#23 - Alternative Assets: Trading Cards
Conventional assets (stocks, bonds, funds) are heavily influenced by the markets with values constantly in fluctuation. They can also become overpriced, locking out retail investors.
Alternative assets have different fundamental assumptions: rarity. The demand for these assets increases while the supply decreases. The values of alternative assets rise slowly but steadily. 📈
Trading cards (game cards, sports cards) market has been booming lately. The value of some cards has skyrocketed more than +3500% in just 3 years.
Earlier cards were simply printed on cardboard but newer cards have incorporated higher quality material and also player memorabilia like parts of a bat or a jersey 👕:
Start collecting trading cards. Treat it like any other investment and develop a strategy. Get educated first. Going in long-term or flipping for quicker cash? Will you invest in rookie cards, vintage cards, unopened packs or error cards?
Develop a digital tool for grading sports cards 🛠️ PSA is the biggest grader in the field but had to stop taking in new cards in Apr 2021 due to skyrocketing demand.
PSA charges around $10-500 for grading a standard card. For most expensive cards the cost will go up to $1,000-5,000 per card 💰
Start an index fund for trading cards. Compile a collection and sell a fractional ownership in the collection. Collections could be grouped by type (e.g. baseball vs Pokemon) or by rarity (e.g. only cards worth $10,000 and up).
How to launch
Start by understanding the market. Learn why one card is worth $1,000 while another only $5. Start small in a specific niche (e.g. vintage pokemon cards) and build your collection up slowly. Get a grip of the basics.
Build an audience. Both the market of demand and supply in trading cards is relatively small, these are niche products. As a result, they’ll be hard to reach at scale with paid advertising. Rather, start with grassroots marketing:
Take pictures and videos of cards in person. People love pretty cards and you can build an early audience by sharing to trading cards forums and sub-reddits.
Share knowledge gained previously through content and blog posts. This helps build long term SEO and organic outreach to newer collectors looking to learn more.
Google Trends search data for sports cards has increased steadily in the last 24 months:
18 of the 41 most expensive sport cards sales have been made during 2021 😨
eBay - Still one of the biggest platforms for sports cards peer-to-peer trading.
DacardWorld - Shop for sports cards.
Collectable - Trade shares of iconic blue-chip sports cards and memorabilia.
NBA Top Shot - Digital moment collectibles for basketball fans.
Trading cards are beating the hell out of stocks 💥 From 2008 to 2021 a trading cards index was up 526% compared to S&P 500, which was up 175%.
Your Ultimate Guide to Selling and Investing in Sports Cards - How to learn buying strategies, types of cards to collect, places to buy and tools for research 🧰
Join 2,500+ founders finding new trends and opportunities:
Thanks for reading. See you next week!