DAM60's Overstreet Comments on the Market Reports

[Red Hook]

Gene! You've been SERVED!

[FlyingDonut]

Gene:

Not that I mind your exercise in educating me about commodity metals and how much I would have made had but how about this.

 

Pick your investment choices for the year. It can be 10 items and it can contain different asset classes (bonds, stocks, precious metals etc) since I believe that is generally the "number" for a balanced portfolio. I'm sure you can come up with the fantasy $$$$ amount of what the portfolio should add up to.

 

Put it down in a thread. Have some board members put in their 10 book porfolio's and and at the end of the year do a comparison who would have done better. The books must be cgc'd and the comic portfolio should use GPAnalysis as the measurement of prices.

 

I am not volunteering for this job

 

I'll pick 10 books.

[drbanner]

Gene:

Not that I mind your exercise in educating me about commodity metals and how much I would have made had but how about this.

 

Pick your investment choices for the year. It can be 10 items and it can contain different asset classes (bonds, stocks, precious metals etc) since I believe that is generally the "number" for a balanced portfolio. I'm sure you can come up with the fantasy $$$$ amount of what the portfolio should add up to.

 

Put it down in a thread. Have some board members put in their 10 book porfolio's and and at the end of the year do a comparison who would have done better. The books must be cgc'd and the comic portfolio should use GPAnalysis as the measurement of prices.

 

I am not volunteering for this job

 

I'll pick 10 books.

 

Ok, and I'll invest in Gene's picks!

 

This is a bit of an apples to oranges comparison for many reasons, one being the scale of the investment possible in comics vs. traditional investment vehicles, the other being the high degree of variability in same-CGC-grade comic prices day-to-day due to page quality, eye appeal, etc.,.

 

However, I would be interested in seeing both sets of "picks", and on a similar thought, I am trying to set up an "investment quality" BA market tracker as discussed in the BA forum. Here's a start:

 

[Red Hook]

[OldGuy]

Old-school forum buddy I miss the most.

[delekkerste]

I am not volunteering for this job

 

I'm not volunteering either, because there are just so many flaws with this proposal that I don't know where to begin. First, what does a 1-year horizon tell you? If comics beat other asset classes over a 1-year horizon or vice versa, what can you really conclude from this? And, if comics did beat stocks over the next year, would that really be surprising given the huge beat-down stocks have given comics since the end of 2002? Second, comics are not a liquid market - what entry/exit prices would we use here? GPA, which does not differentiate in terms of page quality and where the last sale price can vary substantially and create a huge disparity in the ultimate return? Where there may only be a handful of copies in grade and where the marginal buyer may have to pay up for a copy if he can even find it? Third, could such a comic portfolio be widely replicated? I'm afraid the scientist and economist in me would insist upon this requirement. It wouldn't make a lot of sense to create a comic portfolio that could not replicated under real world conditions by more than a few people, right? And, I suspect that a portfolio of books where there is a lot of available supply would not be very attractive for the pro-comic investing crowd. And how many dollars could this strategy absorb (especially without moving prices) anyway? Can you make any real money with it, regardless of % return (again, that's why we use NPV instead of IRR to evaluate investments on Wall Street)?

 

I just don't see any upside in this for me. If I trounce the comic portfolio, people will say it's because I'm a professional investor - it won't change the minds of any of the True Believers. Hell, if the stock market trouncing comics by almost 100% over the past few years didn't convince them, nothing I do is going to change their minds. Also, I don't happen to be particularly bullish on anything at the moment over a 1-year horizon - everything I invest in is up triple-digits over the past few years (again, absolutely obliterating comic returns) and I am fully expecting a correction soon. I also don't believe in buying and holding a portfolio for a year or longer without making changes (as warranted) and I certainly don't want to waste the time "trading" a fantasy portfolio when I can make hedge fund economics trading real money. It's absolutely a no-win situation for me.

 

A longer-horizon wager (e.g., 5-10 years out) on where prices are going would make a hell of lot more sense, because that is what is relevant, not what 10 books Donut can find that will score big GPA gains in the next year even if that portfolio cannot be replicated at the same price by others. Some people will say these are excuses, but mama didn't raise no fool and I'm not taking a sucker's bet where there are so many ways to manipulate the comic end of things and where there is no upside for me in almost any conceivable scenario. I'll be happy to compare my audited financial results 10 years from now with anyone's comic portfolio, though I don't know too many people who would take me up on that offer.

[FlyingDonut]

I'd do it, but not on slabs. The big gains aren't going to be in slabbed books anyways.

[blazingbob]

Gene, Gene, Gene.

 

You always come onto the forum with the wonderful financial scenario's. I've seen them before. You are a professional, that's why I expect you to come up with a balanced portfolio. Make a statement before the year is over, not after when everyone looks like a genius. Same goes with comics. Have people pick their 10 books using CGC and GPAnalysis as the measurement of prices.

 

Pick an amount - $10,000, $100,000, $250,000.

 

Of course that will limit the "portfolio" just like it would if I were investing in stocks/bonds/cd's/etc.

 

Call it Fantasy Comics versus Fantasy stocks and see how everybody does.

[blazingbob]

Sorry, but how would raw prices be verified?

 

And technically you can't use the Overstreet price guide as a "Verifier" that the book went up.

 

Real sales, real prices.

[mrwoogieman]

newbie!

[FlyingDonut]

Sorry, but how would raw prices be verified?

 

And technically you can't use the Overstreet price guide as a "Verifier" that the book went up.

 

Real sales, real prices.

 

oh, we're talking FANTASY?

 

Of course Gene'll beat the GPA average if we're only talking slabs. All the profit is already built into the slab price.

[delekkerste]

You always come onto the forum with the wonderful financial scenario's. I've seen them before...Make a statement before the year is over, not after when everyone looks like a genius.

 

While this could make an interesting game, I don't know what it would prove. Comics could be up 25% and other asset classes could be down 25% over the next year and the other asset classes would still be way ahead of comics over the past 4 years. In any case, I would be more apt to be *selling* and cashing out the outsized gains of the past few years than buying these days, staying liquid until things get cheap again. Sorry if that doesn't fit into the parameters of the game, but that's how you make the big money in real life - back up the truck when prices are low, wait until things get expensive and then cash out. Lather, rinse, repeat. Buying and holding a static portfolio at the tail end of a bull market with a 1-year horizon? No, thanks. You'd leave me with no choice under those conditions but to construct a portfolio of T-bills.

 

Speaking of T-bills, I'd bet on T-bills vs. comics over a 10-year horizon. Or gold. Or oil/gas stocks. Definitely need a 10-year horizon, though, given the rally we've had, as we're overdue for a big correction.

[dam60]

Hi Dave

 

Alex!

[dam60]

Dave, great to see you posting again! Thought you were gone from the boards permanently.

 

Thanks Tim! I am like Batman! Lurking in the shadows! ha ha

[dam60]

Hail Dam!

 

Brad!

[dam60]

Old-school forum buddy I miss the most.

 

[dam60]

Hey Dave nice to see you stop lurking and post a few thoughts on other people's thoughts.

 

Thanks! It's good to be here

 

Everything else pretty much comes after this and depends on taste. Wine, 1st Edition Books, memorabilia - coins, cars, sports or otherwise. I touched briefly on comics and this was basically the response I got. His opinion was that because 99% of comics were mass produced their status will always be of a Niche level. Even where print numbers are low, people who have virtually unlimited resources are interested in owning one of a kind things tied to historical relevance. He thought that maybe in another 100 years comics could rise to the level of 1st Edition Books from the 18th or 19th century. His take was that for the truly large money, its not about owning the best known in existence. Its about owning the ONLY item in existence guaranteed.

 

What I took from that was that in Comics the only huge money I could ever see thrown out might be for the big 3 books. The drop off after that is a bottomless cavern. And if you think about it I guess the Uber rich are that way for a reason. If you own the only one, then the law of supply and demand is non-existant. Grading Companies, population reports, price guides etc etc. All of these variables are NOT relevant. Further, these items are not usually bought for monetary value anyway, they are bought for STATUS - so until a comic book is hanging in the Louvre, Batman 1 will always be worth a fraction of the Lichtenstein painting.

 

Jason - great post and awesome insight. It makes a lot of sense what you are saying with the whole status thing and "Indiana Jones" factor (btw - that's an awesome expression!!)

 

Don't get me wrong, I am not saying that you should take your books and sell them but I don't think that these 6 figure books are going to continue to experience the increase in the future that they have in the past. I think that you can make some good money focusing on minor keys and under appreciated books but I can't see an AF 15 selling for $1mm in today's dollars in my lifetime. An Action 1, Tec 27 or Cap 1 *maybe* but I think that comics is a niche market and that people should keep in mind who exactly the core constituents are when projecting price increases into the future.

 

DAM

[comic_manager]

2 - Kevin A Boyd (Paradise Comics Conventions; CGC - Signature Series Director)

 

Kev - it was great to see your market report in the Overstreet. You are probably the biggest and most influential "behind the scenes" guy in the hobby today and it's great to see you getting some very well deserved recognition. For those who don't know Kevin, he's also one of the nicest guys in the world (comics or otherwise), has encyclopedic knowledge of this hobby, and together with Peter Dixon of Paradise Comics, puts on the MOST fan-friendly show in the business.

 

If anyone is on the fence about the convention this year I give it my ringing endorsement (although I will not be in attendance for personal reasons). I went for the first two shows and had a great time.

I know Kevin he's my friend

[jbud73]

Hey Dave nice to see you stop lurking and post a few thoughts on other people's thoughts.

 

Thanks! It's good to be here

 

Everything else pretty much comes after this and depends on taste. Wine, 1st Edition Books, memorabilia - coins, cars, sports or otherwise. I touched briefly on comics and this was basically the response I got. His opinion was that because 99% of comics were mass produced their status will always be of a Niche level. Even where print numbers are low, people who have virtually unlimited resources are interested in owning one of a kind things tied to historical relevance. He thought that maybe in another 100 years comics could rise to the level of 1st Edition Books from the 18th or 19th century. His take was that for the truly large money, its not about owning the best known in existence. Its about owning the ONLY item in existence guaranteed.

 

What I took from that was that in Comics the only huge money I could ever see thrown out might be for the big 3 books. The drop off after that is a bottomless cavern. And if you think about it I guess the Uber rich are that way for a reason. If you own the only one, then the law of supply and demand is non-existant. Grading Companies, population reports, price guides etc etc. All of these variables are NOT relevant. Further, these items are not usually bought for monetary value anyway, they are bought for STATUS - so until a comic book is hanging in the Louvre, Batman 1 will always be worth a fraction of the Lichtenstein painting.

 

Jason - great post and awesome insight. It makes a lot of sense what you are saying with the whole status thing and "Indiana Jones" factor (btw - that's an awesome expression!!)

 

Don't get me wrong, I am not saying that you should take your books and sell them but I don't think that these 6 figure books are going to continue to experience the increase in the future that they have in the past. I think that you can make some good money focusing on minor keys and under appreciated books but I can't see an AF 15 selling for $1mm in today's dollars in my lifetime. An Action 1, Tec 27 or Cap 1 *maybe* but I think that comics is a niche market and that people should keep in mind who exactly the core constituents are when projecting price increases into the future.

 

DAM

 

Dave nice to see you too. The "Indiana Jones" analogy is not mine, actually its not even my friend from college's. Its something he over heard at a party, basically someone was commenting on a few "Midnight in the Garden of Good and Evil" type pieces that the person who threw the party had on display. When he was asked how do you decide what you are interested in, that was his response. I thought it was cool meaasuring stick too.

[tth2]

I'd do it, but not on slabs. The big gains aren't going to be in slabbed books anyways.

Too many variables, particularly in grading. And how would prices be verified?