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Sports cards continue to make international news. For example, the 2018 NBA Logoman Luka Doncic rookie card recently sold for 4.6 million dollars. Also, consider a 1989 Ken Griffey Jr. Upper Deck rookie card. In July of 2017, the value was $400. The same card recently sold for $3,725 (both being PSA 10 grades/PSACards).
It’s little wonder they’re seen as ideal investment pieces, especially as the market itself has been on an upswing over the past five years in particular during the COVID pandemic.
So much so many sharps are adding sports cards as alternative investments to the stock market, gold, and real estate.
IMPORTANT: In essence, there are three main aspects to consider when allocating your sports card portfolio: time horizon, risk tolerance, diversification.
For some, sports cards are a kid’s hobby with little value in the real world. But sports card sharps know the truth in regards to the enormous returns certain sports cards can provide.
For them, it’s about maximizing profit, so a diversified, data-driven allocation approach should see the best returns in the long run.
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Here is everything you could possibly need to know about sports card investing, specifically focusing on creating card investing allocation models to maximize returns.
One last item, in MOST cases, we do not recommend purchasing raw cards (i.e., non-graded cards) for your investment portfolio as the risk is too significant. Too often they grade poorly.
Email us at email@example.com if you would like to know why we stated MOST cases.
Sports Card Portfolio Allocation
Below are the three main aspects you must follow when creating a sports card portfolio that will maximize returns.
Younger investors can allocate more risk to their sports card investment portfolio vs. older ones.
For example, a 26-year-old can afford more risk in their portfolio when compared to a 68-year-old investor.
This comes down to knowing yourself. If you can’t stand to lose and react poorly, lower-risk cards are a better option.
If, by nature, your more calm and easy going you may want to allocate more risk.
Put simply, diversification is the act of varying your range of investments to avoid potential pitfalls.
Rather than dumping all of your money into one specific player or card, you’ll be spreading it across a number of different markets within the hobby.
You basically have 3 classes of diversification. One, Hall of Famers/Hall of Famers active players. Two, Hall of Fame Trending. Three, top-ranked rookies and prospects.
HoF/HoF Active: Low Risk | Moderately High Returns – Examples: Babe Ruth, Wayne Gretzky, Mike Trout – Generally, hold up well in times of economic downturns.
HoF Trending: Moderate Risk | High Returns – Examples: Luka Doncic, Ronald Acuna Jr., Sidney Crosby – Generally, don’t hold up as well in times of economic downturns.
Rookies/Prospects: High Risk | Ultra High Returns – Examples: Wander Franco, Trevor Lawrence, Jasson Dominguez – Generally, incur heavy losses in times of economic downturns.
PLEASE NOTE: Generally speaking, you should be investing in graded only cards. We recommend PSA 10, PSA 9, BGS 9.5, SGC 10, or HGA 10. We lean heavily towards PSA 10 as they provide the best ROI moving forward. One exception in regards to our investment-grade recommendations is rare, older, high-value sports cards. For example, a Ty Cobb Red Back with a PSA 5 grade or a 1979 Wayne Gretzky O-Pee-Chee rookie card PSA 7 grade would be suitable investments.
If you have questions about what grades are acceptable for what cards, email us at firstname.lastname@example.org, and we will assist. Also, for this guide, we have left out BGS 10 Black Labels as they are rare and difficult to compare in terms of ROI.
Optimal Sports Card Portfolio Allocation
Here we bring it all together to create our sports card investing portfolio.
Remember, if you’re younger, consider more risk while older investors trend toward less risk.
Ultra Conservative: 90% HoF/HoF Active | 10% HoF Potential | 0% Rookies/Prospects
Conservative: 70% – 20% – 10%
Moderate: 60% – 30% – 10%
Agreesive: 60% – 20% – 20%
Ultra Agressive: 50% – 25% – 25%
Current Gold Card Auctions Allocation Model In Use: 60% – 20% – 20% (of course, this is our allocation, and you’ll be able to mix and match accordingly based on your tastes, as well as your budget.
It can be tempting to stack your portfolio with one specific player.
As we’ve noted above, RCs featuring the likes of Michael Jordan and Ken Griffey Jr. have risen rapidly in price over the past few years, and anyone who held onto a copy (or five) is likely to have seen a significant profit.
So, why not invest in a card like that as many times as possible?
HOF/HoF Active players don’t go up as much during economic upticks but don’t go down as much during economic downturns.
While rookie cards and prospects may sky-rocket in value during economic upticks but may crash in value during economic downturns.
An HoF Trending card is somewhere between the two.
Pro-Tip: Diversification will help to lower the overall risk during bad times and maximize gains during good times. It is a huge benefit if your main objective is to maximize your sports card investing portfolio ROI.
You’ll have to find the right formula for your appetite, as well as the players you’ve chosen to invest.
Number of cards in your Sports Card Portfolio? At a minimum at least have 10 and max out no higher than 100.
Below is an example of an ideal sports card investing portfolio using a 60%/20%/20% method with 10 cards in total.
- 60% – 1979 Wayne Gretzky Topps/OPC, 1933 Babe Ruth Goudey, 1996 Kobe Bryant Topps Chrome, 2000 Tom Brady Bowman Chrome, 1989 Ken Griffey Jr. Upper Deck, Ty Cobb T206
- 20% – 2018 Luka Doncic Prizm, Ronald Acuna Bowman Chrome
- 20% – 2019 Wander Franco Bowman Chrome, 2020 LaMelo Ball Prizm
The above portfolio contains ten cards in total, six of which are HoF/HoF Trending (60%), two are HoF Trending (20%), and two Rookie/Prospects (20%).
If you want a total of 20 cards in your ideal portfolio shown above then you would have 12 HoF/HoF Active (60%), 6 HoF Trending (20%), and 6 Rookie/Prospects (20%).
Start your sports card investing portfolio today: Check out the GOLD CARD AUCTIONS – BEST SPORTS CARDS TO INVEST IN page and select a few cards from that list. Your first few investments/purchases should be HoF or HoF active players.
Sports Card Grading
Whether it be PSA, SGC, BGS, or a new up-and-comer, grading is essential when looking at sports cards. Higher grades result in a higher ROI. One brand has more value than another.
As such, we would strongly recommend looking at high-grade options whenever possible since they tend to make the best investment pieces.
Also, PSA is the most valuable and will have a great ROI, followed by BGS, followed by SGC. PSA 10 is equalizing to a BGS 9.5, which is equivalent to an SGC 10.
Pro-Tip: Remember this when investing PSA 10 > BGS 9.5 > SGC 10
We (Gold Card Auctions) prefer PSA 10 in most cases if available but will also consider BGS 9.5 and SGC 10 in certain cases.
For a more detailed overview of grading, you can check out our in-depth guide; PSA Grading vs. Beckett Grading vs. SGC Grading.
When to Buy and Sell
Buy low, sell high.
It’s standard advice for anyone hoping to turn a profit in any market, and it can be that easy in practice.
Knowing exactly when to buy and sell cards is a separate matter entirely, and it only comes with experience, practice, and knowledge.
- Short-Term Investments: Popularity among the masses allows for a quick flip as you sell cards about a specific event. Examples include; injury bounce-back, new coach, trade to a new team, a prolonged slump that is not sustainable, injury plague – now healthy. Bottom Line: Risk Heavy, Not Suitable For Beginners/Long-Term Gains.
- Mid-term Investments: These could take a year or so to come to fruition. Still a good deal of risk. Examples: Investing in the league’s MVP/RoY favorite before the season begins. Risk Heavy, Not Suitable For Beginners/Long-Term Gains
- Long-Term Investments: The long-term investment is what we recommend and use. Ideal for the average investor. Hold these sports card investments for ten to twenty years or longer.
More experienced, veteran sports card investors can attempt short and mid-term investments as a smaller part of their purchases.
If questions in regards to any of the information above email us at email@example.com.
Where to Sell Sports Cards
Where to sell is another crucial aspect to consider.
Online auction sites like eBay are always popular, while you can always go to a trade fair or collectors event.
For more information, check out; Where/When to Sell Your Sports Cards (Best Card Sellers Guide).
Sunday, Tuesday, and Thursday nights at 9 pm CT tend to be favored when looking to maximize the audience size and obtain the greatest sale amount.
Sports Cards Portfolio Tracking
Tracking your sports card investments will take little time and effort if done correctly.
We’d recommend jotting down the following information if you’re keeping tabs on your ROI in regards to your sports cards investments:
- Purchase date – day, month, year of purchase dd/mm/yyyy format
- Card info – Player name, card number, parallel, auto
- Purchase price – how much was paid, including the shipping cost
- Sell price – how much the card sold for (include shipping cost and any auction fees)
- ROI – The return on investment (plus or minus)
A program like Excel will do the job, while there’s nothing wrong with a good old-fashioned pen and paper.
Whatever method you choose, make sure to be consistent and honest regarding the data you collect.
- Excel Spreadsheet (Free)
- Pen and Paper (Free)
- Card Hedger (online/our pick) You can read our Card Hedger Review Here
- www.cardladder.com (online/not free)
It’s tempting to look at the hottest cards right now when looking for potential investment pieces.
After all, if they’re turning a profit today, they’re likely to do so in the future.
But that has been proven not to be the best strategy to maximize your sports card investing ROI.
Follow our long-term investment advice in order to obtain maximum returns.
Any questions about purchasing cards for your portfolio, allocation, or anything else discussed in this write up please email firstname.lastname@example.org.
Welcome to the underrated world of sports card investing, and if you have any questions, contact us at email@example.com or visit the Gold Card Auctions Contact Page for more options.
Are sports cards a good investment?
Sports cards are not a good investment, they are a great investment. Please note however 99% of cards are not worth investing in. Visit GoldCardAuctions.com for top-rated investment advice.
How do I start investing in sports cards?
Start investing in sports card by reading https://goldcardauctions.com/how-to-invest-in-sports-cards/ and email firstname.lastname@example.org if investing advice is required.
Can you buy stock in sports cards?
You can't purchase stock in sports cards in the traditional sense but one can invest in Topps stock via SPAC Mudrick Capital (Nasdaq: MUDS).
Why are people investing in sports cards?
People are investing in sports cards due to incredibly high returns in the hobby over the last five years. Sports cards are also being used as a legitimate alternative investment to hedge against stocks and bonds.