Comic Book Investing

[the blob]

If you bought Action #1 in 1938 for 10 cents and held it for a decade before selling, you'd have lost 50% of your investment. If you held it for 20 years before selling, you'd have still lost 50% of your investment.

 

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I was reading an interview in Alter Ego or something along those lines with some old timey artist and he recounted how he was desperately trying to hunt down either an Action 1 or Superman 1 (probably Superman 1 as by then Superman had built up some fans) at a news stand after it came out and the guy there was holding out and charged him 50 cents for it.

 

First example of comic dealer profiteering on a back issue?

[ComicConnoisseur]

I ask you in all fairness and respect if you really believe this? He is a dealer and for him comic books are his livelihood. As such of course he is going to say that comic books are a great investment. To the average enthusiast; I would beg to differ.

Hate to say it. But as soon as I read who this was coming from, that was the first thing that came to mind.

 

What I find absolutely shocking is that he is only 43, so basically my age, give or take. Seems like he has been at this a LONG time. I used to buy from him at Carbo's St. Paul church shows in the mid-90s when I was in my mid-20s before he was with Metropolis and he sure as heck seemed like he was 10+ years older than me. Carbo must be approaching 60 by now if he's not already there. I remember buying from him at shows when I was 12.

Also location has a lot to do with breaking out into the top tier.

New York is the comic book capital of the world. Especially back in the mid-90s.

Kind of like Hollywood was the place to be if you wanted to be discovered as a big player in the movie industry.

[the blob]

that's true, my local shop had a lot of people who worked at DC and Marvel (in the exec side as well as writers/artists) who came by. It was easy for him to get people to sign a stack of books and then he'd just put them out on the rack at cover price back when an artist/writer's signature was considered a "good thing" despite not being witnessed by a cgc rep...

[HighStakesComics]

You guys in NYC have it pretty good. Here in Ohio we get neglected for the most part, but I am curious to see who all has booths at the November Wizard World show up in Columbus.

[the blob]

You guys in NYC have it pretty good.

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For comics I guess. Everything else is just too expensive. I need to move.

[ComicConnoisseur]

You guys in NYC have it pretty good.

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

 

For comics I guess. Everything else is just too expensive. I need to move.

With more and more outsourcing, digitized works and internet job focus I think the playing fields will get evened out for a more level field. Those location advantages won`t be as big as a factor as they once were.

Still it must have been a great advantage to live in the NY area during that gold rush for comics in the early-1980s to mid-1990s.

 

[shadroch]

Folks used to sell comics on street corners.

[lou_fine]

My personal opinion is that comics are not a good investment. You can make money buying and selling comics, but a static "buy at current market prices and hold indefinitely while the prices go up over time" is not a good money making strategy.

 

 

I assume you also gave this same investment advice to Warren Buffet with respect to his investments.

 

Actually, I have also heard this same line of thinking over the past 30 years with respect to comic books, yet history has clearly shown us that buying the right type of books can certainly make you money over an extended period of time.

 

 

[Lennart76]

[namisgr]

Actually, I have also heard this same line of thinking over the past 30 years with respect to comic books, yet history has clearly shown us that buying the right type of books can certainly make you money over an extended period of time.

 

 

The difference between making money and investing is one of scale. It's there that buying and selling comics as a hobbyist falls short of investing in other types of assets.

[Hamlet]

It's funny you should mention Buffett. He generally doesn't think highly of investments in commodities or collectibles. His explanation of why is in his 2011 letter to shareholders on page 16--

 

http://www.berkshirehathaway.com/letters/2011ltr.pdf

 

Start reading at the section "The Basic Choices for Investors and the One We Strongly Prefer"

 

His critique of investing in gold is a must read. His reasoning would apply to comics as well.

 

I assume you also gave this same investment advice to Warren Buffet with respect to his investments.

 

Actually, I have also heard this same line of thinking over the past 30 years with respect to comic books, yet history has clearly shown us that buying the right type of books can certainly make you money over an extended period of time.

 

[rjrjr]

It's funny you should mention Buffett. He generally doesn't think highly of investments in commodities or collectibles. His explanation of why is in his 2011 letter to shareholders on page 16--

 

http://www.berkshirehathaway.com/letters/2011ltr.pdf

 

Start reading at the section "The Basic Choices for Investors and the One We Strongly Prefer"

 

His critique of investing in gold is a must read. His reasoning would apply to comics as well.

 

I assume you also gave this same investment advice to Warren Buffet with respect to his investments.

 

Actually, I have also heard this same line of thinking over the past 30 years with respect to comic books, yet history has clearly shown us that buying the right type of books can certainly make you money over an extended period of time.

 

 

 

That was an incredible read. Thanks for sharing. (thumbs u

[ComicConnoisseur]

It's funny you should mention Buffett. He generally doesn't think highly of investments in commodities or collectibles. His explanation of why is in his 2011 letter to shareholders on page 16--

 

http://www.berkshirehathaway.com/letters/2011ltr.pdf

 

Start reading at the section "The Basic Choices for Investors and the One We Strongly Prefer"

 

His critique of investing in gold is a must read. His reasoning would apply to comics as well.

 

I assume you also gave this same investment advice to Warren Buffet with respect to his investments.

 

Actually, I have also heard this same line of thinking over the past 30 years with respect to comic books, yet history has clearly shown us that buying the right type of books can certainly make you money over an extended period of time.

 

 

 

That was an incredible read. Thanks for sharing. (thumbs u

Yes, a great read. Warren Buffett loves his Big 4.

[thunsicker]

+1. Thanks for posting that. That guy really knows how to invest.

[RockMyAmadeus]

 

Yes, I believe him. Comics helped me buy my old business. Comics bought me my first new car. Comics bought my co-op.

 

...at a time when comics as collectibles were on their way up.

 

 

And I appreciate you answering and your honesty. The question is will this trend continue long term?

 

 

No.

 

The conditions no longer exist.

[RockMyAmadeus]

There seem to be at least three different scenarios that all get lumped under the "buying comics as an investment" banner.

 

1) Buying at market prices and holding for resale at some future point. This is not a good investment for a variety of reasons, and ultimately you can put your cash outlays to better use and make more money that way.

 

2) Buying comics that can be "potentialized" and sold for more money than you paid by virtue of the book achieving a higher technical grade. This is not investing, it's a type of arbitrage. It takes skill and money can be made if you're good at identifying the undergraded or misgraded books.

 

3) Finding comics at less than market value and bringing them to market at retail price. This is not investing, it's called being a dealer.

 

My personal opinion is that comics are not a good investment. You can make money buying and selling comics, but a static "buy at current market prices and hold indefinitely while the prices go up over time" is not a good money making strategy.

 

 

If somebody bought the top ten SA Marvels in 6.0 at market price in 1980, would they have done well?

How about in 1990?

Suppose a latecomer joined the party in 2000 and paid market value for the top ten Marvel SA books.

Now, lets say someone was really really late to the market and bought them in 2010.

Did he miss the money train?

Any reason to think someone buying them today will regret it in 2020?

 

The definition of "6.0" in 1980, and "6.0" in 2014 is so vastly different as to render the entire example functionally useless. "6.0" didn't exist, and "Fine" covered what is now 2.0 to 9.0. Comic books, in 1980, weren't priced at "Mint/Fine/Good" unless they were expensive (read: $1,000 or more), and even then, there was considerable fudging going on.

 

You almost always paid the Mint price for anything that still had the cover attached, and God forbid it was restored. If you paid $500 in 1980 for a "Mint" Fantasy #15 that turned out to have color touch and turned out to be a CGC 6.5, you would have seen an approximate 10-fold increase by 2014, 34 years later...which is a very moderate ROI. (about 7%, far less than the then-current percentage rate for municipal bonds, at around 18%, were giving.)

 

Even if you hadn't bought restored, far and away collectors were simply buying ONE copy. Great to sell that 6.5 for $30,000....but you did it once.

 

By 1990, the going rate was $6,000-$8,000...and, while grading was tighter, it still wasn't anywhere near what it is today, and there spectre of restoration hung over it all. If you bought a "NM" Fantasy #15 that had color touch in 1990, you have lost money. And Fantasy #15 is a color touch magnet. People just LOVED to take brown magic markers to that cover.

 

By 2000, you've finally got the twin issues of undisclosed restoration and overgrading within spitting distance of resolution, but...prices have been all over the map.

[shadroch]

There seem to be at least three different scenarios that all get lumped under the "buying comics as an investment" banner.

 

1) Buying at market prices and holding for resale at some future point. This is not a good investment for a variety of reasons, and ultimately you can put your cash outlays to better use and make more money that way.

 

2) Buying comics that can be "potentialized" and sold for more money than you paid by virtue of the book achieving a higher technical grade. This is not investing, it's a type of arbitrage. It takes skill and money can be made if you're good at identifying the undergraded or misgraded books.

 

3) Finding comics at less than market value and bringing them to market at retail price. This is not investing, it's called being a dealer.

 

My personal opinion is that comics are not a good investment. You can make money buying and selling comics, but a static "buy at current market prices and hold indefinitely while the prices go up over time" is not a good money making strategy.

 

 

If somebody bought the top ten SA Marvels in 6.0 at market price in 1980, would they have done well?

How about in 1990?

Suppose a latecomer joined the party in 2000 and paid market value for the top ten Marvel SA books.

Now, lets say someone was really really late to the market and bought them in 2010.

Did he miss the money train?

Any reason to think someone buying them today will regret it in 2020?

 

The definition of "6.0" in 1980, and "6.0" in 2014 is so vastly different as to render the entire example functionally useless. "6.0" didn't exist, and "Fine" covered what is now 2.0 to 9.0. Comic books, in 1980, weren't priced at "Mint/Fine/Good" unless they were expensive (read: $1,000 or more), and even then, there was considerable fudging going on.

 

You almost always paid the Mint price for anything that still had the cover attached, and God forbid it was restored. If you paid $500 in 1980 for a "Mint" Fantasy #15 that turned out to have color touch and turned out to be a CGC 6.5, you would have seen an approximate 10-fold increase by 2014, 34 years later...which is a very moderate ROI. (about 7%, far less than the then-current percentage rate for municipal bonds, at around 18%, were giving.)

 

Even if you hadn't bought restored, far and away collectors were simply buying ONE copy. Great to sell that 6.5 for $30,000....but you did it once.

 

By 1990, the going rate was $6,000-$8,000...and, while grading was tighter, it still wasn't anywhere near what it is today, and there spectre of restoration hung over it all. If you bought a "NM" Fantasy #15 that had color touch in 1990, you have lost money. And Fantasy #15 is a color touch magnet. People just LOVED to take brown magic markers to that cover.

 

By 2000, you've finally got the twin issues of undisclosed restoration and overgrading within spitting distance of resolution, but...prices have been all over the map.

 

 

Something tells me you were not buying comics in 1980. Where do you get this stuff?

Just because a couple of mail order dealers sold their wares that way doesn't mean the general market did. I have many Very Fine books in my original collection that would be 7.5s or higher if slabbed. My Avengers 1 was bought as a VG and came back as a CGC 4.0. MY DD #1 that was bought as a VG is now a purple label 4.5, but seeing how I paid $27 for it and sold it for $217, I'm happy. Heck, I'd buy it back for $300 anyday.

[HouseofComics.Com]

Exactly. There were lots of people selling comics at GD, VG, and FN in 1980. I certainly was by 1983.

[lou_fine]

My bet is that almost every single purchase of high grade Silver Age before the year 2000 are big winners because of CGC coming into the picture (and the internet marketplace) which dramatically changed everything about high grade collecting, not the least of which was huge gains in value.

 

Possibly the case with HG SA books and most definitely the case with uber HG BA and CA books as nobody was crazy enough to pay ridiculous money for high grade copies of common books.

 

Not so much with respect to HG GA books as I remembered dealers routinely offering multiples of guide for copies of high grade or pedigree GA books years before CGC even came onto the scene. In fact, it would appear that the multiples for these types of books have actually dropped significantly with all of the GA CGC books out there and auctions that have taken place over the past decade or so.

[RockMyAmadeus]

 

Something tells me you were not buying comics in 1980. Where do you get this stuff?

 

In just about every publication written during, and after, referring to the hobby during that era, plus decades of my own experience.

 

Just because a couple of mail order dealers sold their wares that way doesn't mean the general market did. I have many Very Fine books in my original collection that would be 7.5s or higher if slabbed. My Avengers 1 was bought as a VG and came back as a CGC 4.0. MY DD #1 that was bought as a VG is now a purple label 4.5, but seeing how I paid $27 for it and sold it for $217, I'm happy. Heck, I'd buy it back for $300 anyday.

 

Ok, but you know that these are just anecdotes, right...?

 

Because the very existence of CGC, and the extreme prices slabs have seen when compared to the raw market alone, tells a completely different story.

 

If there wasn't widespread, systemic overgrading and non-disclosure of restoration, CGC wouldn't exist. There would have been no need.