With every set that’s released there is huge hype. Some cards are overhyped and never make it out of the starting gate. Some dark horses trail just far enough behind the pack before overtaking everyone at the last bend (the Pro Tour). What I’m saying is betting on card prices is a lot like betting on horses, and too many people bet money on horses that have already lost. If it was obvious, most people wouldn’t have this problem but I also think it’s a mentality. Let’s talk about what makes a good speculative purchase (or spec) and what makes for a bad spec or keep.
The Tale of Two Specs
So before we can talk about what makes a good or bad spec we need to talk about the two main different types of specs. They both have upside and downside but it’s important to know why you’re purchasing a card before you decide if it’s a good or bad time to buy. Short term speculation is the most common speculation to do because it’s very easy to see when it’s good or bad. It’s also most popular because it has the most immediate rewards. Long term speculation requires a lot less work but it requires a lot more patience. You need to make a choice on what you’re looking to get out of a card before you decide to buy or hold onto them.
Short Term Memory
There’s a few ways to speculate short term on a card. It’s pretty easy to predict when price spikes will happen and you can plan accordingly for them. Let’s take a look at a Standard staple and see how you could have made money buying in at the right time.
While looking at this price graph you can clearly see the peaks and valleys, and none of them are that surprising to the trained eye. The best times to buy cards for short term investments are right before set releases. The best times to sell are right after the Pro Tour. You can see that it doesn’t always work out that way and sometimes you lose money doing it “correctly.”
The first spike you can see is right before the set Battle for Zendikar was released. This is pretty typical of cards during the pre-order period to see some huge gains despite not seeing any play (since they’re not available yet). At this point the price point of a card is not indicative of its future price. At this point it’s similar to how betting on a sports champion works in Las Vegas. The teams with the best odds to win are not necessarily the teams most statistically likely to win. They’re the teams the bettors think are most likely to win. This causes some weirdness where the team might have a very low chance to actually win but has bad betting odds because people don’t care and are betting for them anyway.
Bring to Light is a card from the same set that had some good Vegas odds. It was popular early and proved to not be quite good enough to see consistent Standard play. This is the typical problem with a card that people think is better than it actually is. While it’s difficult to figure out early if a card is the “real deal” you want to steer clear of these cards.
The most important thing to note about a short term spec is that if people have figured it out, you’re too late. You have to make the risky call a weekend or two before you think the card will be show cased so you’re able to sell your cards to the people who waited too long.
In for the Long Haul
Long term buys are cards you should probably only be buying once they rotate out of Standard. They’re kind of like a fine wine and get better with age. The issue is that sometimes they don’t mature quite the way you want due to factors you can’t foresee. Sometimes they get reprinted before they’re reached maximum maturity. Sometimes a card is printed that completely outclasses it. The worst problem is when many people have the same thought and the price is just being propped up by speculators. The craw is slow but once you look back at a few years you can see the steady growth.
Chromatic Lantern is an example of a long term spec that worked out as perfectly as you could predict. It took 3 years but climbed from $2.50 to $8. If had not been reprinted in Commander 2016 it would likely have much more room to go. That being said, it’s only in one deck so most players are going to need 4 more copies for the other 4 decks. I think this one is still a pretty strong longer term hold if you’re not in a rush to sell. I could see it hitting $10 by next year baring another reprint.
You know what’s a bad long term investment these days? Sealed product is pretty much the worst ever since Return to Ravnica. You can still easily find boxes of Return to Ravnica for $90 in a lot of places after 4 years. Sets printed before that have been seeing more steady gains due to less product being printed but they’re unreasonably expensive now.
The bread and butter of a long term spec is a card that does something very unique and isn’t likely to be reprinted soon. With the amount of product that gets opened you should also try to stick to mythic rares. It’s hard for rares to become very expensive for more than a week or two. Some of the best cards to hold onto are Deploy the Gatewatch, Startled Awake, and Void Winnower. They’re also pretty unique cards with fairly low price tags right now. The risk with a long term spec is you open yourself to getting killed by a reprint. However, when they print similar cards without reprinting the one you bought, you do well.
Doing the Math
The last thing to make sure you realize is that you need a good margin to even make money on any speculative pick up. For example, if you bought a Chromatic Lantern for $2.5 and sold it on various auction sites for $8 you’d end up getting paid about $6 after fees and shipping. After the $2.50 you spent, you’d end up with $3.50 profit. So, despite the price more than tripling you only made 1.4x what you spent. The problem then lies in the fact that you need to see a large gain to actually make any money for your effort. If you bought Gideon for $17 and sold them for $20 you would make about $0.30 on each copy if you ship without tracking. You need to make sure if you’re going to buy a card for $4 that it can go to $8 not $5 because you might end up losing money even if it increases in price.
My last point involves people that have this mindset that “it might go up,” and never trade or sell anything they own. To dispel this thought process let’s think of this — almost every card in Standard is going down. After the Pro Tour is a 3 month period of decline across the board. If you don’t play with a card then there’s not a lot of reason to hang onto it. It’s the false value people assign to cards that causes a lot of price memory and doesn’t bring cards down to what they should actually be worth. For every card that goes up in price after the pre-order period, there are probably 50 that go down. Do yourself a favor and don’t hang onto things you don’t need because it might go up. The sellers remorse is a big deal for some people that also sell too early. For every “Oh man I could have gotten $18 for my Smuggler's Copters instead of $15 if I waited” story, there are many more “Oh man I waited too long and I could have got $15 for my Smuggler's Copters but now they’re $9.” The saying to help ease buyer’s remorse is to make sure to “leave the last 10% to the next guy.” Don’t expect to get top dollar for every card you ever buy or sell, just getting a reasonable rate most of the time still lets you end up coming out ahead.
With the end of the year coming up there are not many big tournaments left to drive the price of cards. You’ll see everything start to slip and that’s to be expected. If you’re looking to make a big purchase or finish off a deck, try to buy during December. The week of Christmas is on average the lowest price point in the next 6 months.
You may have seen that Skred won the Grand Prix in Dallas. A lot of people made the assumption to buy out copies of Snow-Covered Mountain. They were already more expensive than other snow basics because of Skred so I can’t recommend buying them. At this point it would be a good time to dig out any you have and sell them while they’re hot.