Auctions
In case you haven’t heard, a unique Mike Trout signed rookie card brought $3.93 million in auction going into the private memorabilia collection of a billionaire collector. The sale sets the record for the highest public price garnered for a baseball card. As exciting as this news is it raises a lot of red flags.
So, as the buzz of the sale fades, we felt this is a good opportunity to discuss the perceived value of collectibles, including collectible toys and collectible coins, and their viability as solid investments.
Before you rush out and buy a bunch of baseball packs remember, beauty is in the eye of the beholder. And to our point, the value of this beauty is very subjective. As one of a kind, the card is indeed rare. The piece was certified in near perfect condition with a flawless signature from the player a 3x MVP generational talent and one of the great athletes of our time. A number of factors go into determining the value of any collectible whether it’s a Rolls Royce 15 HP, an original Picasso painting, or a baseball card from 2009. This collectible card checked off a number of rarity boxes, but at $4,000,000 we doubt this collector will ever reap any financial benefit from this purchase.
Currently, there is a sort of bubble, with a few well-heeled collectors driving up the prices on the top end of these paper collectibles. This has caused a rash of collectors taking these prices and applying them to the genre as a whole. This is a dangerous game. The buyer of the Trout card likely knows he’ll never reap a profit and probably doesn’t care. In his wake, others are buying up recent print runs hoping for the next big hit. Most will likely see the bulk of their purchases wane and many will simply lose out. This isn’t to say every card is a bad deal or that comics and other pop culture collectibles are bad investments. We only suggest caution. When considering investing in these arenas choose wisely and assume the worst. Some collectibles, like building a collection of coins, stand the test of time, but most simply don’t.
How are these cards valued?
When it comes to the Trout card price, there is no Blue Book number you can look up and say, “I’ll pay bid - four million.” Most sports memorabilia are tough to value. Collectibles like this are priced through a loose algorithm of condition, overall rarity, and circumstance. There is a supply and demand equation, but pricing goes even deeper. Current circumstances for comics and cards are skewing values making these products appear more valuable than future prices may bear out. Indeed, some are truly rare and collectible. But before you buy a bunch of modern cards citing recent trades, consider the once holy grail of baseball card rarity – the Honus Wagner card. Comparing a Honus Wagner card to this modern era Trout card shows a number of differences. The Trout card is one of a kind, but the survival rate is virtually nil on the Wagner cards making any remaining examples scarce and also windows of times past. These cards have held value for decades. The Trout card is barely a decade old.
Similarly, comic books from the golden age were read and traded among young kids that thumbed through and read them. They wrote in them, tore pages, and cut out advertisements. This attrition makes well-preserved examples scarce and some have become extremely valuable. Their appeal as with sports collectibles is still dependent on the longevity of the subject matter. Would the first appearance of Spiderman be worth what it is if Marvel hadn’t kept the character relevant? If your grandfather kept his early Superman comics in perfect condition, they’d be extremely valuable today. But the same couldn’t be said for his Blackhawk or Sandman comics. (Who? Exactly!) Honus Wagner is long gone and his legacy is set in stone. Trout could still tarnish his image and reduce his appeal as a sports icon.
What else can you collect?
The Trout card also has a limited appeal, only collectible to a relatively small group of modern US baseball fans. Other collectibles like rare coins, watches, cars, and art share a universal world-wide appeal and have already stood the test of time. Buying vintage Rolexes and Picassos have already passed this test in a number of ways. The Rolex remains a high-quality timepiece that was innovative and has maintained value through the consistent quality of materials, precision manufacturing, and limited product runs. Picasso cemented a legacy in the annals of art history and will forever be seen as a master. In a century, people will still study his move into cubism and admire his works because they transformed the art world. Mike Trout is a special player, but in 100 years there will likely be 25 or more players of his ilk. Most of his records will have been surpassed and in the hyper-sensitive public eye, he remains a slip of the tongue away from being ostracized.
So, before you go out and spend thousands hoping to catch the next Trout, consider rarity, demand, and most importantly the longevity of universal value. If you want to invest in sports memorabilia do so for enjoyment, not as an investment. If you expect returns on your collectibles, consider those that already have been tested in the crucible of time, like collectible toys, collectible dolls, or even collectible figurines. Try to avoid modern paper pop culture value with your collectibles.
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