Comic Book Investing

[revat]

I think we're edging precariously close to 'politics'

[COI]

This idea that "corporations are evil", and "the worker is exploited and needs to be saved from evil management that steals food from the mouths of their children" is nothing but Marxist poison, convincing people they are not masters of their own individual destinies, but rather victims, with no choice but to become slaves to a system that chews them up and spits them out.

 

I agree with all of your post, save this point. That might be true in America, it's not true in developing countries. Yes, yes, I know that female workers are better off making 10 cents a shirt in some sweatshop than selling themselves on the street, and that same sweatshop is preferable to subsistence farming in a hut without electricity or running water, but those realities and the reality that workers are badly exploited by corporations aren't mutually exclusive. Workers might be marginally better off, but corporations still take advantage of the fact these people and the countries they live in have nothing to offer other than their cheap labor. The use that fact to keep products at a low price point to pad their bottom line. The people actually producing the items we consume receive an unbelievably low percentage of the final sales price and lead lives we can hardly image (thankfully).

 

+1. And it's not even true in America.

 

I love you RMA, but that position is horribly simplistic.

 

No, it's philosophic. That's the GOAL, it's the point, even if not (always) the practice.

 

If workers didn't think of themselves as victims with no options, only to be exploited by those providing employment, but rather as a person with a valuable skill set which they can, and should, market to whomever is willing to pay the most for those services, they would personally do themselves a great service.

 

In other words, if they thought of THEMSELVES as entrepreneurs, selling their abilities and services to those who are willing to pay the best price for them, the worker/management dynamic would be, and is, much improved.

 

I get where you're coming from.

 

I did my master's thesis on this very topic, so I don't want to derail this thread with stuff no one wants to read. This is an extremely complicated topic that can't be done justice here.

[RockMyAmadeus]

Geez, guys, it's not that complicated.

Cherry picking illustrations in hindsight (20/20) is probably the worst way to make any argument about future investments (sadly, it's very popular in the investing world, though). Instead of saying what about the 'average' comic investor who bought walking dead 1, 10 years ago, or as an analogy to stocks, what about the 'average' investor who bought AAPL 10 years ago , it makes far more sense to point out to some type of index or basket of investments as a reference... the longer, preferably, the better. This is a better proxy for what any 'average' investor bought.

 

(thumbs u

 

That's why I started the list off showing the 5-year return of the S&P 500 (+136%; incidentally, the Nasdaq QQQ ETF returned 172% and the Russell 2000 ETF returned 150%), which is about as representative of an "average" stock market investment you can get, and then listed a lot of large-cap, household name companies. If I wanted to, I could have easily cherry picked a bunch of quadruple-digit 5-year winners that would be the equivalent of picking Atlas horror comics, but these are things that hardly any investors would have known about or considered 5 years ago.

 

Saying that the average collector would have had any idea to buy the stuff that Richard listed 5 years ago is a wild stretch, to say the least. That list certainly does not show that the average collector who buys things that the average collector likes would have fared really well compared to what they could have made elsewhere. And therein lies a major flaw with investing in comics - buying what you like often does not lead to the best investment opportunities, and emotional/nostalgic attachments can also lead you to overpaying on entry and/or holding on too long (among numerous other pitfalls).

 

But, hey, knock yourselves out - I'm just having a polite conversation here, not trying to sell anybody anything or talking my book.

 

The "average" collector wasn't buying Atlas horror or early Archies, but they weren't buying lone top census bronze, $2000 9.6 ASM 122s, #1 copper registry sets, $10,000 a pop Church More Funs and Adventures either....so not sure how you can object to Richard's list without invalidating your own.

 

You want to know what an "average" collector buys when they want to drop some money, invest, whatever, on a comic? They buy mid-grade Hulk 181s. They buy nice raw copies of ASM 300. They buy fine range ASM 121s, 122s and 129s. They buy Cap 100s and Iron Man 1s in VG/F. They buy Batman 227s and 232s. Or, if they have a bit more discretionary income, they buy low/mid grade copies of JiM 83, TOS 39, Avengers 1 and 4, etc. How do you think those purchases have fared over the last decade? Far from going down, they steadily increase year in and year out.

 

I know this because I have set up at enough shows and sold enough stuff to dealers to know what the mid-level collector always wants. Year after year, the same stuff that's hard to keep in stock. They don't want 9.6/9.8 keys priced at $2,000-$10,000. That's a niche market. Not the norm. Extrapolating market trends (as you continue to do) from the extreme high end isn't valid. The extreme high end bronze and silver books have suffered. You are right on that. That's also a tiny, tiny, tiny fraction of the comic market that most collectors don't understand, spend their money on, or generally give a damn about.

 

I agree with your contentions, but I think you're equating the average collector with the average investor, but there is a difference.

 

The mantra for the investor in collectibles has always been "buy the very best that you can afford", which is at odds with the collector, who buys as much as he can get for his money.

 

In that sense, these extreme high ends are where investors would have been consistently advised to go. "Buy quality, not quantity."

[COI]

This idea that "corporations are evil", and "the worker is exploited and needs to be saved from evil management that steals food from the mouths of their children" is nothing but Marxist poison, convincing people they are not masters of their own individual destinies, but rather victims, with no choice but to become slaves to a system that chews them up and spits them out.

 

I agree with all of your post, save this point. That might be true in America, it's not true in developing countries. Yes, yes, I know that female workers are better off making 10 cents a shirt in some sweatshop than selling themselves on the street, and that same sweatshop is preferable to subsistence farming in a hut without electricity or running water, but those realities and the reality that workers are badly exploited by corporations aren't mutually exclusive. Workers might be marginally better off, but corporations still take advantage of the fact these people and the countries they live in have nothing to offer other than their cheap labor. The use that fact to keep products at a low price point to pad their bottom line. The people actually producing the items we consume receive an unbelievably low percentage of the final sales price and lead lives we can hardly image (thankfully).

 

There are, sadly, always exceptions. Unfortunately, the people in charge of those nations do nothing to protect their own people from this exploitation. It's not capitalism when all parties don't have the freedom to pursue their own interests, and that is unfortunately true in most of the non-Western world, and even parts of the Western world, too.

 

 

That said, there is MUCH to be said about being an informed consumer, and NOT supporting the companies that behave in ways contrary to one's own ethics. It may cost more, but is it not worth it, knowing you don't support practices which you do not agree?

 

The way corporations operate in America isn't entirely capitalism either.

 

It was fun, in a stomach churning depression inducing way, to see so many dyed-in-the-wool capitalists demand a trillion dollar cash infusion to keep their corrupt and failed financial enterprises afloat. What's it called again when a government takes a strong and vested interest in the "free" market?

 

Capitalism for the poor, capitalism for the rich when it works. The other thing when it doesn't.

 

Yeah, the "other thing" when it doesn't...but only for the rich. Capitalism for the poor whether it works for them or not. Bootstraps and all that.

 

I'll leave it there.

[namisgr]

Anywhoo, I hope all of you comic 'investors' have also invested some of your net worth in the US stock market, which has been on a raging 5 year bull (whilst gold has tanked) and today is once again flirting with all-time highs in the averages.

[ComicConnoisseur]

You mean all those Charizard holofoil cards we bought for my son aren't the solution for putting him through college?

Believe it or not Pokémon shouldn`t be counted out like POGS.

I had an experience a month back.

My 25 year old nephew who has a Masters had just gotten married, and after the wedding as I was sitting with a bunch of 20 something year olds at the wedding reception. I found all the talk was about how back in the day they all collected Pokémon, and how they are all nostalgic for it.

Mind you now these were people in their mid-twenties who have just gotten their law degrees,Masters in Psychology and MBAs. These people are the ones who will have the disposable income to buy those Pokémon keys. So yeah expect some of the Pokémon stuff to have value.

 

Have you learned nothing from all those articles I posted about the fallacy of the 'rule of 25?'

 

As I said before it is not all pop culture products, but the best of the best.

1960s= Marvel, Beatles, James Bond.

1970s= Star Wars, Kiss, Apple products.

1980s =Transformers,TMNT.

The best of the best always rises to the top.

I stated before that not all rule of 25 products turn out as good investments, but you can make money if you zero in on the holy grails of pop culture from different eras.

So I suggest that you look into buying those Mighty Morphin Power Rangers, and Harry Potter Holy grails now while you have a chance.

One day that first print Harry Potter book might be worth a fortune.

 

 

 

[RockMyAmadeus]

 

It was fun, in a stomach churning depression inducing way, to see so many dyed-in-the-wool capitalists demand a trillion dollar cash infusion to keep their corrupt and failed financial enterprises afloat. What's it called again when a government takes a strong and vested interest in the "free" market?

 

Capitalism for the poor, capitalism for the rich when it works. The other thing when it doesn't.

 

Those people aren't capitalists. They are anything but. It was, and remains, a sickening transfer of power from the people to the aristocratic.

 

[RockMyAmadeus]

One more aside: we can have these discussions, and I think they're great, without taking potshots at, and making character judgments on, others.

 

N'est-ce-pas...?

 

We are touching on some very basic, and very fundamental (dept. of redundancy dept.) concepts, here, which aren't easily boiled down, but are necessary for people to understand.

 

Muddying that up with personal commentary is useless.

[Sqeggs]

they want to be told that buying a low-grade Cap 1 or a mid-grade AF 15 or a mid-grade IH 181 instead of fully funding their 401Ks or IRAs is a good idea.

 

Investing money in comics with the hope of funding your kids' college tuition or your retirement is a really bad idea.

 

Are we reading the same thread? I haven't heard a single person in this thread advocating buying comics instead of funding their retirement or college funds.

 

Of course they are. They may be bashful to admit it, but it seems pretty clear they are advocating buying comics as an investment rather than fully funding their retirement accounts with conventional financial investments.

 

They seem to feel they are funding their retirement or college funds ... but with comics.

[Cat-Man_America]

This was the post I typed up last night at 3AM, but decided not to post until there was more of a response:

 

In essence, stock speculators become silent partners to a system that works tirelessly to defeat the aspirations of those employed by those companies to whom they claim partial ownership of assets. The stock investor essentially profits off the labors of others, one of many invisible faces seeking dividends while executive boards downsize jobs, cut benefits, move businesses overseas and take food from children's mouths.

 

Oh my.

 

It is because we have corporations that most Americans have jobs. It is because we have corporations that we enjoy the tremendously high standard of living that we do.

 

The beauty of capitalism is simple: it provides the most people with the most opportunity, and raises the standard of living for everyone.

 

If you want to work hard, fail, try hard, fail some more, think hard, and maybe eventually succeed...there is no better system devised by man that allows for this than capitalism.

 

Have you ever owned a business, David, and had employees...? If so, are you trying to defeat your employer's aspirations, hoping to mercilessly exploit them until they drop dead, only to be replaced by more drones?

 

Or, are you invested in your employees, knowing that their success means your success, their happiness means your success, their growth means your success, their experience means your success...?

 

Only fools treat their employees like chattel. Those companies INVARIABLY fail. Yes, of course they may succeed for a while...but they will always, eventually, see their demise.

 

Do you not realize that it is the entrepreneur who takes all the risk, while the employee takes none? So, what do you do, as a human being? Do you choose the safety and security of being an employee, never having to worry about the risk involved in owning your own business, never having to worry about payroll, never having to worry about benefits, never having to worry about so many things that "the bosses" have to worry about, allowing them to "profit from your labor" because you know it provides a level of security you could not enjoy on your own?

 

Or....do you strike out on your own, hoping to own the means of production yourself, but assuming risk that could wipe out everything you own?

 

And the stock investor, profiting off the labor of others? How many employees have been forced to work for nothing, because the company's earnings were down?

 

None, of course. It's against the law. We call it slavery. The only thing an employee really needs to worry about is making sure the company maintains the ability to keep him employed, and he does that by being a valuable employee.

 

How many stock investors, however, have lost everything....essentially working for nothing...when companies they invested in failed...?

 

Answer: lots and lots and lots.

 

Being an employee carries essentially no risk. You are guaranteed a pre-negotiated payment for your services, on a regular basis. The only thing you have to worry about is making sure you hold up your end of that bargain. And, on the off-chance that an employer CANNOT pay you, you will find that out soon enough, and can move on to somewhere else, without having spent too much time working for "free" (and are usually then covered by unemployment insurance.) Being an employee usually means that you can go home at the end of your shift and never have to think about your job until your next shift.

 

Those are just a few of the benefits of being an employee...there are many more.

 

Being an owner carries tremendous risk. You are guaranteed nothing by anyone. You worry constantly. You are rarely free to not think about your venture. You have to provide, not just for yourself, but for YOUR employees, and making sure they are happy, healthy, and don't have cause to leave for your competition.

 

Being an investor also carries risk. You are guaranteed no return on your investment. You could lose everything you invest.

 

There are benefits and disadvantages to both sides of the equation. It works best when EVERYONE is free to pursue their own interests, free of coercion by his fellow man. This idea that "corporations are evil", and "the worker is exploited and needs to be saved from evil management that steals food from the mouths of their children" is nothing but Marxist poison, convincing people they are not masters of their own individual destinies, but rather victims, with no choice but to become slaves to a system that chews them up and spits them out.

 

Entrepreneurs need employees. Employees need entrepreneurs. They both need each other. It is a symbiosis. And the beauty is: you can be one or the other, or even both.

 

 

(It may be a tad rough, but that's essentially the point.)

 

Tough is fine, but in fairness you know little about my life inside and outside the private sector. I've seen all sides of this and know of what I speak. Let's just leave it at that.

 

I'm not denouncing corporations ad hoc, nor am I critical of all stock investment.

 

While the line about taking food from children's mouths was intended as hyperbole for the sake of making a finer point, there is plenty of evidence to bear out the historic impersonality of business in dealing with labor. That was not the point of making this analogy, however. We were discussing the pros and cons of stock speculation in comparison to comic collecting for investment.

 

The ownership of intangible stocks isn't being singled out as a bad actor here, but there's little doubt that high achieving stocks often do so through finding cheaper means to increase profitability and satisfy shareholders. I would also argue that barriers that conceal stockholder's identities are there to protect them from personal embarrassment when they profit from controversial corporate decisions.

 

You make some very salient points about business ownership and investing. I would even concur with an investment strategy that includes diversification as part of one's portfolio for the long term security of one's assets.

 

As far as your Marxist poison comment, maybe we should extend Godwin's Law to cover use of controversial buzz words that evoke un-American images. IOW, those who go to this length to win debate points have already lost the argument.

[adamstrange]

As some of you know, I'm a big original art collector.

Translation: "Don't you know who I am?"

Correction: You are an original art collector who thinks of himself as big, maybe physically, certainly intellectually. There is a difference.

 

I do really enjoy looking at that little accumulation of art you have there though. Great stuff. Thanks for sharing (thumbs u

 

Translation: I'm big into original art. Figure of speech. Not that I need to be forgiven for engaging in a little chest-puffing when there are noobs here telling me to take a hike.

If you ever get big into original art selling there are a few I hope you would give me a call about.

 

I'll mark its value down by as much as 2/3rds

 

[RockMyAmadeus]

As far as your Marxist poison comment, maybe we should extend Godwin's Law to cover use of controversial buzz words that evoke un-American images. IOW, those who go to this length to win debate points have already lost the argument.

 

I neither know about, nor was commenting on, anything you have done in your private life.

 

As for the above...you would be correct, if that was the only point I was capable of making.

 

Clearly, it's not.

 

And I have no interest in "winning" anything. This is an exchange of ideas, for which I thrive, not a contest.

[Sqeggs]

Where was the edge five years ago when all of that was true? Ten years ago when all of that was true? Spidey has been popular since the late 60s and they have been making blockbusters based on him since 2002. By your logic AF 15 should have peaked in the mid 2000s with no new value drivers upping the price. That hasn't been the case.

 

There have been value drivers since the mid-2000s, though - a cheap money-fueled general asset bubble, more superhero movies (both Spidey and non-Spidey) which have whipped fanboys into a lathered frenzy, etc. That's also not to say that prices can't just go up on momentum and past performance alone (for a while, anyway), but mean reversion and market reality eventually kick in.

 

Maybe. The top collectibles in any field seem to keep gaining value almost indefinitely, even when the rest of the hobby is dying. If the best stamps can continue to see record gains, I don't think a copy of one of the top books in an unarguably much healthier hobby is going to see a major correction anytime soon. Do I think $10,000 for a VG range copy is sustainable in the long (3-4 decade) term? Nope. Do I think the runup will continue for years to come? Yep.

 

This same point keeps getting repeated. AF 15, or whatever, doesn't have to suffer a "major correction" to be a lousy investment. It's a lousy investment if it doesn't have a substantial increase in price from here.

 

Think of it this way: According to GPA, the 12-mo average for a 7.0 AF 15 is $36,500 (down from $41,500 in 2012, btw). The long run average real return on the U.S. stock market is 9%. To even increase at half that rate, the price of a 7.0 AF 15 would to have to rise in 20 years to $88,000 (in 2014 dollars).

 

What are the sources of increased demand that would result in such an increase? And remember, even that increase would only be half the long-return on stocks.

 

 

[Underground44]

Shouldn't this garbage be in the water cooler.

[RockMyAmadeus]

By the way...even the venerable AF #15 has suffered periods of correction...twice...once in the early 80's, and once again from 1998-2000 or so.

 

Those who bought at market price in 1981, but were forced to sell by 1985, lost a considerable portion of their investment.

 

"Four years isn't that much, RMA!"

 

But many of the comments here have been speaking of investing for periods as little as a year.

[october]

I am officially sick of talking about AF 15.

[RockMyAmadeus]

[HighStakesComics]

Where was the edge five years ago when all of that was true? Ten years ago when all of that was true? Spidey has been popular since the late 60s and they have been making blockbusters based on him since 2002. By your logic AF 15 should have peaked in the mid 2000s with no new value drivers upping the price. That hasn't been the case.

 

There have been value drivers since the mid-2000s, though - a cheap money-fueled general asset bubble, more superhero movies (both Spidey and non-Spidey) which have whipped fanboys into a lathered frenzy, etc. That's also not to say that prices can't just go up on momentum and past performance alone (for a while, anyway), but mean reversion and market reality eventually kick in.

 

Maybe. The top collectibles in any field seem to keep gaining value almost indefinitely, even when the rest of the hobby is dying. If the best stamps can continue to see record gains, I don't think a copy of one of the top books in an unarguably much healthier hobby is going to see a major correction anytime soon. Do I think $10,000 for a VG range copy is sustainable in the long (3-4 decade) term? Nope. Do I think the runup will continue for years to come? Yep.

 

This same point keeps getting repeated. AF 15, or whatever, doesn't have to suffer a "major correction" to be a lousy investment. It's a lousy investment if it doesn't have a substantial increase in price from here.

 

Think of it this way: According to GPA, the 12-mo average for a 7.0 AF 15 is $36,500 (down from $41,500 in 2012, btw). The long run average real return on the U.S. stock market is 9%. To even increase at half that rate, the price of a 7.0 AF 15 would to have to rise in 20 years to $88,000 (in 2014 dollars).

 

What are the sources of increased demand that would result in such an increase? And remember, even that increase would only be half the long-return on stocks.

 

 

Aside from cookie cutter Vanguard Index Fund answer, Id be curious to hear what ideas you have where you expect to earn 9% future ROI in the stock market. Many of us have provided specific examples, in both stocks and comics, where we feel future appreciation is the most likely outcome. I would like to hear your own words, versus putting them in the mouths of others.

[Jaydogrules]

Where was the edge five years ago when all of that was true? Ten years ago when all of that was true? Spidey has been popular since the late 60s and they have been making blockbusters based on him since 2002. By your logic AF 15 should have peaked in the mid 2000s with no new value drivers upping the price. That hasn't been the case.

 

There have been value drivers since the mid-2000s, though - a cheap money-fueled general asset bubble, more superhero movies (both Spidey and non-Spidey) which have whipped fanboys into a lathered frenzy, etc. That's also not to say that prices can't just go up on momentum and past performance alone (for a while, anyway), but mean reversion and market reality eventually kick in.

 

Maybe. The top collectibles in any field seem to keep gaining value almost indefinitely, even when the rest of the hobby is dying. If the best stamps can continue to see record gains, I don't think a copy of one of the top books in an unarguably much healthier hobby is going to see a major correction anytime soon. Do I think $10,000 for a VG range copy is sustainable in the long (3-4 decade) term? Nope. Do I think the runup will continue for years to come? Yep.

 

This same point keeps getting repeated. AF 15, or whatever, doesn't have to suffer a "major correction" to be a lousy investment. It's a lousy investment if it doesn't have a substantial increase in price from here.

 

Think of it this way: According to GPA, the 12-mo average for a 7.0 AF 15 is $36,500 (down from $41,500 in 2012, btw). The long run average real return on the U.S. stock market is 9%. To even increase at half that rate, the price of a 7.0 AF 15 would to have to rise in 20 years to $88,000 (in 2014 dollars).

 

What are the sources of increased demand that would result in such an increase? And remember, even that increase would only be half the long-return on stocks.

 

 

I don't know any dealers that have any 7.0 AF 15's available for $36k. Take the trailing indicating (and grossly incomplete) data on GPA with a grain of salt.

 

-J.

[COI]

The millennials won't care about any of this junk, and if even if they did, they won't have the money.