Why Sportscards do better during
recession years than boom years. 
During
these unstable economic times people have been pulling their money out of investments and
converting them to cash. While Canada's banks have recently been declared the
best structured and sound in the world, even more highly regarded than Switzerland's,
Canada's economy is largely linked to the demand for resources. In particular oil, natural
gas, gold, coal, metal and softwood. This has caused the value of the Canadian
dollar to fall recently in tandem with the fall in the price of oil. Demand for
metal and wood are falling as home construction and funding for major projects around the
world are being put on hold. But overall Canada is being less effected than many of
the industrialized nations, and shouldn't have to run federal deficits.
When people take their money
out of stock investments or real estate, often coins, antiques, and movie and sports
memorabilia is where much of it goes. When it comes to considering sportscards
as an investment, the best thing to do is to examine the history of how things like
sportscards have done in the past. Collectibles, especially coins, remain extremely
liquid.
If you had invested in
baseball cards for example at the end of the 1970's, and sold them all at the end of the
1980's - nothing would have given you a greater return on your money. That's right,
nothing. Not even real-estate. Rare coin prices actually rose during the
great depression of the 1930's, and they rose again during the recession and oil crisis of
the mid to late 70's. They nearly doubled in value during the two years that
followed the stock market shock of 1987. (source: PCGS 3000 Index)
Collectibles markets are often
counter-cyclical to widespread turmoil, meaning owners can actually profit when they need
money the most. At worst, these categories are generally only minimally affected, in the
short-term, by Wall Street's wild fluctuations. Coins and collectibles have a steady
record of bouncing back even if their value takes a hit.
Investing in sports cards is a
hedge against inflation, and another way to diversify your money. In 1984 a 1951
Bowman Mickey Mantle rookie card sold for $300. Today it sells for
$8000. Bobby Orr Rookie Cards and Wayne Gretzky rookie cards tell the same
story. Once valued at $20-$50, these cards now command thousands.
How to buy:
Buy rookies.
Rookie cards are always the highest in demand of that player's cards and will appreciate
in value the fastest.
Buy vintage. Now,
this is defined by anything before 1990. Vintage rarely drops in value because a
player's career is complete and the value of the cards is not affected by the ups and
downs of an active career.
Buying graded.
Grading is the only way to buy rare notable rookie cards. We here at Canadian Hockey
Cards only like to deal in graded cards when dealing with a rookie card of a player like
Wayne Gretzky. It is also a protection against counterfeit cards. The only
grading companies we would consider as top level would be PSA, Beckett (BGS or BVG), and
SCG. Cards in grade 8 or higher condition continue to break new records in sales.
Card condition:
Centering is the most obvious flaw. Make sure the border is even on both sides and
on top and bottom. Beware of a card that may have a grade of PSA 8 or PSA 9, but
has an (OC) under the grade. This means the card is off-centre, and is worth less
than half of what it would be if it was centered. The next priority is the
sharpness of the corners. Without sharp corners, a card would have a tough time
grading higher than 5 on a scale of 10.
Creases will bring down the value of a card faster than anything.
It is like an instant 70% reduction in the value of a card. Creases cannot
always be seen in a scan of a card. They sometimes need to be turned to an angle and
seen in good light to spot a crease. A crease will give a card a grading no higher
than 3 out of 10.
