Sports Card Investing
Sports Card Investing
Sports Card Investing is back and in demand. It is a form of investing in which individuals purchase sports cards as a commodity and hold them for a period of time with the intention of selling them in the future at a better price in order to make a profit. It’s not like conventional equity investments or bonds that have their value linked to the assets and profits created by the underlying firm. Sports Card investing is also different from real estate which has its valuation connected to revenue sources from rentals or a house or land’s value.
Sports cards are simply a photograph on cardboard with no intrinsic value. The only thing that derives its value is how hard it is to get and what condition it is in. To assign the value, they get graded by a professional third party. People are interested in collecting and preserving sports cards, so purchasing and selling them can be lucrative. It is a type of collectibles which is also known as “Alternative Investments”. It is like collecting rare coins and wine that appreciate in value and quality over time. Investing in a Sports Card is a good way to diversify your portfolio.
Sports Card investing is fun if you decide to find a single card that will pay thousands overnight but if you consider it as an asset and include it in your portfolio then it should be a small portion of your portfolio just to diversify asset allocation. Your portfolio should largely consist of stocks and bonds with a ratio according to your risk appetite and a small portion in Alternative Investments like Sports Card, Gold, Crypto, or Art.
The Sports Card collector/investor market is on fire right now for baseball, basketball, and football cards. It is important to have knowledge about the players and the teams before entering into sports card investing. With any other investment, Sports Card Investing also requires extensive research and would also require you to make player projections for making the right investment. If you have been a long-time collector, then you have the knowledge of the players that you might want to hold onto. The novice investor who is starting to invest in Sports Cards has to understand and research a lot before investing. Making appropriate projections for the player’s rookie cards and buying a bunch of their cards before the rest of the market does when they are famous is the best way to earn a profit on your investment.
Most of the cards are worth pennies and will not go up in value unless you pull a true autographed rookie card. Investors will only invest in the graded cards from the two largest grading professionals which are Professional Sports Card Authenticators (PSA) and Beckett Grading Services (BGS). These grading companies grade the card between 1 and 10 on the basis of how rare the card is and what condition it is in. To get a proper grade, the card needs to be both rare and in good condition. If the card is rare in production and of high grade, you can earn thousands. For instance, you could have earned $96,000 for Jordan’s Gem 10 rated card (a perfect grade).
There are different strategies in Sports Card Investing like any other investment. Long-Term Investing, Flipping, Collecting, Sports Betting, and Gambling are some of those strategies used while investing in Sports Cards. Long-Term Investing is focused on the legacy of the player instead of one game or a season. This strategy requires a different approach and thought process than short-term investments like flipping. Flipping is a type of strategy in which you buy a sports card today with the intention of selling it the next day or in a week. For this type of strategy, you need to have a deep understanding of the game and the player. Another type of strategy is Collecting, where you collect the Sports Cards just as a hobby and not as an investment. But this can change to long-term investment or flipping in the future if you decide to earn a profit from your collection. Last but not least is Sports Betting and Gambling. You can tell from the name that it is a type of gambling where you bet on a team or player for a game or season. You can also gamble on a player to win the Rookie of the Year, buy their card, and flip it after they win. That is another way to do it.
To sum up, in order to make the investment profitable, it is very important to have knowledge of the team and players and do thorough research about the type of the card, the year, how rare the card is, and the player you wish to invest in.
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