My thoughts on Magic: the Gathering as an "investment"

I was playing EDH on my local LGS the other day and some folks I have never seen before came for a Dominaria Remastered draft. I have never played draft before, but I played sealed a couple of times. Soon I realized that those guys considered themselves, as I heard due to conversations I wasn’t invited for, “high rollers”. The “big boys”. The “I could buy a car with the cards in my binder”. I’m always buying random stuff from other people’s binders, so I got a Jester’s Cap from one of those guys. I did not get the chance to buy Dominaria Remastered packs yet, since I’m mostly buying singles, but I like to support my local LGS the way I can, so I buy packs sometimes.

They are usually disappointing, not gonna lie.

Still, not why I'm writing on Medium, let me keep writing about what happened that night.

But by the end of the draft, I overheard a conversation again. Basically some older dude selling what would be around 500 USD in singles that recently came out of a booster pack. I mean, I understand people buying cards over the time and eventually getting big and valuable collections, but I soon realized that the guys selling expensive cards was mostly selling just foil full art cards. For a second I wondered, “why would you burn you hard earned money on that?”. I have always been the kind of person who is okay with “Asphalt Played” cards If it comes with a big discount ("Asphalt Played (AP)" is what I would call a “meme” card condition, It’s when It looks like someone rubbed a MTG card on concrete, it’s a special kind of damaged card).

Maybe my views on money are twisted, since I’ve been called a cheapskate before. But I have always seen as a life goal the idea of getting “x” amount of money for a job and then living with less than “x”, so my money could go into an ETF for long-term investments. Moments like that 500 USD transaction on single MTG cards always makes me think of cards as investments. Will I ever get my money back? Will my Mana Vault go up in value?

And maybe as a Brazilian I would have something more to add to this conversation.

I know of guys who buy sealed boxes and sell them over the years for a profit, and It makes sense. I don’t think that’s a huge deal here in Brazil, but sure enough I have seen huge collections on cards that are considered to hold their value over time (Reserved List Cards and Staples).

The thing that I would like to point out is how buying an MTG card in English using local Brazilian currency might be viewed as a "protective asset", as It kind of is a American dollar-backed collectible product and not a goddamn stock. Putting this into a Medium article brings something new to the mentality behind buying and selling cards, and one’s approach to It. I have seen multiple videos on YouTube of Americans analyzing a card’s value on TCG Player like they are talking of some kind of stock, and I’m not exactly comfortable with that. I’m never going to justify “MTG day trading” because of how unpredictable the market is, for the lack of real historic data on cards when compared to ETFs and "classic investments". Yes, I’m going to compare a piece of cardboard to an ETF because that’s how some people look at It.

When talking about my own experience, I have always imagined that one day, I could sell my card (that I got in Brazil with my local currency) on Ebay or a local LGS in the USA for USD, a respected global asset.

I know, I know, America is going through a period of high inflation rates and a possible change in the global economic order, as China grows bigger and scarier every day. But oh boy, I grew up in Brazil, I was born in inflation and untrustworthy governments. The way I see It, the US dollar sure is an upgrade. The value of a card is reflected by its supply, and fiat currency over-liquidity is a complex problem today. From time to time I come across questions related to this, how to keep your money’s worth?

Let me give you guys an example: a MTG player may easily buy in Brazil a Mana Crypt for 550 BRL, that’s around 105,84 USD. I would say that this price perfectly reflects the purchasing power of the average Brazilian player. At the same time, a Mana Crypt goes for 200 USD in Card Kingdom as I’m writing this. My point is, there is the possibility of maintaining value between these different currencies, or even reselling abroad to increase my purchasing power, given that I earn my salary in BRL. I can’t say the same if I’m buying cards in Portuguese, as an international player might not want to buy my card. Or if I’m comparing how a card holds value when compared to a boardgame like Catan. If you have a card in NM condition, if it is double sleeved, the tendency is for the card to hold It’s NM condition. A boardgame is too big and unconventional to store. As new editions of the same boardgame come out, the old ones are usually lose value in the secondary market. The same does not occur in the same intensity between Magic cards of different editions.

By the end of the day, what I’m trying to say that I see my classic commander staples and more expensive lands as inflationary assets more than stocks that could be traded or analyzed objectively. I don’t have much reason to believe that the Brazilian real will prosper in the medium term, when the subject is its parity with the international market. In other words, my purchasing power in an international context. This is very relevant if you stop to think about how Brazil supplies itself, how the dollar affects imports, etc.

Using my Brazilian Reais to buy US Dollars is a way of protection for a lot of us. My staples will probably hold value, not sure about making a huge margin profit, but cards are still getting more and more expensive as supply and demand does It’s thing. It’s not really like buying gold as a way of protecting yourself from inflation or something like that. The key difference between Hasbro’s colored cardboard and literal gold should be obvious, but let me say It: gold has consistent historic data on it’s value to back It up. Buying cards may not be a bad idea given all the things I just said, but It's no consistent reliable approach.

Still, just try to differentiate the idea of buying an expensive MTG card and the idea of justifying an expensive hobby. Some folks buy expensive shoes, expensive cars, expensive ___ (fill in the blank) to resell It or keep It to themselves as “protection”, since you “can sell when needed”. But like, If you don’t really like Yeezys, why would you buy one? Just because It’s expensive and has a limited supply, it’s not automatically an investment. One is able to buy a Yeezys and use It as a regular shoe, and then sell when needed, but doesn’t that sound like “yo, you should buy that Cyclonic Rift, just sell It when you need the money”.

Would you recommend buying MTG cards as an investment to someone who does not play MTG?

Yep, that’s what I thought.

If you are still investing on single cards, stick yourself to staples and the reserved list. And remember, time in the market is better than timing the market. Personally, I’ll just keep buying the cards I intend to use, and I don’t see them as a complete waste of money. It’s kind of just that, douldn’t think of spending my money on foil and borderless cards.