Over the next couple of weeks, I’m going to focus on sharing some thoughts on investing in comics. I know a lot of you reading the column focus more on collecting but there are just as many who play at investing, it’s a topic worth discussing. I also know that some of you reading this are successful old veterans at this game, from you I’d like some insights shared because good karma is good karma.
Investing in comics has been one of the most profitable ventures these past 30 years, the returns for collectors lucky enough to start early and even luckier enough to keep all their stuff is astounding. If only we had a time machine. I’ve always been an optimist in value growth for comics but even I get the sense that comics collecting and investing is now an established and mature hobby. I’ve had this notion in my head that the apex came just before the release of the Avengers End Game movie. It seemed like there was a 20-year build-up to that movie that saw so much new money flood into our hobby.
Don’t read this wrong, we are in a great spot in the hobby, a very very large number of comics now have real liquid values that if you travelled back in time and told someone from 2004 of their values they would laugh in your face. Collectors who have been at it for a while are sitting pretty right now.
I don’t want to look at those collectors and investors of the past, I want to explore the prospects of collecting to invest for the future as of this moment.
It’s easy to invest in a big Bull Market, just buy at today’s prices and sit back and watch your investment grow in value. All Bull Markets have their run and comics have had theirs, and they may yet have another. There are still strains within the hobby enjoying strong price increases but I’m sure we can all agree that the general market has plateaued and in some spots, it has given some of the recent gains back.
Now we have to develop strategies, spot trends and make informed investment decisions if we want to buy comics for future profits. I don’t think a good investment strategy is just buying and buying hoping that something in the pile will ignite because of some movie announcement, for that windfall you should already have the book randomly in your collection.
Let me backtrack a bit, in this massive price run-up we’ve seen over the past few decades we’ve come to a point where there are so many comics worth real money but I’m someone who believes that there are too many books in this mix that don’t deserve their current values and that the coming years will see these books correcting downward. Remember everything got swept along even undeserving books so part of our investing strategy should be knowing what not to buy. Just as the price run-up has included undeserving comics it has also brought up books that can bear much more market value, these books are being hidden in the large pile of books that we assume have had healthy price run-ups and we just assume the market got it right. The market didn’t get it right, the market is too small and too fragmented and too busy chasing the flavours of the month to get every book right, there are good books well under value still out there.
What we need right now is a Warren Buffet style of comic investing, let’s look at the fundamentals behind the book, let’s look what it brings to the table, let’s assess its long term viability as a collectible, let’s see if the market has it right. Such easy things to right down. So hard to put something like this into practice but that’s the point of this blog, this is relatively new ground for most of us, I’m sure some very savvy collectors and investors have been practicing for decades. I think its time we develop the skill set needed to make some smart choices.
So where do we start? How about some sort of checklist? Maybe it’s too simple and not nuanced enough but we have to learn to walk before we can run so maybe the fundamentals will help.
Many of these fundamentals have been repeatedly covered here on Comic Book Daily. The checklist should at least include, first appearances, first cover appearances, first artist work, historically significant comic and massive cover appeal for whatever reason comics. Each of these will have sub-sections like heroes, villains, love interests, aunts and uncles etc for first appearances. From here we should consider supply – scarcity, relative scarcity and scarcity of grade (go back to my scarcity of grade post for how to predict future scarcity levels of CGC graded books) and we should note current demand (remember soft demand could be good for us if many of the other items of the checklist are present). This is good enough to start, you can add a few more things that you believe in and start from there.
We now have our checklist. Next, we actually need to do work, to study, to go through data and try to see patterns, spot trends and start using this data to start targeting books that are emerging as potential books of interest. Let’s take some notes, open a spreadsheet and start recording sales values. The best thing that can happen to us is that we end up spotting a book or two that we zeroed in on and that book ends up increasing in value, even if its before we had a chance to buy it. Success! we are on our way.
This was a simple and rushed overview I know but I wanted to get the ball rolling, next week I’m going to share with you an example of how some research and some connecting the dots can lead to great investment opportunities in comics.