Advantages & Disadvantages of Investing in Sports & Trading Cards
You search for alternative investments and think about investing in trading cards instead of stocks or other classical asset classes?
Great! This article is exactly for you since I will show you the pros and cons of investing in trading cards in the following chapters.
Advantages of Investing in Trading Cards
- Investing in trading cards can diversify your portfolio
- Buying sports cards as an inflation hedge
- Trading cards are easily portable
- Investing in trading cards can be interesting
- You can brag with your trading cards among your circle of friends
- Collecting and investing in trading cards can turn into a real hobby
- Trading cards can increase a lot in value
- Some people even get rich by investing in trading cards
- Buying trading cards can be exciting
- Investing in trading cards has become pretty popular
- You can make real bargains in the trading card market
- Many free good sources to inform yourself about trading card investing
- Many different kinds of trading cards out there
- You may be able to recall nice memories from your childhood
- Easy to store trading cards
- You don’t have to worry about burglars much
- You can scale your trading card portfolio rather quickly
Investing in trading cards can diversify your portfolio
One advantage of investing in trading cards is that you can diversify your portfolio.
In fact, the value of trading cards is not strongly correlated with stock movements or other major economic indicators and this may help you protect and hedge the value of your investment portfolio since you can spread your eggs across many baskets and don’t have to rely on just a few asset classes.
Buying sports cards as an inflation hedge
Investing in sports cards can also make quite a lot of sense to protect yourself against inflation since sports cards and other trading cards usually increase in value when high inflation rates are present while money in the bank will lose lots of its value within a rather short period of time.
Trading cards are easily portable
Since trading cards are relatively small, you will also have a rather easy time moving them to different locations and to carry them in your bag compared to people investing in art who often struggle much more in this regard.
Investing in trading cards can be interesting
Buying trading cards can also be quite interesting. Apart from the investment aspect, it can also be really nice to collect many different kinds of cards, to inform yourself about the value and the long-term price development and to make profound decisions based on that.
You can brag with your trading cards among your circle of friends
Since many of your friends may collect and invest in trading cards as well, you may also be able to gain a pretty high standing among your peers in case you buy rare sports cards that most other people don’t have.
Collecting and investing in trading cards can turn into a real hobby
While many people start out with investing in sports cards since they want to invest their money in a profitable manner, the investment approach often turns into a real hobby sooner or later since many people really start loving the process of buying trading cards and can’t get enough of it.
Trading cards can increase a lot in value
Another upside to buying trading cards is that those cards can increase quite a lot in value.
In fact, there are trading cards that sell for a small fortune right now and if you make the right choices and are also lucky, you may get huge returns on your investment while this would not be possible by investing in gold or most other conventional assets.
Some people even get rich by investing in trading cards
If you really know what you are doing and are also pretty lucky, you may even hit the jackpot and may get rich with trading cards investing rather quickly.
Sure, only a very small minority of people will get there.
However, the possibility still exists and if you want to have this small chance, investing in trading cards can make quite a lot of sense for you.
Buying trading cards can be exciting
You should also know that it can be pretty exciting to buy trading cards, especially if you buy whole boxes of cards since you will never know what’s inside and you can therefore also get a certain thrill and buying trading cards can make your life much better and interesting in general.
Investing in trading cards has become pretty popular
You should also know that trading card investing has become pretty popular over the past decade and you can therefore use this trend to benefit from the hype around trading cards before it may finally go away sooner or later.
You can make real bargains in the trading card market
Since it is not a perfect market and some sellers and buyers have much more information about their trading cards than others, you may also be able to make really good deals buying trading cards and may be able to sell those cards for a much higher price just a few days later.
Many free good sources to inform yourself about trading card investing
There are also many great free sources on the internet where you can really learn a lot about trading card investing and how to use it to your advantage so you can become a real expert in your field and can avoid spending lots of money on cards that have no or just little value.
Many different kinds of trading cards out there
Since there are many different kinds of trading cards out there, chances are that you will also never get bored in this regard.
For instance, if you don’t like sports card investing, you may still be interested in buying Pokemon cards or other cards and you will never run out of options and ideas in this regard.
You may be able to recall nice memories from your childhood
Another benefit of investing in trading cards is that you can also recall many nice childhood memories.
In fact, many people really like to think back to the old days and this is probably one reason why old trading cards have become so valuable.
Easy to store trading cards
Trading cards are also relatively easy to store since they are relatively small and you can therefore just put a sealed box in a dark and dry place with moderate temperatures and you will often be fine while you would have to worry much more when it comes to storing art or other items that need more attention in this regard.
You don’t have to worry about burglars much
You also don’t have to worry about people stealing your trading cards much since many burglars will not even know that your trading cards are valuable and may even leave them in your home while taking other rather cheap stuff instead.
You can scale your trading card portfolio rather quickly
Since there are so many different trading cards out there, you will also be able to scale your trading card portfolio quickly and may even be able to make a real business out of trading card investing in the long run.
Now that you know the reasons for investing in trading cards, we also have to talk about the drawbacks of buying trading cards so you will be better able to decide whether you still want to invest in trading cards or rather want to invest in a different asset class instead.
Disadvantages of Investing in Sports Cards
- Trading cards change quite a lot in value
- You may lose lots of money by buying trading cards
- You have to become a real expert in your field to beat the competition
- Trading cards are hyped right now
- No fundamental value behind trading cards
- Hard to find insurance for your trading cards
- Your cards may get destroyed in case your home burns down
- Trading cards are not as liquid as other asset classes
- Trading cards don’t pay any dividends
- Trading cards are not a safe haven at all
- Only minor scratches can lower the value of trading cards quite a lot
- You may make many mistakes at the beginning of your trading cards career
- Many fake trading cards out there
- You should not trust people in the trading card space blindly
- Patience is key for successfully investing in trading cards
Trading cards change quite a lot in value
One downside to investing in trading cards is that trading cards change quite a lot in value over time and there are often certain bubbles that collapse sooner or later and if you are unlucky, you may buy at the peak and may suffer great financial losses once the market corrects.
You may lose lots of money by buying trading cards
Some people who invest too much money in trading cards may also lose all of their wealth.
In fact, you should never invest a high fraction of your wealth in just a single asset class but should rather spread your money across many asset classes and buy real estate, gold, stocks and many other things so you will not have all your eggs in one basket and will not get hit seriously during times the market is in a downturn.
You have to become a real expert in your field to beat the competition
Investing in trading cards is also not easy and you need to spend lots of money to become a real expert in your field since people will outsmart you otherwise and only if you have more knowledge than your competition, you will be able to buy cheap enough to make real profits on your trading card investments in the long run.
Trading cards are hyped right now
Another problem with buying trading cards is that those cards are hyped right now and this means that prices are pretty high.
Consequently, you would have to buy at a pretty high level and in case prices collapse, you may get into serious trouble and may lose a big fraction of your wealth.
No fundamental value behind trading cards
You should also know that there is no fundamental value behind trading cards and once people lose interest in collecting those cards, their value will go to almost zero pretty quickly and you should keep this in mind and should be prepared for such a phase where nobody wants to buy trading cards anymore.
Your cards may get destroyed in case your home burns down
You will also get in trouble in case the location you store your cards will burn down.
In fact, there had been cases where people have stored trading cards at their homes and their homes burned down and they lost basically everything they had.
Trading cards are not as liquid as other asset classes
You should also keep in mind that trading cards are not as liquid as other asset classes and especially during times the market cools down, you may have a hard time selling your trading cards within a reasonable amount of time while you could sell most stocks and other highly liquid assets within seconds.
Trading cards don’t pay any dividends
Another disadvantage of investing in trading cards is that trading cards just don’t pay any dividends and if you want to build passive income and want to live from it sooner or later, you may be better off with dividend stocks or real estate.
Trading cards are not a safe haven at all
You should also know that while trading card investing is hyped right now, it is not a safe haven at all and you need good nerves to overcome difficult periods and should also not overextend yourself so you don’t get into financial trouble sooner or later.
Only minor scratches can lower the value of trading cards quite a lot
You also have to be pretty careful when collecting and assessing the value of trading cards since only minor scratches can greatly affect the value of your cards and if you are not careful, you may pay far too much for cards that are in pretty poor condition and may lose lots of money in the long run.
You may make many mistakes at the beginning of your trading cards career
Buying trading cards is also not great if you fear making mistakes since especially at the beginning of your card investing career, you will make many mistakes but those mistakes will often be necessary to gain experience and to become better over time and if you don’t have the stomach for this, investing in other asset classes or making money online may be better for you.
Many fake trading cards out there
You should also be aware of the fact that there are many fake trading cards out there and if you are not careful, you may make pretty bad deals and may buy cards for lots of money that have basically no value at all.
You should not trust people in the trading card space blindly
In general, the trading card industry is populated by many rather shady people and you can therefore not trust anybody and should use your own judgement to navigate in this world instead of relying on some “expert” who often just wants to use you for making money for himself.
Patience is key for successfully investing in trading cards
You also need to be a patient person to succeed as a trading card investor since you will often buy cards at a low price and hope that those cards will become valuable in many years or even decades and if you are not in the game for the long run, you may just not be able to use many nice opportunities to make really good money.
Top 10 Buying Trading Cards Pros & Cons – Summary List
|Buying Trading Cards Pros||Buying Trading Cards Cons|
|You can make good money buying trading cards||Trading cards experience huge swings in value|
|Investing in trading cards can be exciting||Trading card investing is not a safe haven|
|Buying trading cards helps you diversify your portfolio||Investing in trading cards may cost you lots of nerves|
|Investing in trading cards as an inflation hedge||You have to spend lots of time to become a true expert|
|Investing in trading cards is trendy right now||Many fake trading cards out there|
|You may be able to start real career buying cards||Trading cards may eventually go to zero|
|You may be able to make good bargains||No fundamental value behind trading cards|
|You can exploit the trading card market||Trading cards are not fully liquid assets|
|You can become a real expert in trading cards||You may lose all your money investing in trading cards|
|Trading cards are portable||You should not trust anyone in the trading card business|
Should You Invest In Trading Cards?
While investing in trading cards can be great since you can get huge returns on your investment and can also outplay the competition if you become a real expert in this field, you should also know that trading cards have no fundamental value and their value may eventually go to zero.
In the end, you should evaluate the advantages and disadvantages of investing in trading cards carefully and make your own judgement regarding whether this investment makes sense for you or not.
About the author
My name is Andreas and my mission is to educate people of all ages about our environmental problems and how everyone can make a contribution to mitigate these issues.
As I went to university and got my Master’s degree in Economics, I did plenty of research in the field of Development Economics.
After finishing university, I traveled around the world. From this time on, I wanted to make a contribution to ensure a livable future for the next generations in every part of our beautiful planet.
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