What would you invest in?

[greggy]

I heard that you were grade conscious in the early 1990s. Unfortunately, that is why you are stuck with a bunch of worthless Valiants!

[murph0]

Actually not everyone was..how do you think I got most of my NM ASM's? :\

You just have to have an eye for it, too many people will just settle for what someone tells them it is. I'd only ever buy a book back then if the spine was flawless and the corners were sharp, etc etc. I can guarantee you many a person selling CGC books today bought a lot of them during the cash poor raw days of the 90's and are making some pretty nice R.o.I....

 

Brian

[clobberintime]

So that story about you making a million dollars off that Spidey 101 was not true! I heard that book was found with a moldy stick of butter after being "lost" for decades. Another urban myth dispelled by the Gregster!

[dam60]

I heard that you were grade conscious in the early 1990s. Unfortunately, that is why you are stuck with a bunch of worthless Valiants

 

Valiants true worth lie in the stories! They were meant to be read and enjoyed!

 

DAM

[hammer-migration]

"I bought a CGC 9.2 FF 25 from Greggy a few years ago for around $600. I think he paid about $50 for that one"

 

"Greggy paid $5 for a Spiderman 101 that got a 9.8 that he sold for something like a million dollars!"

 

These statements prove one thing above all else. The key to being a successful enterpreneur is not necessarily the book itself (although these two mentioned DO happen to be "Killer" issues). LEVERAGE is the most important mitigating factor to realizing/actualizing profit potential. There is NO SUCH THING as a "bad" or "good" investment. The protfit potential equation is based solely on the LEVERAGE. The price that was initially paid for a book. If you're looking purely at cash potential (the bottom line...the NET), a Fantastic Four 3 in VG/FN can turn out being a better investment for you if you bought it for $80, and flipped it for $240 (realizing a $160 profit..TRIPLING your money), than a Spiderman 1 in VF that you're BURIED in for $10,000 and can't seem to get even an opener at $9,000!!

When investing in ANYTHING, you can't just look at the item itself and estimate it's rise (or fall!) long or short-term. The item's PRICE should dictate it's potential to make the piece WORK for you, rather than the other way around.

*HENCE, to ignore a book based on its title, number, and condition would SEVERELY limit your avenues of investment opportunity. That VG run of Metal Men #1-35 that most would entirely overlook, could be a fast, easy C-note in your pocket if its bought AT THE RIGHT PRICE. With LEVERAGE! You have to keep an open mind, and not overlook ANY opportunity.

 

*(TM copyright Araich)

 

 

[comicmankev]

Some very good points from most people, but still slight evading the point!

 

This is not about me making a buck, it is a hypothetical question that someone may ask you. You call yourself an agent or whatever, if someone wanted to invest any of these amounts and was relying on you to do your best, what would you buy in each price bracket?

This is an investor that has given up on the Stock Market and read in the NY Times that comics were potentially great investments (18%+ per year WOW). He is ready to pay you some on top for your trusted advise, and really doesnt give a blue blazes whether the book is good to read or not.

 

Some of the comments are getting a bit confused with the love for comics. FORGET YOUR LOVE FOR COMICS, FORGET WHY YOU (YES YOU) BUY THEM, THIS MAN DOESNT CARE ABOUT YOU! But he may reward you nicely in the future if it pays off, so don't abuse him!

[dam60]

One thing just to add: I can buy a lot of comic books (overstocks lets say) for between 5 and 10 cents. I can probably sell a lot of them at 25 cents, making a profit of 400%. However, it's not worth my time. Don't forget to look at the "opportunity cost" in making comic book investments.

 

Also, "Leverage" is associated with debt and is not the same as "the price that was originally paid for the book"

 

DAM

[delekkerste]

I can buy a lot of comic books (overstocks lets say) for between 5 and 10 cents. I can probably sell a lot of them at 25 cents, making a profit of 400%

 

True...that's why they teach you in business school to calculate the net present value (NPV) of an investment's cash flows instead of relying on an internal rate of return (IRR) figure...oftentimes an investment with a higher IRR can have a much lower NPV, like in the example you cited above.

 

Anyway, to address ComicManKev's hypothetical question, I'd tell this client to stop relying on the popular media for investment advice. No asset class can maintain an 18% compounded annual rate of return indefinitely...in fact, if history is any guide, you should be looking to sell any asset that has done so for a number of years, not buy. I'm not a big fan of stocks these days (though I do trade opportunistically), but I still have more confidence in high-quality stocks than in the comic book market, which is slowly going the way of the dinosaur and dodo. Don't extrapolate past performance indefinitely into the future...that's a sure way to wind up poor and sorry.

 

Gene

[dam60]

I agree with Gene about the 18% return, but to look at comics that I would buy for investment here are a few thoughts:

 

-I would focus on silver age 8.0 and 8.5 (and perhaps some 9.0s) which can be gotten for next to nothing compared to what the higher grade multiples can bring. I think that as the truly HG SA books (9.4 and above) stay at high levels, these books will be gobbled up by more cost conscious investors

 

-I am a big fan of Avengers 4

 

-Neal Adams Batman books which I find are quite undervalued

 

-I would aggressively avoid investing in any modern book

 

My two cents,

 

DAM

 

 

[FlyingDonut]

If we are making a few assumptions - that the guy already has decided to invest a portion of his money in comics (and I think a diversified investment portfolio can have comics in it), and that he has some money to invest, I would advise him to put his money into:

 

- Pre-1943 Superman and Batman books

- Pre-1942 Captain America

- 1956-1961 Superman and Batman

- 1947-1955 Archies

 

I would also advise him NOT to buy slabbed copies, rather buy the highest graded UNSLABBED copies he can find.

[joe_collector]

>>This is an investor that has given up on the Stock Market and read in the NY Times that comics were potentially great investments (18%+ per year WOW). He is ready to pay you some on top for your trusted advise, and really doesnt give a blue blazes whether the book is good to read or not.

 

I'd recommend staying far, far, far away from the comic market, since as a by-product of the average populace taking an interest, comics are vastly over-valued and not a good investment at all.

 

Why would anyone think with all this attention, Heritage providing a visible front, tons of mainstrean, high-profile "comic investment" media articles, and the Spider-man movie making zillions, that comic book prices will continue to rise 5 years down the road?

 

Any sane person should see that the natural course of action will be a downward slope, as you can't get any hotter than CGC was a year or so ago.

 

 

 

 

[comicmankev]

Well, I was just stating what this guy COULD have read that got him interested, everyone knows that an 18% return is never guaranteed, otherwise everybody would be doing it, right? If somebody was willing to pay you to find them a good investment would you really tell them "It can't be done. I don't want the challenge or your money, take it away and buy some gold, or better still, some Diamonique!"

 

Thanks for your input DAM60, thats getting back on track.

[delekkerste]

If we are making a few assumptions - that the guy already has decided to invest a portion of his money in comics (and I think a diversified investment portfolio can have comics in it)

 

I don't disagree with you...I'm sure a lot of us have accumulated a meaningful dollar amount of books over the years and have a vested interest in the comic market even if we haven't approached our buying from an "investor" perspective.

 

I do think it's dangerous, though, for people (as in CMK's example above) to "give up" on stocks/other traditional investments and decide that they're going to fund their future hopes and dreams from buying comic books (in hindsight, it may have been possible if you bought before the parabolic rise of the last decade, but that was then and this is now.) In general, I think prices are too high and the long-term future of the hobby too bleak to consider investing in funny books for the long-haul. I'll again make the exception to those who have superior market insight/access/distribution, but I think Joe Q. Public should stay far, far away.

 

I know that saying this stuff is akin to heresy or slaying someone's sacred cow on this Board, but, IMHO, I think there is a lot of misplaced optimism out there and somebody needs to play the role of Devil's Advocate!

 

- Gene

[delekkerste]

If somebody was willing to pay you to find them a good investment would you really tell them "It can't be done. I don't want the challenge or your money, take it away and buy some gold, or better still, some Diamonique!"

 

Actually, I'd tell him that I wouldn't want to invest his money in a way that I wouldn't feel comfortable doing myself. I'd tell him that there is no free lunch in the markets, and that to earn an 18%-type return, he's going to have to take on a disproportionate amount of risk, including some specific to the comic book industry (changing collector tastes, CGC-induced price volatility, illiquidity compared to stocks, storage costs, etc.)

 

I would tell him that if Warren Buffett, the greatest investor in history, is smart and patient enough to currently earn 1% in a money market account while waiting for bargains to materialize, well, who am I to refute that strategy? Why do you have to be "in the market" (stock, comic or otherwise) at all times? It's all about timing. If you were prescient enough to hoard super high grade keys 10-15 years ago, my hat goes off to you. But if you didn't, there's no need to compound your mistake by paying top-dollar now. If you enjoy the books you're buying, that's one thing. But if you're in it for the fast buck (or quid, as the case may be), be patient and don't chase inflated prices, whether they be comics, stocks, bonds, or real estate (actually, when you note that 3 of these 4 asset classes are sitting at or near all-time highs, stocks don't look that bad...hmmm...)

 

Gene

[COI]

Murph, aren't you around my age? What were you doing buying HG comics in the mid-late 90's? I was too busy trying to aquire liquor in the highest poof possible, chasing ladies(some things don't change ), and driving around deciding between Wendy's or McDonalds after last call at 3am. (Man I can't wait for the summer )

 

Given my age, and the state of the market at the time(the poor quality made me loose interest in comics) I never had the chance Greggy had.

 

 

[chrisco37]

I was too busy trying to aquire liquor in the highest poof possible, chasing ladies(some things don't change ), and driving around deciding between Wendy's or McDonalds after last call at 3am.

 

.....You said it, brother!

 

Chris

[COI]

Gene,

 

Despite appearances, I actually agree with a lot of your posts. People constantly ask "what's a good investment", and I try to be optimistic by offering what I think has the BEST CHANCE at being a long term investment. But the fact is, I definetly do not look at comics as a long term(10-15+ years) investment option, simply because I feel I cannot comfortably speculate on where the industry will be. I believe that if you want to make money on books, you go for the short term. Flipping is very lucrative, and works IF you know what you're doing, and can seperate yourself from the books. But like you said, this takes a tremendous amount of knowledge and patience, but it definetly can be done. I have yet to lose on a book I've purchased with the intent to flip. Every single book I've purchased for re-sale so far has yeilded some profit, with the exception of 2 instances where I broke even. The only instances where I feel I over-paid, where on books that were for my own collection.

 

 

[Darthdiesel]

I was too busy trying to aquire liquor in the highest poof possible, chasing ladies(some things don't change ), and driving around deciding between Wendy's or McDonalds after last call at 3am.

 

.....You said it, brother!

 

chrisco is still at it in the Gaithersburg area to this day...MD ladies beware!

[chrisco37]

I'm thinking of moving the operation to VA.......Old Towne Alexandria and Arlington are un-tappped resources (not for long though.... )

 

Chris

[14 of spades]

>I would aggressively avoid investing in any modern book

 

i understand your gist - but remember, anything can happen. for the purposes of flipping, since their volatility is so high, you shouldn't rule them out.

 

remember - ASM 36 Vol 2 CGC 10.0 was only a few months old before it was fetching over 2000 dollars last year...