Comic Book Investing

the blob · June 28, 2014

You have inadvertently answered your own question. Very few people, no matter what they invested in. Will retire with several million dollars "in the bank". ESPECIALLY middle class working stiffs that saved 10% of every pay check.

In order for you to retire with several million dollars in accounts, I seriously doubt that you were/are a middle class working stiff.

Does not compute. Especially if you have 140 boxes of comic books. Unless they are rag readers.

I ain't doubting what you say. But I am saying that I did the same thing for my entire career. With the 10% going into a "deferred compensation" program. And I don't have anywhere near several million dollars "in the bank". So, I don't understand the middle class part. There were a couple of times that the stock market took huge sudden loses and so did my account. So did everyone's accounts.

The so-called experts, and everyone else.

----------------------

like many other 40somethings my 401K has been blasted twice in the last 15 years. it's depressing. yes, if i had timed the peak, went to cash and jumped back in at the bottom on both of them I guess I would be well on my way, but I didn't and few others did. true, i have not contributed since mid-2004 so i avoided buying in the 2004-2007 run-up, but i guess i missed buying into the last run-up. i can't figure out my true rate of return, but i suspect it ain't 6% and i was basically in S&P 500 and Russel 2000 broad index investments, playing it pretty conservative

Jaydogrules · June 28, 2014

While all of this may be true (and neither you, nor anyone else needs to justify their lifestyle choices to anyone on these boards), $150-200k is still not remotely a "middle class" income. Period.

-J.

the blob · June 28, 2014

i agree, but in these locations it is the bottom end of upper middle class. remember, it is also often a result of two incomes. if the household makes that much and one spouse can stay home (and thus avoid childcare expenses), yes, you are going to live more "upper middle class" but you would be surprised at just how few "upper middle class" perks one has at that income when both parents are working, 2+ kids, childcare expenses, etc. (I, for example, have a todfler and another under 9, neither one of us come home before 7:30 from work...). i am not crying poverty, although i am broke most of the time, it's just not high on the hog living that some people may assume because i agree, $150-$200K is frigging loaded in des moines or wherever.

HighStakesComics · June 28, 2014

So anyone know of any hot books for the 2nd half of 2014? Anything I should be buying?

passion4comics · June 28, 2014

Stocks? I bought into stocks that went from $18 a share up to around $130 (buying in the entire time) then they were found cooking to books; 14,000 shares into vapor. I bought and sold during this time too, so the IRS made a ton of money! I had blue chip stocks which at least covered part of my portfolio, but they took a beating too. Sarbanes-Oxley was supposed to fix that. I had other shares in various stocks after the mess in the late 90’s. Since I was in the financial industry at the time I had BOA, Citi, Merrill, etc while trying to rebuild my retirement and personal portfolio; let’s stick with the time tested companies. Then came 2008. After that, the stock market can blow itself. Putting 10% into a 401k and then eating rice and beans for years to put another 10-15% just to see it turn into lost electrons was not the way to invest. Are stocks a good investment when you can’t even trust a company to keep proper records and not take insane risks to make numbers? 10 years of working down the tubes. I could have been living under a bridge with bums and in the end broke even.

Real Estate. I live in a house that’s worth 1/3rd what it was worth in 2007. Since everyone else around me walked away from their mortgages and there was a block of time where the county and school system was about to collapse, they upped everyone’s taxes except when the houses were finally bank sold, they never reduced them. Now I’m paying nearly 10k in school taxes where in 2005 I was paying $2200. Is Real Estate a good investment?

Then we can look at gold. A lot of people bought in while it was over 1k-1600 and now it’s around $1300 an ounce. I bought in at around $1000 and kept buying in until the government was about to shut down and thought almost 2k was too expensive and just put everything on pause. Gold will probably go back down to around 1k again and that leaves me where? With a bunch of Eagles worth the same amount I paid going back years and years.

Divorce… Anyone that has went through that knows that you usually start back at zero or in the negatives. That was a fun 2009. Then I was remarried in 2010 (she wasn’t the mistress, I met her in a mall trying to find this new elusive perfume for my mother on Christmas).

This is what I’ve learned. It’s pure luck. Some guys will put money into their 401k and do fine. For the rest of us, life screws us, things happen, bumps, sickness, disasters, and now kids which are little money pits that leave fingerprints everywhere. I have yet to find anything that is a solid investment and if I’m going to lose everything again, at least I have my funny books that I can enjoy rather than a Charles Schwab account waiting for the next CEO to nuke his own company and get a bonus for his crimes.

Someone tell me where the good investments are?

ComicConnoisseur · June 28, 2014

That`s what I think he was trying to get at. A good number of Americans are rich on paper because of their houses worth, but in fact they are living paycheck to paycheck.

An example is my cousin owns or is paying a bank the next 30 years to pay off a house that has a perceived value of 1 million. On paper my cousin can say they are worth one million because of that house`s perceived value, but in reality they are not, as they struggle just to make the bank mortgage payments, pay car loans, come up with gas money, and what not.

Why you get so many Americans think they are richer then what they really are is because of their perceived house`s value.

HighStakesComics · June 28, 2014

Yeah, but that is one sexy copy of Showcase #4 you've got, my man and no one can take that away from ya. Please don't beat yourself up. We've lived through trying times, and if you've got that nice of a comic, a roof over your head, and the love of a good woman you are doing something right.

As far as stocks go, for the record had the gentleman from yesterday accepted my challenge I would have gone with USB. Very strong balance sheet, solid footprint, and a yield close to the 10 year. More often than not, slow and steady wins the race.

delekkerste · June 28, 2014

Frankly, it doesn't sound like you had a very diversified stock portfolio - 14,000 shares @ $130/share = $1.82 million. Unless you had an 8-figure stock portfolio (maybe multiple 8-figures), of which this was just a small portion, it sounds like you were very undiversified. Then you put a lot of money into 3 stocks (Citi, Merrill, Bank of America) in the same industry (one with very questionable fundamentals by the mid-2000s) which ends up getting hit by a once in a lifetime storm in 2008, at which point you give up on the stock market right at the generational lows. Not to be too harsh, but that sounds like a combination of bad luck and bad analysis/financial planning. People who were diversified and maintained a consistent long-term investing plan fared much better.

I took a big hit in 2008 myself. And then two hedge funds I was invested in blew up on me in 2011-2012. Between these two events, I took some pretty sickening losses. And, yet, I'm still hugely ahead of where I would have been had I thrown in the towel at the lows of 2008-9, because I've stayed committed to a long-term, diversified investment plan and have made the most of the opportunities the market has presented the past few years, even after being initially slow on the uptake regarding the post-2008 turnaround. As for real estate, if you use 2007 as a starting point, a lot of real estate doesn't look so good, true. But, if you use 2009-2012 as a starting point, the numbers look a lot different.

Whether we're talking about stocks, real estate, gold or even comics and other collectibles, people who bought low have done well; people who bought at/near the top have fared less well. But, at least with assets that generate underlying cash flows (whether earnings, rent, etc.), time tends to bail out poor decisions as long as you stay diversified and stick with a long-term investment program and not panic out at the lows. Yes, you might occasionally step on a fraud or bankruptcy landmine that permanently impairs your invested capital, but, if you're diversified, these are losses that can easily be made up over time. It's pretty amazing that the average retail investor actually lost money in the best performing mutual fund of the decade of the 2000s (the CGM Focus Fund) because it was a volatile fund and Joe Sixpack kept buying at the highs and selling at the lows instead of sticking with the program.

I disagree wholeheartedly that investment success is "pure luck". While there is certainly a random element that cannot be fully controlled, there are many things you can do to tip the odds in your favor (staying diversified, remaining committed to a long-term investment program, doing your homework and buying when you have a margin of safety, etc.) I'm sorry that your experience with stocks and real estate has not been a good one, though I think some of your woes could have been very avoidable. As for "where the good investments are", no one is going to tell you - it may not be as fun as doing comic-related things, but people need to put in the hours themselves to seek out and evaluate investment opportunities (or even just to learn how to do so).

FWIW, though, the "Gold price hits $500 thread" in the Water Cooler that I linked to has actually very little to do with the price of gold (it morphed into an all-purpose investment thread after debuting as a gold thread in 2005), which is only one of a number of topics discussed there (and anyone who has kept up with the thread knows that I am not bullish on gold and am certainly not a goldbug). We often talk about (non-comic) investments there and I think it's a pretty worthwhile read.

mysterio · June 28, 2014

Only the part you have paid off contributes to net worth. If you owe $500,000 and have $60,000 in equity that equates to a -$440,000 contribution to your net worth. That is not rich on paper or anywhere else.

Sqeggs · June 28, 2014

The long-run annual real rate of return in the U.S. stock market is 9%. Easily high enough to give you a comfortable retirement if you invest regularly and don't panic and sell in down markets. Common advice is to have a diversified portfolio -- very easy to do with index funds -- and, certainly, to avoid concentrating your stock purchases on companies in the same industry you are employed in.

I'm no financial guru but that approach has worked for me.

Jaydogrules · June 28, 2014

We are grossly off topic again, but no, this is not correct. If you have a $500,000 value house with a $440,000 mortgage, that $60,000 in equity is applied to your net worth. The caveat to this is, that the equity in your owner occupied property is not applied to your net worth in a financial analysis.

-J.

ComicConnoisseur · June 28, 2014

The point I was trying to make was he says he is a millionaire because his house value is worth a million, but in reality he is living paycheck to paycheck to pay off the mortgage to the bank.

Like he says on paper his house has a value of one million, but he himself doesn`t feel like a millionaire.

Now repeat that scenario for millions of Americans whose houses have high values, but they are just barely making it trying to pay the banks off.

It`s really an illusion of false wealth.

On paper millionaires do to their houses value, while on the other hand they are just getting by in the real world.

.

mysterio · June 28, 2014

Not to get any farther off topic, but how is that not correct? Net worth is assets minus liabilities. I completely agree that the $60,000 in equity goes on the asset side, but you can't ignore the remaining mortgage debt.

shadroch · June 28, 2014

I don't agree with much of Dave Ramsey's financial philosophy, but I admire his ability to reduce complex matters into one liners.

On the stock market, he says this-The only people that get hurt on a roller coaster ride are the ones who get off in the middle.

Superman2006 · June 28, 2014

In terms of the example above, assuming his house is his only asset:

Assets = House = $500K

Liabilities = Debt on House = $440K

Net Worth = Equity on his House = $500K - $440K = $60K

HighStakesComics · June 28, 2014

6% realtor fees would chop his net worth in half when he needs to liquidate. Only 2.5-3% PayPal fees if you sell books on the boards here, gang. Granted its higher on link, cc, ebay but there are alternatives. Sale of comics is also taxed in a similar manner to short term cap gains in the stock market (28%). If there is a compelling argument that vintage comics are not investments, I have yet to hear it.

Aweandlorder · June 28, 2014

Buying and selling comic books is not an investment its a job

Jaydogrules · June 28, 2014

Not quite-- Whatever equity is in your principal residence is not applied toward your net worth in a financial analysis.

-J.

Petey's Wheatcake · June 28, 2014

The books that get a bump from San Diego are usually a safer short term buy.

I like Shazam 28. Although if you have to make a profit by Jan 1, it might not be the best choice depending on whether or not Warner Bros confirms that potential slate of seven films in three years Nikki Finke reported on a couple of weeks ago. But if Dwayne Johnson plays Black Adam in a future Shazam film? I'm guessing that current raw prices double by August.

Longer term, I think it's a safe bet even if he's playing Captain Marvel and Black Adam isn't in the first movie. Either way, that's a villain that will be getting more exposure when the rising tide of the franchise lifts his boat.

Two potential thread derailers regarding my last point are:

1. DC will finally bring about the death of the comic book film with this ridiculous assault on the multiplexes by 2018. Throw the Marvel movies in there, and the X-Men, and the FF reboot, and comic book fatigue is guaranteed to set in, right?

I'm sure there is another thread where this has already been discussed in detail, so for now I'll just answer with - Nope, it isn't.

2. Black Adam first appeared in The Marvel Family 1, not Shazam 28.

Good point. Golden Age Captain Marvel comics are so very, very cheap. I plan on buying more of those too, but Shazam 28 is still going to be more valuable in the future than it is at this moment, and that's all the matters for the purposes of this discussion.

I'd also be surprised if there wasn't at least some Avengers footage shown there, and then the first trailer in Nov or Dec should guarantee a small increase in price before the end of the year. This is a very safe, boring choice, but the first Guardians appearances had risen in price steadily for more than a year before the first trailer hit and then still had room to jump a bit afterward. If you want low risk/smallish reward this will work.

I'm typing too much here but I'd also like to say that I stubbornly refuse to give up on the long term potential of Wonder Woman and Aquaman. Cardy produced some beautiful Aquaman covers. Eventually justice will prevail and people will pay good money for those.

HighStakesComics · June 28, 2014

Brilliant analysis. Thank you.

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Comic Book Investing

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