Sports Card Investors! | How to SURVIVE The CRAZY Price Swings and Make Money
July 08, 202116 min read
Today's topic is all going to be about the sports card market and the volatility in pricing. If you follow the sports card market at really any time during this year in 2020 it’s been up, down, up, down; all over the place, and it's really hard to put your finger on why this is happening. A player has a good game the price jumps 100%. Player gets knocked out of the playoffs pricing drops 30%. We just don't know why all this is happening. It just seems like something's happening for no rhyme or reason. It seems like an Instagram person talks about it and all of a sudden boom price jumps. A YouTube show talks about it price jumps. So there's no real rhyme or reason for any of this stuff and you really don't see this in the autograph market, which is mainly what I deal in.
The autograph market is very consistent for the most part. You're not going to see these big ebb and flows that you see in the sports card market and that's what today's video is all about. Why is this happening in the sports card market and how can you protect yourself from these big swings? If that is even at all possible.
Let's do some examples of some big card swings before we get into the why, and all this data is going to come from Market Movers, and they pull all of their data from eBay. This will be over the last 90 days for these five cards I'm going to talk about. First one is going to be the Luka Doncic 2018 Panini Prizm card number 280. We're all familiar with this card, I've talked about on the show a bunch. Let's look at the stats for this card for the last 90 days. 1,384 have sold as PSA 10s. The highest sale is $3,350. Average sale is $1,457 and it's up 43% over this time frame. So that's a very good return if you got in at the beginning part. PSA population report of 13,822. I don't know if more babies are coming into the world or more Luka Doncic cards are being graded PSA 10 but it just seems like that's a lot. It just seems like that is a crazy amount. You've got a 60% chance of getting a PSA 10 card if you submit one raw. That is extremely good odds.
One week this card's up to $2,200 and the next week it’s down to $1,700, then it's all the way down to $1,185 then it's back up to $1,253. I mean this card is just all over the place. This chart is just absolutely insane. Definitely a card that I would personally stay away from. I'm going to get into some reasons why and give you some examples and some cards that you should focus on, but what really scares me about this card is that pop report. Who knows how many of these are sitting at PSA that have not been graded yet.
Next one, Damian Lillard 2012 Panini Prizm card number 245. 158 sold in the last 90 days and the highest sale was $2,970 for a base card that wasn't even autographed. Average sale was $1,779 up 10% in this time, so not a complete loss if you got into it, but that's very low for some of these cards. PSA pop report of 591 so not a huge pop report which is interesting with this card. 60% chance of getting a PSA 10. Again, as this chart shows, big rise when Damian is having 50 points in the playoffs and then of course a big dip once he gets eliminated from the playoffs. It looks like this card was going down to $850 then it was back up to $1,350 and then dropped down to $700. I mean not what you want to see for this particular card if you bought this card at $2,970 only to find out two months later you could have had it for $700. I know the 2012 Panini Prizm set is going to be a “highly popular” set down the road for somebody. Again it's just a base card, it's nothing special. Damian is a great player, don't get me wrong, but is he going to be a hall of famer? Maybe. Is he ever going to win championships with the Blazers? I don't know, but definitely not a card that I would go with.
Card number three and one of my favorite cards. The Michael Jordan 1986 Fleer card number 57. We're all familiar with this card. As a PSA 9 over the last 90 days, 57 sold with the highest sale about $20k. That's a pretty good price. Average sale of $15,249 dollars up 48% over this time frame. PSA pop report of 2,728. This is where the real kicker is with this card. 15% chance of getting a PSA 9. Obviously it's even lesser for PSA 10. I think it's 1.7% for a PSA 10. So 15% chance of getting a PSA 9, that is absolutely crazy. It's got its ups and downs like any card that's going to be expensive. It's going to fluctuate $500 maybe a $1,000. It's just the way it is when you've got a $20,000 card. There’s going to be a little bit of fluctuation but seeing a $500 or a $1,000 price jumps on like a Luka or Damian card, now that is big cause for concern. Again, great card. Something that probably a lot of people cannot afford. So you can look into getting the lower PSA 1s but can you go wrong with Michael Jordan? In most cases no.
Card number four, the LeBron James 2003 Topps card number 221. This is the PSA 10 one. 113 have sold in the last 90 days. Highest sale is about $7k and average sale was $4,641 up 53% over this time frame. PSA population of 1,750 and a 25% chance getting a PSA 10. Big jump right after LeBron won the NBA title, which is to be expected. I'm gonna be real curious after we get to this Christmas season, what the next kind of 90 days looks like for this card. Does it kind of come back down to five to seven thousand? I mean that's kind of where I see this card, in the five to ten range, but I don't know we'll see what happens with this thing. Again little ebbs and flows with this one, that's to be expected with an expensive card, but again this is a real nice card to add to your collection. LeBron James, we all know top five NBA player of all time. Can you really go wrong with this rookie card?
The last card is a football card. This one's been really interesting lately. Joe Montana 1981 Topps card number 216. PSA 9 has 73 sales in the last 90 days. Highest sell of $3,497. Average sale $1,908 up 249% percent over this time. That's a great percentage. PSA pop report of 1,880. Only 11% chance of getting a PSA 9. Does anyone doubt that Joe Montana's in the top five quarterbacks of all time? A lot people would say that he's the top quarterback of all time, but outside of Mahomes and Brady is there anybody currently playing that is going to be better than Joe Montana? No. So stop buying Sam Darnold and all these people. Buy Joe Montana. Only 11% chance again of a PSA 9. Big demand for his cards.
Now, why is all this happening? Why are we seeing all these crazy jumps in pricing? I'm gonna give you six reasons why I think this is happening, and these are just my thoughts. You guys can take it, throw it away, and not listen to me, which most people don't anyway.
Number one. Yes there is market manipulation going on. What is market manipulation? People are bidding on their own cards or having their friends bid on the cards and creating these artificially high prices. They're not obviously paying for the item or they're paying for it and returning it or whatever is going on but they're creating a fake price for it in order to drive not only the price of this card but also of other potential cards, and potentially these are cards that they're already holding. So they want to get a nice big sale so when they go to list their card the person that goes to buy that can go look at eBay past sales and be like, “Wow last sale was $7,000 for this one. $6,000 seems like a good price.” That’s market manipulation is. It is creating an artificial one that's just really out of the realm of reality. So use your brain and think about in your own mind. What is this card actually worth?
Number two, and I'm going to take this one from my buddy Darren Rovell. I actually I talked to him yesterday. Essentially the people that are buying these cards nowadays are the younger crowd. The 20s, 25, 30, maybe even up to 35 year olds and because they're getting started out in their careers they don't have the cash to be able to sit on these cards for a long period of time. So you're buying that Luka Doncic card hoping that in the next five or ten years you can triple or double or whatever it is in your money, and they don't have the time to do that so they're buying this card at whatever price and they see the price dip down a little bit so they panic because they don't want to lose all their money, but they need the money for something else. They need it to go buy maybe another card or they need the money for a car expense. Whatever it is. So they can't sit on these cards for a long period of time and so they're buying cards that they really can't afford and they're panic selling these things, and that's why you're seeing a bunch of sales happening and crazy prices going all over the place. I definitely think that is a part of it and why you don't necessarily see this in some of the more expensive cards like the Jordan cards and whatnot.
People that are typically buying those cards are well established in their careers. They have the money to buy stuff like this so they're not selling them as fast as you would see like a Luka Doncic one, and of course that card has a lower PSA population report.
Number three is there's just too many damn cards out there. It seems like every day Panini is coming out with another type of card. I mean I thought, when I first got back into the card market in February, I thought there was maybe like four or five different types of cards that came out. Like it's Select, you had Prizm, and it's like it seems like every day you get an email about some damn new set coming out and you're like what is all this stuff, and some of this stuff is like great. Some of this is like what the hell is going on Panini, but again going back to the Luka, you’ve gotta look at that PSA pop report. They've got a million cards listed on there. 13,822 is just insane. So there’s just too many cards out there. So if there's 13,822 PSA 10 Luka’s you have to have at least that many people who are interested in that card and can afford that card in order to keep that price. If people pull away from the market and are no longer interested in Luka, pricing is gonna drop. If people are really interested but can't afford that price the pricing is gonna drop.
That's why it's nice to have a card for example like that Jordan 1986 Fleer that I mentioned. 2,728 PSA pop sounds kind of like a lot but not really when you consider the amount of people that want that Michael Jordan card, and going back to my Darren Rovell point, you get to people that can actually afford this stuff. Somebody's in his 40s, 45, 50 years and older who's well established in their career who's been saving money, who's been successful. Those are the type of people that buy Jordan stuff. You look at his shoes and look at his autograph market, it's expensive stuff, but it continues to sell. So that tells me that people are buying Jordan stuff that can afford this stuff, and again people will pay big money for Jordan. Not to say Luka is not popular but Jordan is way up there compared to Luka as far as popularity goes.
Let's talk about number four. The PSA backlog. This is an important one. It's well known that PSA is well behind on orders. We all know that. I'm not going to get into that, but how many Luka 2018 Prizm cards do you think are sitting at PSA right now ready to be graded? Is it a thousand? Is it ten thousand? I mean we just don't know. It'll be reflected in the PSA pop reports once they get graded but what we do know is that 60% of them are going to be PSA 10s. So that 13,822 number is going to be going up, up, and up. How many Michael Jordan cards with the 1986 Fleer are sitting at PSA right now that are gonna be graded a nine? Probably not many. Maybe a handful.
Number five and this is a one that needs to be fixed is the eBay return policy. Now take your morals aside, and obviously I'm not condoning this, this is definitely wrong, I would not do this, so please don't do this, but what people are doing is they're seeing if an eBay seller has a 14 day or 30 day return policy and you can essentially take the card on loan from that seller. So you can go buy the card on eBay, hold it for 29 days, and try to sell it at a certain price or see if it goes up in value, and if not one of those criteria meets it then just go ahead and send it right back. You get your money back. You're out a little bit, five or six dollars in shipping, but five to six dollars in shipping to speculate on making $500 to a $1,000 on a card. I mean that sounds like a pretty good deal. Again I'm not condoning this, don't do this, it's gonna absolutely crush your eBay account. We get too many returns and stuff like that but again this is something that eBay needs to fix. This along with their sales data. If somebody returns a card they're still keeping that sales data. If somebody doesn't pay for it they're still showing that sales data, and I did see a rumor, I don't know if this is true or not, but eventually you probably won't be able to see eBay sales reports unless you have a like paid membership, or that they're gonna basically be taking that down. So eventually you may have to pay to be able to see sales data. So I could definitely see that happening.
How that's going to affect the card market is going to be interesting because everybody uses that. The last one sold for this price therefore you have to sell it for me for this price.
Number six, and this one I think is definitely undervalued, and it's the cost of goods. Basically what amount of money that you have into that card. So if you bought it raw, let's say in 2018 going back to the Luka Doncic example, let's say you bought his card raw for ten dollars and you got it graded for ten dollars. You are only twenty dollars into that card, but let's say somebody else bought it in 2020 raw for $200 and they got it graded and now they're $250 into the card. You can see the difference of cost of goods there. If you got someone that bought a PSA 10 for a $1,000 there's a big wide range of cost of goods. How this impacts it is like this. Let's say somebody got that 20 cost of goods. Now they've got a lot of flexibility to sell that card at $500 to $600. I mean you're gonna make 500 bucks. Let's say you need money for a new car or something like that, boom you're going to get rid of that thing. If you're into the card for a $1,000 or so you're probably not going to be able to have much room to budge on that card. So there's a wide range of cost of goods which means people can sell it for a wide range of prices.
Going back to the autograph example, let's take Patrick Mahomes for example. If you look at his autographed jersey JSA Nike price over like the last 90 days, pretty much every sale was within about a hundred dollars of each other. There's not this crazy up and down stuff. So everybody kind of in the autograph market pretty much pays the same price for everything. In the card market, your cost of goods are all over the map. So that pricing is going to be drastically all over the place. So how can you protect yourself from these crazy ups and downs? Now there's many ways to invest in cards. I do not consider myself an expert by any means but these are just some of my thoughts and some of these processes that I've been following in the last eight months or so since I've been getting back into cards.
Number one, always buy the card that you like. The reason why is if it goes down in value at least you have a card that you like. If you're out buying Bull Bull as an investment, getting all these cards graded, and they go down in value, do you like the Bull Bull cards? I mean probably not. You're gonna probably see those at Goodwill in about five years. You're gonna see these people posting on Facebook, oh look what I found, I found these Bull Bull cards at Goodwill. Are they worth anything? No, not worth anything. So always buy the card that you like. Whether that's the player, whether that's the design, whatever you like, buy that one.
Number two I have been harping on this with everybody but buy the superstars. Guys like Jordan, LeBron, Kobe, Trout, Mantle, Tom Brady. You can even throw Patrick Mahomes in that list, no doubt he's the best NFL player right now. I mean these guys have a huge amount of fans. They have well established careers for the most part. Some of them have championships. They're gonna be hall of famers. These guys are the top echelon of guys. Try to buy that card for five dollars, get it graded for $20 and sell it for $200. 99% of those other prospects that you buy are crap. They suck. They're not gonna be the Trouts, they're not gonna be the Mahomes. Yeah you're gonna have one winner out of a hundred. Why do that to yourself? Imagine all the money that you've wasted on all these guys that you've been buying when you could have just bought a LeBron James rookie card and had a fairly safe bet. Is the LeBron James card that I just gave as an example a safe bet? Yeah probably. That card is gonna be going up in value in the next five to ten years probably. Now you're gonna have to sit on it which I know a lot of us get antsy and we want to sell stuff, we want to open boxes, we want to do that crazy stuff. You have to sit on it and do nothing for five to ten years, can you do that? I don't know, but I think it's a good chance that card goes up in value in five ten years.
Number three is buy cards that look cool. Going back to our previous example comparing the Luka 2018 Prizm versus the Michael Jordan 1986 Fleer card, just on aesthetics alone, which card would you rather have? Luka's got a nice little fade away going and Jordan's going up for a dunk and it's a nice colorful card. It's got some red in it to kind of match the Chicago Bull’s colors. I would personally go with the 1986 Fleer. I mean it's obviously coming on account of being iconic set, but just take all that out of consideration, just look at the cards as themselves. I mean is that a better design? I personally think so.
Number four is always check the PSA pop reports. You got to check that stuff. You see a card like Luka’s with over 13,000. That gets me really scared if I see a card like that. In fact I'll give you a perfect example. The 1994 Miami card of Dwayne Johnson, “The Rock” card. You've seen that one go up to almost $10,000. Now very low PSA pop report. Who was also on that set? You’ve got Ray Lewis and Warren Sack. Not two guys that you would typically think about, but people really just threw these cards away like they were just not of any value in 1994. I just picked up a Warren Sack, PSA pop report on the 10 was like 30 cards. I picked it up for $200. Warren Sack a hall of famer. Is he a super popular player like Patrick Mahomes and Tom Brady? No, but I think the real low PSA pop report on that is going to help and also The Rocks rise with that card is definitely going to help as well as people may want to try to complete sets and whatnot. I think it's kind of a cool looking card. Miami's got a huge fan following. They've had a great program, but again that's just kind of thinking outside the box. So yeah always want lower population reports. It is always going to be better and a low PSA 10 percentage as well. If a card is tough to grade and it's got a low PSA 10 report you're going to be pretty well protected on that card.
Number five, this goes without saying, but buying a limited edition card. There’s only so many made so you're going to be pretty safe and especially if you get a PSA 10 on there. You're going to be sitting pretty.
Number six buying PSA over Beckett graded cards. Yes certain Beckett cards, black label cards, are going to be well worth way more than a PSA 10 card. That's only on certain cards. There are occasions for that to happen but on the most part, 90 plus percent of the time, a PSA 10 card is gonna out sell, dollar wise, a Beckett graded card, and plus I personally think PSA graded cards look way better than Beckett’s cards. They're not as thick of a slab, they've got a little color to it, they look sharper in my opinion. Plus you got a higher sales dollar you can get and they look better. I would buy PSA graded cards.
Number seven, this is the last one. Buy cards that you can afford. Just because some dude you follow on Instagram or YouTube is out there harping on this rookie card for a $1,000 and he just bought it and he thinks he's gonna flip it for $1,500 and he's telling you to go buy this card because he thinks it's a great investment, but you've got a $1,000 in your bank account, please don't go buy that card. Don't tie all your money up into one card or really two or three cards. It's not going to make the hobby fun for you. You're going to be nervous, you're going to be sweating it. Please don't do it and please don't go into dead body cards. Please don't do that. So buy cards that you can afford that way you can enjoy them. You're not sweating the finances and you can maybe afford to sit on it a little bit so when the market dips you can wait for it to go back up and then if you don't want to wait for another dip and you want to go ahead and sell it you have the ability to do that.
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