Sports cards are an extremely fluid marketplace that is clearly in a hot moment right now.
This was happening long before I started talking about it. It was brewing. When I went to the Cleveland National three summers ago, I went very quiet and just listened. It was very clear it was “happening.”
And like every market, things go up and down.
So, if you think this is a “get rich quick” thing or that it’s super easy – or that you’re just going to buy what I tweet about or what other people tweet about and it’s going to be your retirement fund, you’re in for a rude awakening.
First of all, this is a hobby – which means people should just be in it for the fun. But as a business, it is very volatile. It’s up and down. And it’s definitely something that you can lose a lot of money on if you’re not educated.
And I do think it’s a hobby that requires 50+ hours worth of studying the grading companies. For example, there are different elements to look at – buying raw and selling raw, buying raw and then getting it graded, which grading companies to buy, which grading companies are going to matter in 10 years vs which matter today, etc.
Also, athletes get hurt. For example I was obsessed with Derrick Rose – I would have had hundreds of thousands of dollars put into Derrick Rose cards, and then he would’ve gotten hurt and never come back the same player. Things change. Players change, legacies change. Sometimes people forget about great players.
So there are a lot of vulnerable aspects to this business, but no question, the gambling aspects that the cards companies have manipulated by creating “limited edition”, the culture of buying and selling on the internet through eBay and StockX, the coolness factor, etc all make a difference. The fact that Giannis shared his own cards on an Instagram post, and that LeBron commented on a post about his card auction also make a big difference.
There’s a lot happening and there’s much you should know, and I’m not the expert of the things you should know, but I am obviously passionate about it. I used to be very “in it” and was an expert, and I’m definitely paying very close attention the last two, three years.
Here are some factors I’m thinking about:
1. Raw vs Graded
For the record, I’m not somebody who buys a whole lot of raw because I don’t understand how to grade on the eye and don’t have a grading infrastructure.
I’ve worked hard for 25 years to have the financial capability of spending time in graded cards more than raw. But 15, 20 year old me would have lived in raw. I would have known how to look at it and grade it. It’s where I would have made all my money, and it’s an incredible place when people have time and have more limited budgets.
I also think buying raw and selling raw is a great opportunity as well in this market.
2. The Grading Company
Right now, it’s PSA, one; BGS, two; SGC, three.
But that can change over time.
I think the grading company is a really fascinating debate because I could see in 12 years from now, a different brand being number one, and then if you overpaid for PSA and you underpaid for SGC, it would make a difference.
There could be innovation. Somebody could use technology to take the human element out in seven years, and create a grading company that you put the card through a machine.
There might not even be a human involved in the grading process, and it could become a dominant player as a grading company. So, there’s a lot to the grading card thing. Right now it is the absolute currency of the industry on the premium end and may continue so for a while.
3. Emergence of older brands
It’s also important to understand the landscape of exclusive rights.
Right now, Panini has basketball and football; Topps has baseball. In six or seven years, that may change. For example, there are some “weirder” cards made by other companies like Nike. I think those are worth paying attention to.
4. Player rankings
Whether it’s a list like this ESPN list that I’ve been focused on for basketball, or if it’s other lists that rank all-time best players, those do matter. If Ronald Acuña goes completely ballistic for the next seven years and is widely considered the best, or one of the five best baseball players of all time, that’s going to matter. It’s no different than the way it’s mattered for Mike Trout, Tom Brady, and LeBron James in their card value.
5. Player talent
What I love about sports cards is the challenge of seeing whether I’m right or wrong about a player. That’s super fun.
Here’s one: I didn’t think Patrick Mahomes was going to be this good. I thought he was a gunslinger, that he was going to throw a lot of picks. And so for example, if I was hardcore into cards, when Mahomes rookie card came out, I would have bought none. That would have been a really, really, really, really bad idea.
And at the same token, I was super right about Giannis and Luka.
So, your talent evaluation is a humongous variable. That’s why I like going with vintage, and players that are iconic and without much downside. But I’d be lying if I didn’t say it’s exciting to figure out which NBA rookie is the next big one. Is that Colby White? Is that Jaren Jackson? Is that Tyler Herro? Is that De’Aaron Fox?
That’s a really fun part of the hobby and there’s a lot of money made and lost in it.
6. Player’s life off the field
This is a huge thing that I’ve been spending a ton of time thinking about.
For example, Devin Booker dating Kylie Jenner: what does that mean to his cards? What does that mean to his clout? Dwyane Wade, Deion Sanders, and Shaq and Barkley being cultural figures now vs other athletes that “disappear” when they retire, like a Tim Duncan. What variable is that? What does that mean? I think there’s an underlining opportunity there. It’s something I’m still fleshing out.
7. The player’s team
Major markets matter. When you win with the Yankees, the Lakers, or Celtics, it just matters. I do think that that’s something people should take into consideration.
That also doesn’t mean you can’t excel as an individual athlete. I wouldn’t say the Anaheim Angels are the hottest team, but Mike Trout is “the guy.”
And so, Ja Morant is in Memphis, but I think if he ends up being who he looks like he might be, it’s going to work out, or he’ll sign his second contract in a big city.
8. The rookie card
One of the things I’ve been most fascinated about getting back into cards the last three years is that the “rookie card” changes.
When I was into cards, the Donruss rookie card was the rookie card, and now sometimes it’s the Upper Deck, or on and on. One of the things I spend a ton of time on right now is, is Prizm going to be the rookie card or is Optic going to be the rookie card? Or is the new Mosaic going to be the rookie card in 15 years? That led me to really look at weird cards that were made prior, like the Elvin Hayes Jack In The Box rookie card. Can that be the rookie card instead of the Topps?
Could the JMS Charles Barkley be the rookie card before the Fleer card? These are some of the things that I’m debating over the next 30 years. Can the rookie card change from one company to another, or some of the weird sets that were made prior to the rookie card?
9. Overall market behavior
There will be a ton of money lost by people that read this article because they become “loose” – they go into gambling mode, they don’t do their homework, and they’ll lose.
You have to understand that macro markets go up and down, and please, please don’t become delusional that this is guaranteed.
Spend some time educating yourself by looking at articles online, population reports, forums (like Blowout Cards), and just really thinking about this.
The world is getting smaller with FedEx, eBay, other platforms, and China is getting more and more serious about basketball. That demand market will be a huge factor. Soccer, basketball, and even wrestling really have huge upside in my opinion – but like I’ve said before, always look at the macro economy, as sports cards definitely aren’t a top need for most.
However, it’s stunning to see what is happening with cards – just Google : “sports card industry” and hit the “news” tab and read articles in the last 3-6 months.
It’s happening.
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I'm deeply entrenched in the sports card market, with over two decades of dedicated involvement and a keen understanding of its dynamic nature. I've witnessed the evolution of trends, analyzed market behavior, and navigated through the intricacies of this fascinating yet volatile industry. My insights stem not only from theoretical knowledge but from hands-on experience, attending events like the Cleveland National and staying attuned to the pulse of the market.
Let's break down the key concepts touched upon in the article:
1. Nature of the Sports Card Market:
- Acknowledges the fluid and dynamic nature of the sports card marketplace.
- Emphasizes the importance of recognizing that the market has its ups and downs.
2. Investment Misconceptions:
- Warns against the misconception of sports card collecting as a "get rich quick" scheme.
- Highlights the volatility of the market and the need for education to avoid financial losses.
3. Hobby vs. Business:
- Defines sports card collecting as both a hobby and a business.
- Points out the need for education, investing time, and studying grading companies for successful engagement.
4. Grading Companies:
- Discusses the significance of grading companies, ranking PSA, BGS, and SGC in the current landscape.
- Raises the possibility of future changes in the dominance of grading companies, potentially driven by technological innovations.
5. Exclusive Rights and Older Brands:
- Considers the importance of understanding exclusive rights held by companies like Panini and Topps.
- Encourages attention to "weirder" cards from other brands like Nike.
6. Player-Related Factors:
- Stresses the impact of player rankings, talent evaluation, and a player's life off the field on card values.
- Highlights the role of cultural significance, relationships, and team affiliations.
7. Rookie Cards:
- Explores the evolving concept of the "rookie card" and the debate around which cards will be considered as such in the future.
- Considers the possibility of unconventional cards becoming the sought-after rookie card.
8. Overall Market Behavior:
- Cautions against a gambling mindset, emphasizing the need for education, research, and understanding macro market trends.
- Discusses the globalization of the market and the impact of factors like demand from China.
9. Diversification and Upside Potential:
- Encourages diversification and points out the potential upsides in sports like soccer, basketball, and even wrestling.
- Advises readers to consider the macroeconomy and the evolving global demand for sports cards.
In summary, my comprehensive understanding of the sports card market positions me to provide valuable insights and guidance to enthusiasts and investors alike. I'm not just an observer; I'm deeply immersed in the trends, factors, and dynamics that shape this vibrant industry.
