiker]

Personally, investing in collectibles (whether physical or digital) is not interesting to me.  First of all, I don't really like owning stuff.  Second, I'm interested in investments that reliably make money, ideally without requiring special knowledge, luck, or timing.  I understand and fully accept that, in hindsight, there will undoubtedly be lots of ways I could have made more money.  The real appeal of this forum and others like it, though, is the reproducibility of it.  I'm confident telling people just starting to work today -- if you save 40-60% of your income in low cost index funds, taking advantage of tax-sheltered accounts where you can, you'll be able to retire in your 40s.  I wouldn't be confident telling them that about any collectible.

[Psychstache]

Again, you can make money with collectibles if you have time and knowledge of the item(s). I'm not disputing that. Comparing to investing in index funds is apples to oranges, though, in terms of expected outcomes/risk, scalability, and required effort. 

-W

I would agree with this. I would say it is more comparable to active investing, but with less regulation and security.

[waltworks]

Agreed. Want to amend your first few posts to remove the S&P/indexing references, then?

-W

[JAYSLOL]

Collecting stuff is a hobby. Hobbies can be profitable to some extent, but they start becoming more like poorly paid jobs/running a small business at some point if you're really trying to monetize them. As such, in my book, they're never really "investments".

Yes but that's "flipping" like that dude who traded a paperclip into a house :p
So not investing in my opinion.

I did the math for just "buy and hold" in my article and you would see that Magic has crushed the SP500 for 25 years running. That's mind blowing to me.

Sure, but that’s almost exactly like saying “25 years ago I bought Apple Stock and it’s crushed the S&P500 over 25 years”.  That can be true, but how many tech stocks didn’t crush the S&P500?  And likewise, how many cards/card games in the 90’s could you have bought that also wouldn’t have crushed the S&P500?  The other difference is of course is that the S&P500 has actual earnings to back up its value, and not just the demand for the sake of owning shares.  That said, I dabble in coin collecting and buying and selling other collectibles, it’s a fun hobby, and the more you learn the more potential there is to make a ton of money either short or long term speculating in things. 

[AlanStache]

I have half thought about buying and holding un-opened Lego kits to resell 5-10 years after the run ends.  But the risk and hassle just seemed like not worth it.  Buying +3k$ of Lego a year and storing them in my spar room would end up taking a lot of space after a while, then fire/flood and then I need a good reputation on ebay/etc to sell them down the line.  Might be sort of fun but just not that into it.

[HPstache]

I have half thought about buying and holding un-opened Lego kits to resell 5-10 years after the run ends.  But the risk and hassle just seemed like not worth it.  Buying +3k$ of Lego a year and storing them in my spar room would end up taking a lot of space after a while, then fire/flood and then I need a good reputation on ebay/etc to sell them down the line.  Might be sort of fun but just not that into it.

Plus, you have to practice the self control of not opening them! :)

[AlanStache]

I have half thought about buying and holding un-opened Lego kits to resell 5-10 years after the run ends.  But the risk and hassle just seemed like not worth it.  Buying +3k$ of Lego a year and storing them in my spar room would end up taking a lot of space after a while, then fire/flood and then I need a good reputation on ebay/etc to sell them down the line.  Might be sort of fun but just not that into it.

Plus, you have to practice the self control of not opening them! :)

No, would definitely get one extra to build and play with  :-)   I try to hold myself to one big-expensive set every year or two.

[PDXTabs]

Again, you can make money with collectibles if you have time and knowledge of the item(s). I'm not disputing that. Comparing to investing in index funds is apples to oranges, though, in terms of expected outcomes/risk, scalability, and required effort. 

-W

I would agree with this. I would say it is more comparable to active investing, but with less regulation and security.

I don't invest in collectibles, but I did play MTG in the 1990s. I would compare collectibles with private stock investments with no single exchange where you can check pricing.

[Telecaster]

I don't invest in collectibles, but I did play MTG in the 1990s. I would compare collectibles with private stock investments with no single exchange where you can check pricing.

And the underlying asset has no intrinsic earnings.  With stocks, either individual stocks or the broader market, you should be able to come up with some reasonable estimate of future price based on future earnings.  With collectables, the future price is based solely on the number and enthusiasm of people who want to own that collectable in the future. 

[onecoolcat]

I have MTG and Pokemon booster boxes that I speculated on from 2019 to present.  Most of its just slowly growing - probably about 7% per year but there are a few notable exceptions that are crushing it and which skew my gains to the positive.  For instance, my first spec was Pokemon Evolutions (2016) booster boxes which I bought in 2019.  I bought boxes at $93 per.  No one wanted them at the time.  However, I had a inkling that they could go up in value because the set is like a re-imagination of the original Base Set that got all of us 30-somethings hooked on Pokemon back in the day, I still had a fondness for the OG Pokemon from my childhood and figured others must as well, and I noticed the cards from 1999 had steadily increased in value since 2014 when I started rebuilding my collection.  The OG cards from our childhood were becoming more and more expensive and I speculated that people may want to relive the feeling from their childhood by cracking a pack in chase of the Zard.  Little did I know the price of those boxes would do a near 10x in just two years.  I sold some when I tripled my money and kept the rest.  They are sitting at $750-800 now and I plan on holding them for a very long time.  My goal with my TCG collectibles is to just beat the S&P 500 index after account for all fees.  Its a very small portion of my investments.

Didn't pokemon just kind of crash because a lot of the value increase was driven purely by flippers?

I'd be interested to see how pokemon did vs the SP500.

I don't think so.  I just updated my numbers for the first time in a year and the values went up for everything older than 1-year.

[waltworks]

Advice from the old guy who already played this game and lost: get out while you're way ahead, or even a little ahead. Don't do the cargo bike ride of shame to the only comic book store left in town to sell your prized collection for (yes, no joke) under $1 a pound.

If I had a box of Pokemon cards that had mysteriously gone up 10x in value during Covid when all sorts of useless things went up in value like crazy, I'd be taking a VERY hard look at selling ASAP.

Good luck!

-W

[Chris Pascale]

I don't invest in them, but have a bin of cards from the 80's and 90's, plus the Archie's I read thoroughly, and so have my kids.

During the craze of people getting rich off their old baseball cards, the "Superman's Dead" issue came out. I bought 2. One to read and one to keep in the sealed plastic.

Is it dumb? It's as dumb is keeping pictures of men you don't know and maintaining intimate knowledge of them.

But you might get to trade them for pictures of other men - dead presidents - and lots of them.

[AccidentialMustache]

I have half thought about buying and holding un-opened Lego kits to resell 5-10 years after the run ends.  But the risk and hassle just seemed like not worth it.  Buying +3k$ of Lego a year and storing them in my spar room would end up taking a lot of space after a while, then fire/flood and then I need a good reputation on ebay/etc to sell them down the line.  Might be sort of fun but just not that into it.

Plus, you have to practice the self control of not opening them! :)

If you picked the correct sets at the correct time, even opened, they are worth more than they cost originally. https://brickset.com/sets/10182-1/Cafe-Corner as an example -- $140 in 2007, now worth ~800 (don't believe the $1k it suggests, you have to click through to bricklink and look at the sales).

The big problem with Lego sets as investment is more realistically the limited market. Sure the average new sale price is $2k or higher. That's fantastic... but they sold (new) at a 1/month rate and there's 14 for sale. Will you get the sale? Will Lego re-release it and crash the value? Has everyone found out about Lego-as-investment and there's a hundred people waiting 10 years like you are, only to discover each other as you compete for the lowest price so you can make the sale?

The good thing about Lego is there's always a kid in your life that would love them as a gift. If you lack kids in your life somehow, there are plenty of charities who'd be happy with a set or dozen to give kids at the holidays (or to auction off and use the dollars for whatever else they do).

[harvestbook]

Advice from the old guy who already played this game and lost: get out while you're way ahead, or even a little ahead. Don't do the cargo bike ride of shame to the only comic book store left in town to sell your prized collection for (yes, no joke) under $1 a pound.

If I had a box of Pokemon cards that had mysteriously gone up 10x in value during Covid when all sorts of useless things went up in value like crazy, I'd be taking a VERY hard look at selling ASAP.

Yep, pick 2021/2022 as the end date for lots of things and 20 to 25 years ago as a starting point and they look like no-brainer "investments." I notice card people never mention their losers. So IF you only bought the one thing that did great, you can consider yourself a genius but most likely you were just lucky.

Upper Deck Ken Griffey Jr. rookie cards were hot in 1989-- going for over $100 with ease. After the 90s crash they were 10 bucks for a couple of decades because there are at least a million of them printed, and probably 2 million. Then lo and behold a pandemic bubble sends them skyrocketing again.

I had some junk wax in the attic that I'd bought for $8-10 a box. I'd given away cases and cases of that stuff to children's charities, but when it hit $30 I dumped it all as fast as I could. Shockingly, some of that junk was going for $150-200 a box in 2021. I am utterly convinced it's still only worth $10 and will be so in 2025.

I always say I doubt I will live long enough for another major bubble so there's not much point in trying to hoard for money. If my cards go to zero my life doesn't fundamentally change because it's a hobby.

Oh yeah and then pay seller fees, postage and insurance for more expensive items, and then you get to pay either collectibles tax, cap gains tax, or self-employment tax depending on how you handle it. It's certainly a job and not a hobby at that point. I guess you can do cash only at shows and pocket it, but again, that's work.

Obviously there is money to be made in lots of things but not without time, expertise, commitment, education, effort, risk and...luck.

[Fishindude]

Firearms hold their value pretty well and some have appreciated rather well, so they are pretty legit collectibles.
 

[waltworks]

Firearms hold their value pretty well and some have appreciated rather well, so they are pretty legit collectibles.

It will be interesting to see what happens as the boomers die off, though. My FIL has a bunch of fancy guns of various kinds, some of them collectible, I think. Nobody in the family wants anything to do with them, as none of us hunt or shoot in any meaningful way and hence aren't interested in guns (though I do have a thing for nice biathlon rifles), and certainly aren't interested in gun safes full of old guns gathering dust in our basements.

I know other family patriarch types in similar situations. So my instinct is that gun collecting skews really, really old at this point. Those guns will all hit the market and tank their value pretty fast if there aren't a bunch of young folks waiting to buy them.

-W

[YttriumNitrate]

It will be interesting to see what happens as the boomers die off, though. My FIL has a bunch of fancy guns of various kinds, some of them collectible, I think. Nobody in the family wants anything to do with them, as none of us hunt or shoot in any meaningful way and hence aren't interested in guns (though I do have a thing for nice biathlon rifles), and certainly aren't interested in gun safes full of old guns gathering dust in our basements.

My guess would be that the gun collecting market will follow the 50s/60s muscle car market, but trail by about a decade. One thing gun collecting has going for it is that it doesn't take up a huge amount of space so boomers can take their guns with them as they downsize to a smaller retirement house. A collection of cars will be harder to fit in a 2 bedroom bungalow.

[Michael in ABQ]

It will be interesting to see what happens as the boomers die off, though. My FIL has a bunch of fancy guns of various kinds, some of them collectible, I think. Nobody in the family wants anything to do with them, as none of us hunt or shoot in any meaningful way and hence aren't interested in guns (though I do have a thing for nice biathlon rifles), and certainly aren't interested in gun safes full of old guns gathering dust in our basements.

My guess would be that the gun collecting market will follow the 50s/60s muscle car market, but trail by about a decade. One thing gun collecting has going for it is that it doesn't take up a huge amount of space so boomers can take their guns with them as they downsize to a smaller retirement house. A collection of cars will be harder to fit in a 2 bedroom bungalow.

Also, an old gun will typically stay in good condition with minimal maintenance. It's just metal and wood for the most part. Old cars.... not so much. My dad has a 1950s Jaguar that he bought back in the 1960s for several thousand dollars. It's probably worth $60-80k at this point. However, he has been pouring money into maintenance on that car my whole life. Even the most minor things like an oil change costs hundreds or thousands of dollars because there's only a handful of mechanics that are familiar with old British cars and any parts are very expensive since there's a limited supply - or they're newly manufactured and priced very high due to the limited production runs. It was his first car though, so a lot of sentimental value tied up in it. He's at the upper end of boomers, so I could definitely see prices tanking in another decade or two as anyone old enough to have an attachment to that type of vehicle, will be too old to still drive it (or dead).

[waltworks]

It will be interesting to see what happens as the boomers die off, though. My FIL has a bunch of fancy guns of various kinds, some of them collectible, I think. Nobody in the family wants anything to do with them, as none of us hunt or shoot in any meaningful way and hence aren't interested in guns (though I do have a thing for nice biathlon rifles), and certainly aren't interested in gun safes full of old guns gathering dust in our basements.

My guess would be that the gun collecting market will follow the 50s/60s muscle car market, but trail by about a decade. One thing gun collecting has going for it is that it doesn't take up a huge amount of space so boomers can take their guns with them as they downsize to a smaller retirement house. A collection of cars will be harder to fit in a 2 bedroom bungalow.

Interestingly he's into those too. I have suffered through a few car shows and the demographic is insane - average age of the owners has to be 80 or 85.

-W

[Michael in ABQ]

It will be interesting to see what happens as the boomers die off, though. My FIL has a bunch of fancy guns of various kinds, some of them collectible, I think. Nobody in the family wants anything to do with them, as none of us hunt or shoot in any meaningful way and hence aren't interested in guns (though I do have a thing for nice biathlon rifles), and certainly aren't interested in gun safes full of old guns gathering dust in our basements.

My guess would be that the gun collecting market will follow the 50s/60s muscle car market, but trail by about a decade. One thing gun collecting has going for it is that it doesn't take up a huge amount of space so boomers can take their guns with them as they downsize to a smaller retirement house. A collection of cars will be harder to fit in a 2 bedroom bungalow.

Interestingly he's into those too. I have suffered through a few car shows and the demographic is insane - average age of the owners has to be 80 or 85.

-W

Maybe I should try to convince my dad to sell his old car. I think there is a serious risk that the collectors with money are going to either die or get too old to be able to drive. My dad is probably pretty close to the point of not being able to drive it anyways.

[AlanStache]

...
Maybe I should try to convince my dad to sell his old car. I think there is a serious risk that the collectors with money are going to either die or get too old to be able to drive. My dad is probably pretty close to the point of not being able to drive it anyways.

Careful that older generation is VERY protective of there 'right' to drive.  Might be best to frame it as him trying to find a collector who will appreciate it now vs having to sell to whoever can pick it up this week sometime down the line. 

My employers founder (~98yo) lives in a very nice apartment complex in Miami with lots of other older retirees, am told the parking garage is full of cool cars that are never driven. 

[waltworks]

I think it's worth noting that it's simultaneously useful and problematic to have insider knowledge of the collectible you're "investing" in.

On the plus side, when I was collecting comics, I had a virtual price sheet in my head and could grade a comic pretty accurately by eye. I knew the coolest artists/writers/characters and knew when they were going in/out of favor, as well as knowing the old classics well enough that I could recognize a good deal from some kid who didn't know why an old silver age book would be worth anything.

On the other hand, I was so wrapped up in that world that it was *inconceivable* to me that comics could lose their value or that the market was just a bunch of speculators. I pretty much hung out with other comic book nerds, I read comics and about comics, and there just weren't any dissenting voices around to say, "you know, maybe you would be better off with $60k right now than all those comics you keep in plastic and don't even read - are you sure having multiple copies of a comic that Marvel printed several million of is going to be a good investment?"

I mean, it took me 20 years to capitulate, really. I dragged those damn things all over the place with me. Periodically I'd check on prices, shake my head, and then keep holding on.

If you have the knowledge, you have to be really careful about being in an information bubble at the same time.

-W

[HPstache]

I think it's worth noting that it's simultaneously useful and problematic to have insider knowledge of the collectible you're "investing" in.

On the plus side, when I was collecting comics, I had a virtual price sheet in my head and could grade a comic pretty accurately by eye. I knew the coolest artists/writers/characters and knew when they were going in/out of favor, as well as knowing the old classics well enough that I could recognize a good deal from some kid who didn't know why an old silver age book would be worth anything.

On the other hand, I was so wrapped up in that world that it was *inconceivable* to me that comics could lose their value or that the market was just a bunch of speculators. I pretty much hung out with other comic book nerds, I read comics and about comics, and there just weren't any dissenting voices around to say, "you know, maybe you would be better off with $60k right now than all those comics you keep in plastic and don't even read - are you sure having multiple copies of a comic that Marvel printed several million of is going to be a good investment?"

I mean, it took me 20 years to capitulate, really. I dragged those damn things all over the place with me. Periodically I'd check on prices, shake my head, and then keep holding on.

If you have the knowledge, you have to be really careful about being in an information bubble at the same time.

-W

I'll say that in my opinion the collectibles world is completely different now a days with the internet and, specifically, eBay.  eBay gets you in touch with all the other nerds out there who are interested in buying and selling the same things you are, you aren't limited to your geographical region / group of friends.  I think that it would be much harder to see see a fast crash like you experienced with comic books... and in  fact, you might find that some of the comic books you could hardly give away probably stood the test of time and are worth something on eBay yet today had you held them.  I do 100% get what you're saying though because as a kid in the early 90's I totally collected baseball cards and ended up with a Rubbermaid tote full of them that were called "junk wax" for 3 decades, they were as good as fire starters for the longest time.  Well, eBay changed a lot of that and although most of them are still junk, high graded versions of for instance the 1989 Upper Deck Ken Griffey Jr RC are worth $2K all day every day.  A 1993 SP Derek Jeter is a 6-figure card graded PSA 10.  both of these cards were not like a secret card in the 90's that people got lucky with, they were the best known cards to hold at that time too.  I'm just rambling, but I guess what I am trying to say is that the internet has really changed collectibles.

[Michael in ABQ]

...
Maybe I should try to convince my dad to sell his old car. I think there is a serious risk that the collectors with money are going to either die or get too old to be able to drive. My dad is probably pretty close to the point of not being able to drive it anyways.

Careful that older generation is VERY protective of there 'right' to drive.  Might be best to frame it as him trying to find a collector who will appreciate it now vs having to sell to whoever can pick it up this week sometime down the line. 

My employers founder (~98yo) lives in a very nice apartment complex in Miami with lots of other older retirees, am told the parking garage is full of cool cars that are never driven.

He has a second old British car that runs better - and is actually more fun to drive. Plus a normal newer car that he and my mom both drive. The two nice old cars sit in the garage and get driven once a month on average (probably less). My parents have a paid off house and decent amount of money (he sold off some other toys like a sailboat and a farm several years ago). But $60-70k now would be worth a lot more than maybe $30-40k 10 years from now if prices tank - and if he's still alive to enjoy it.

[AlanStache]

...

I'll say that in my opinion the collectibles world is completely different now a days with the internet and, specifically, eBay.  eBay gets you in touch with all the other nerds out there who are interested in buying and selling the same things you are, you aren't limited to your geographical region / group of friends.  I think that it would be much harder to see see a fast crash like you experienced with comic books... and in  fact, you might find that some of the comic books you could hardly give away probably stood the test of time and are worth something on eBay yet today had you held them.  I do 100% get what you're saying though because as a kid in the early 90's I totally collected baseball cards and ended up with a Rubbermaid tote full of them that were called "junk wax" for 3 decades, they were as good as fire starters for the longest time.  Well, eBay changed a lot of that and although most of them are still junk, high graded versions of for instance the 1989 Upper Deck Ken Griffey Jr RC are worth $2K all day every day.  A 1993 SP Derek Jeter is a 6-figure card graded PSA 10.  both of these cards were not like a secret card in the 90's that people got lucky with, they were the best known cards to hold at that time too.  I'm just rambling, but I guess what I am trying to say is that the internet has really changed collectibles.

How much as the internet changed gun collecting?  I (think) ebay etc are no-gun sites, I assume the equivalent exist for guns that can help with sales and transfers? 

"old British car" have seen with airplane where someone sells at "friend prices" with the provision they can still take it out X times a year.  sellers gets it off there books but can still enjoy it a few more times - is an easier mental transition too. 

[HPstache]

...

I'll say that in my opinion the collectibles world is completely different now a days with the internet and, specifically, eBay.  eBay gets you in touch with all the other nerds out there who are interested in buying and selling the same things you are, you aren't limited to your geographical region / group of friends.  I think that it would be much harder to see see a fast crash like you experienced with comic books... and in  fact, you might find that some of the comic books you could hardly give away probably stood the test of time and are worth something on eBay yet today had you held them.  I do 100% get what you're saying though because as a kid in the early 90's I totally collected baseball cards and ended up with a Rubbermaid tote full of them that were called "junk wax" for 3 decades, they were as good as fire starters for the longest time.  Well, eBay changed a lot of that and although most of them are still junk, high graded versions of for instance the 1989 Upper Deck Ken Griffey Jr RC are worth $2K all day every day.  A 1993 SP Derek Jeter is a 6-figure card graded PSA 10.  both of these cards were not like a secret card in the 90's that people got lucky with, they were the best known cards to hold at that time too.  I'm just rambling, but I guess what I am trying to say is that the internet has really changed collectibles.

How much as the internet changed gun collecting?  I (think) ebay etc are no-gun sites, I assume the equivalent exist for guns that can help with sales and transfers? 

"old British car" have seen with airplane where someone sells at "friend prices" with the provision they can still take it out X times a year.  sellers gets it off there books but can still enjoy it a few more times - is an easier mental transition too.

yeah, there are plenty of eBay gun-equivalents out there... as well as consignment websites, etc.

[PDXTabs]

I don't invest in collectibles, but I did play MTG in the 1990s. I would compare collectibles with private stock investments with no single exchange where you can check pricing.

And the underlying asset has no intrinsic earnings.  With stocks, either individual stocks or the broader market, you should be able to come up with some reasonable estimate of future price based on future earnings.  With collectables, the future price is based solely on the number and enthusiasm of people who want to own that collectable in the future.

That is true, except to the extent that MTG cards let you play in MTG tournaments (where you can earn money). Also, in 1959 a Remington Model 70 had an starting MSRP of $129.95. They have more than kept up with inflation (at least if you kept it in the box and didn't use it - more so if it is a rare model), but do not match the SP-500 with dividends reinvested. Which is why I don't invest in illiquid hard to store items. A rifle has some intrinsic value, but it is hard to argue that a 60 year old rifle is better than a rifle that you can buy today.

[Telecaster]

My guess would be that the gun collecting market will follow the 50s/60s muscle car market, but trail by about a decade. One thing gun collecting has going for it is that it doesn't take up a huge amount of space so boomers can take their guns with them as they downsize to a smaller retirement house. A collection of cars will be harder to fit in a 2 bedroom bungalow.

Electric guitars and accessories too.  Certain "vintage" stuff, which means manufactured before about 1980, goes for insane amounts.  For example, there is a distortion pedal called a Tubescreamer.   A used 1979 Tubescreamer in decent condition goes for about $1000.   A brand new Tubescreamer goes for about $120.   Sonically there is no difference, although some people claim otherwise.  Thing is, after the Boomers and GenX'ers die off, no one is going know or care what distortion pedal that Stevie Ray Vaughn used. 

[blue_green_sparks]

My guess would be that the gun collecting market will follow the 50s/60s muscle car market, but trail by about a decade. One thing gun collecting has going for it is that it doesn't take up a huge amount of space so boomers can take their guns with them as they downsize to a smaller retirement house. A collection of cars will be harder to fit in a 2 bedroom bungalow.

Electric guitars and accessories too.  Certain "vintage" stuff, which means manufactured before about 1980, goes for insane amounts.  For example, there is a distortion pedal called a Tubescreamer.   A used 1979 Tubescreamer in decent condition goes for about $1000.   A brand new Tubescreamer goes for about $120.   Sonically there is no difference, although some people claim otherwise.  Thing is, after the Boomers and GenX'ers die off, no one is going know or care what distortion pedal that Stevie Ray Vaughn used.

I bought a pair of 1976 special edition Bicentennial Gibson Thunderbird bass guitars as investments about 12 years ago. I believe they have tripled in value, but the problem is..I don't wanna sell, LOL.

[Captain Cactus]

Not exactly the same, but I always liked the idea of collecting a pirate’s chest of fine jewelry.  Some call that a jewelry box, I suppose. 

[YttriumNitrate]

Which is why I don't invest in illiquid hard to store items. A rifle has some intrinsic value, but it is hard to argue that a 60 year old rifle is better than a rifle that you can buy today.

Firearms are an interesting case for collecting in that legislation can make a huge difference in the price. A transferable 60 year old AR-15 is worth a heck of lot more than a new one you can buy today thanks to the 1986 NFA. A permanent repeat of the 1994 AWB could be a huge boon to people with large collections (although the market is largely saturated so it would take a while for the effects to be seen).

[Fishindude]

Firearms are an interesting case for collecting in that legislation can make a huge difference in the price. A transferable 60 year old AR-15 is worth a heck of lot more than a new one you can buy today thanks to the 1986 NFA. A permanent repeat of the 1994 AWB could be a huge boon to people with large collections (although the market is largely saturated so it would take a while for the effects to be seen).

Yea, every time some nut goes on a shooting spree and they start talking new gun laws, the stores quickly sell all inventory of guns and ammo and prices shoot up overnight.
I've got a couple older Colt AR's probably paid $7-900 apiece for.   A while back when things got goofy, probably could have sold them for $2k or more.   Things have normalized now and AR's are readily available and cheap.

[Car Jack]

My dad did some collecting and built some collections to give to my kids.  Here's some advice if you are building collections that you think your kids or their kids will consider as good, valuable and fun as you do.  They likely won't.

First collection were Franklin Mint type model cars.  I think they're like 1/16th size or something.  Very accurate and well built.  Here's the problem.  Each generation has cars they really admire.  Next generation.....lame.  So the post war American sedans and coupes and convertibles from the late 40's to early 50's are what my dad was interested in.  Me..late 60's muscle cars I used to see the trade school kids driving when I was in high school.  My kids...Japanese drift cars.  So those collectible cars are either still in boxes or the ones I let the kids play with have wheels and anything attached now broken off.  I haven't a clue what to do with the boxes of cars.  Perhaps eBay.

There's a couple collections that have "actual" value.  These are complete presidential coin dollar sets plus rolls of dollars along with holders and cases.  My older son took some of his to a coin shop who told him to spend them as they're worth no more than face value.  So he broke open the plastic cases and spent them on gas and soda and who knows what else, probably getting reactions down at the 7-11 from a counter person who never saw an uncirculated presidential coin before.  I ended up pulling back those he didn't spend and put them and the other son's coins in my safe.  I do plan to go to the local coin shop and see if they're worth more than a dollar each.  If they are, I'll likely sell them and distribute the cash to my kids.  If they aren't, then I'll probably just give my kids the coins.  In any case, nobody in my family has any desire to collect coins.  I had a small collection before college.  Heck, in my first job at Burger Chef, silver coins would show up daily in the cash register and at my next job at the bike shop, some kid came in with a bunch of silver coins and was willing to take face value in dollar bills.  In any case, during college, I'd bring maybe $5 face at a time to the coin shop and collect the $15 for what they were worth at that time. 

My dad also for a time ran a small antique shop in the storefront window of his insurance agency.  His building had a 1st floor office and 2nd floor apartment and he went to antique auctions picking up better stuff for the apartment and taking the old thing and selling it off.  When he passed, I got some of the stuff.  Like an 1800's set of kids sleds.  Well, I only know eBay and craigslist to sell stuff like this.  I stuck with craigslist and although he had a tag on each saying they were worth $300 each, the best I could do was $10 for both, including delivery.  So there's a lesson not to leave valuable things to your kids thinking they're actually valuable unless you tell them exactly how and where to sell them.  Heck, if he told me "bring these to Bob Jones in town and he'll auction them and get you hundreds of dollars", I would have visited Bob Jones with them.

You also never know what's going to be valuable in the future.  My older son couldn't find a job one summer during college.  So while waiting for replies from the hundreds of applications sent, he started going through Legos.  He sold on eBay and made thousands of dollars selling of stuff that's been in a bin for years.  On the other hand....those expensive wooden Brio train sets?  Essentially worthless.  I put up about $400 retail worth for sale for $5 and didn't have a single offer.  Into my wood furnace they went.

[onecoolcat]

What is interesting about my generation (mid-30s) is that a lot of things, not all, that were collectible when we were kids are still very much collectible today.  Examples of this are sports cards, comic books, pokemon cards, and magic the gathering cards.  I really wish POGs would take off again!  Man those were the days!  If you invest in something you enjoy then I don't think its "dumb".  If you get into sport cards investing because you think you'll turn a profit doing it then that is dumb.

[Wolfpack Mustachian]

My dad did some collecting and built some collections to give to my kids.  Here's some advice if you are building collections that you think your kids or their kids will consider as good, valuable and fun as you do.  They likely won't.

First collection were Franklin Mint type model cars.  I think they're like 1/16th size or something.  Very accurate and well built.  Here's the problem.  Each generation has cars they really admire.  Next generation.....lame.  So the post war American sedans and coupes and convertibles from the late 40's to early 50's are what my dad was interested in.  Me..late 60's muscle cars I used to see the trade school kids driving when I was in high school.  My kids...Japanese drift cars.  So those collectible cars are either still in boxes or the ones I let the kids play with have wheels and anything attached now broken off.  I haven't a clue what to do with the boxes of cars.  Perhaps eBay.

There's a couple collections that have "actual" value.  These are complete presidential coin dollar sets plus rolls of dollars along with holders and cases.  My older son took some of his to a coin shop who told him to spend them as they're worth no more than face value.  So he broke open the plastic cases and spent them on gas and soda and who knows what else, probably getting reactions down at the 7-11 from a counter person who never saw an uncirculated presidential coin before.  I ended up pulling back those he didn't spend and put them and the other son's coins in my safe.  I do plan to go to the local coin shop and see if they're worth more than a dollar each.  If they are, I'll likely sell them and distribute the cash to my kids.  If they aren't, then I'll probably just give my kids the coins.  In any case, nobody in my family has any desire to collect coins.  I had a small collection before college.  Heck, in my first job at Burger Chef, silver coins would show up daily in the cash register and at my next job at the bike shop, some kid came in with a bunch of silver coins and was willing to take face value in dollar bills.  In any case, during college, I'd bring maybe $5 face at a time to the coin shop and collect the $15 for what they were worth at that time. 

My dad also for a time ran a small antique shop in the storefront window of his insurance agency.  His building had a 1st floor office and 2nd floor apartment and he went to antique auctions picking up better stuff for the apartment and taking the old thing and selling it off.  When he passed, I got some of the stuff.  Like an 1800's set of kids sleds.  Well, I only know eBay and craigslist to sell stuff like this.  I stuck with craigslist and although he had a tag on each saying they were worth $300 each, the best I could do was $10 for both, including delivery.  So there's a lesson not to leave valuable things to your kids thinking they're actually valuable unless you tell them exactly how and where to sell them.  Heck, if he told me "bring these to Bob Jones in town and he'll auction them and get you hundreds of dollars", I would have visited Bob Jones with them.

You also never know what's going to be valuable in the future.  My older son couldn't find a job one summer during college.  So while waiting for replies from the hundreds of applications sent, he started going through Legos.  He sold on eBay and made thousands of dollars selling of stuff that's been in a bin for years.  On the other hand....those expensive wooden Brio train sets?  Essentially worthless.  I put up about $400 retail worth for sale for $5 and didn't have a single offer.  Into my wood furnace they went.

I think this is a great point. If you're "investing" in collectibles/coins/whatever to give to your kids, you'd probably be much better off putting the money in the market or I-bonds for them to use for college or whatever. I know I personally have $12.50 worth of 50 state quarters coming to me sometime in my future :-).