Go into debt for buying Magic cards, should I do it?

[sQri]

Hi,

I was recently told by a friend, that one of his friend plans to sell his huuuge Magic the Gathering collection (with Power 9 and all Duals, if you now what I mean).
I have a lot of experience in buying/selling Magic cards, so that is nothing new for me.

The guy wants around 16k Euro, whereas the collection is worth around than 20k.
Obviously, I have to assure myself, that the prices and cards are ok.

Now the problem is, that I only have saved up around 5k, so I need at least 10k, which I can ask my parents for, but have inhibitions.

For the decision, I thought to myself:

• Whats the best that could happen: I sell the cards for more than the 20k, sell them quickly and make some easy money
  
• What the worst that could happen: I sell the cards for way less than the 16k, it take years to sell them, am in debt to my parents for a long time
• Normally, it takes a while to sell all the cards and I can pay my debt of regularly.

I know, in the end, it is my decision, but I like to hear your opinions.

Thanks a lot.

 

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[theag]

Sounds pretty stupid to me.

When I read the thread title I hoped this was a joke.

 

[sQri]

Sounds pretty stupid to me.

When I read the thread title I hoped this was a joke.

Do you care to elaborate why?

 

[theag]

Do you care to elaborate why?

High risk, low ROI. Not worth it.

And magic cards in general.

 

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[Guest34764]

Sounds a bit to risky.I used to play a bit of Magic but i've never seen people who would pay that much for them in that big of a bulk.IMO i wouldn't do it.

 

[Fox]

Be a broker and ask for a 5% fee or half of everything over 16k. No need to borrow money on top of the high risk.

 

[Delmania]

I'd agree with @Fox. At the very least, don't buy them unless you have someone lined up to buy them from you.

 

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[RazorCut]

High risk, low ROI. Not worth it.

If you KNOW you can get AT LEAST 20k for them within 6 months tops then I would offer 4k and leave it at that. No negotiation, just a one time offer. Take it or leave it.

Better yet forget it and use the 5k you have to build something sustainable and worthwhile.

 

[ZCP]

Why aren't you selling them now and confirming market instead of posting whether you should do it or not? Sales orders solve everything.

This is the same as any business deal...... Does it solve a need? Is there market? What is the payback? What is the ROR? What is the risk? Is there any easy way to make each of those better?

 

[healthstatus]

Do you care to elaborate why?

Total lack of control.
If Magic changes their rule set, floods the market, goes digital, or another wildly successful game erodes the market share, the value of the cards can go to cents on the dollar in a hurry.

 

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[ZCP]

Out of curiosity, I checked ebay...... can buy 6000+ card sets for 49.95.......

 

[sQri]

High risk, low ROI. Not worth it.

And magic cards in general.

Why a low ROI, if I'm right, it 25%, which is high, isn't it?
And why the disregard of Magic cards?

Total lack of control.
If Magic changes their rule set, floods the market, goes digital, or another wildly successful game erodes the market share, the value of the cards can go to cents on the dollar in a hurry.

Sure, this may happen, but it is very unlikely. Do you know anything about Magic?

Out of curiosity, I checked ebay...... can buy 6000+ card sets for 49.95.......

Thank you, but it looks, that you don't know anything about Magic

I was talking about cards like this:

http://www.ebay.com/itm/Black-Lotus-Unlimited-Magic-the-Gathering-/301743271235?hash=item46414ced43
http://www.ebay.com/itm/Ancestral-Recall-MP-HP-Unlimited-Mtg-Magic-/272000652641?hash=item3f54809561
http://www.ebay.com/itm/Unlimited-M...ic-Card-MTG-/291565369318?hash=item43e2a677e6

Cards, that costs 1k each, which should increase in value.

As you said, it is like any other business deal.

My main topic is, if it is a good idea to get a loan for this deal.

 

[jon.a]

Read this...
https://en.wikipedia.org/wiki/Tulip_mania

 

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[sQri]

Read this...
https://en.wikipedia.org/wiki/Tulip_mania

And the same question for you? Do you know Magic?
I guess not, since that Magic has nothing to do with a bubble.

 

[funkj25]

As others have said, don't unless you're lined up to liquidate them quickly.

I did play magic several years ago so I'm familiar and I also hustled buying selling collectibles for about 18 months. The MINIMUM I would want to get is 50% value so in this case 10k. But typically the larger collection of stuff I bought at a time the more I would want to stretch that margin to reduce my risk so in this case I would personally not offer anything over say 8k on a few conditions.

1. You're already familiar with the business of selling magic cards and really understand your turnaround time/shelf life/how long you'll sit on them before they sell.

2. I could get rid of them in 30-40 days MAX. 14 days would be preferable, but for the value of your return, a month would be acceptable to me personally.

3. The 20k valuation is based on the lowest recent sold for prices you can find (use eBay as a guide) not median or high valuation prices.

The longer you have to sit on something the less you'll pay for it. If I knew I was going to sit on that collection 6 months I'd lower my offer even more down to the 5-6k range depending on some of the factors listed above.

The thing everyone is dancing around here and hasn't said outright is that you have to be product agnostic. Yes you're familiar with magic cards, but if you can put your money to a better use making 100% return on it for example (see the various hustle threads by grumpy cat) you're much much better off.

In short, it's probably a bet you'll regret making.

 

[Boozoon]

Well I would definitely take a look at the current meta of the tournaments and try to guesstimate whether the cards sold are going to have value or not. It has been years since I played Magic but I think that you should check who is your target market first. Are they players or collectors? Players will pay for cards that can help them win tournaments, so if the set that your friend is selling is full of shitty creatures and spells you should take that into consideration. Collectors are a bit trickier, they might not want the cards and you will end up selling each card separately.

But, I would not ask money from my parents. Seems too risky to me. Maybe purchase some cards that you believe are going to sell well in the following months.

 

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[theag]

25%, which is high, isn't it?

No thats not high ROI for this risk.

 

[Kak]

High risk, low ROI. Not worth it.

And magic cards in general.

And magic cards in general hahahahahaha

 

[PatricianCat]

If I asked my parents for 10k to buy Magic cards with the best case scenario being make abour 4-5k they would laugh at me.

If I went to the bank and asked the same question they would laugh at me.

I don't think this is easy money, as said before by others it is high risk. You have no control! I don't even think there is a need. And you are going to have to spend a lot of time hustling these cards AND having to pay your parents back.

Your own savings are better off going towards something sustainable, repeatable, and with the potential to scale.

 

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[Kak]

Be a broker and ask for a 5% fee or half of everything over 16k. No need to borrow money on top of the high risk.

Or get 100 percent of everything over it with a 3 way brokerage escrow.

But, I'm with theag... Magic cards? Seriously?

 

[funkj25]

Or get 100 percent of everything over it with a 3 way brokerage escrow.

But, I'm with theag... Magic cards? Seriously?

There is potential in collectibles, but yes CCGs in general are a tough market to hustle in without really knowing how to keep your own backside safe.

The problem with collectibles however is that you are competing against people who want them personally and are irrational on price at times so especially with a collection that size it's going to be tough to buy it for the right price.

I do like your guys' thoughts on a brokerage fee or setting up the 3 way escrow. I don't do that hustle anymore but that's definitely my golden nugget from the forum for the day. Sticking that in my mental toolbelt for a rainy day.

 

[PatricianCat]

The problem with collectibles however is that you are competing against people who want them personally and are irrational on price at times so especially with a collection that size it's going to be tough to buy it for the right price.

Not to mention it is going to be hard to get them for a better price from somebody that has poured 20k into the collection and is seemingly tired of the game and is trying to mitigate their loss.

 

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[Veloce Grey]

No thats not high ROI for this risk.

Do you know Magic? (I just couldn't resist)

If not please don't bring any of your scientific quackery or reasoning nonsense into this discussion.

 

[jon.a]

And the same question for you? Do you know Magic?
I guess not, since that Magic has nothing to do with a bubble.

Are you just going to keep arguing until someone tells you this is a great idea?

This is a great idea. A solid score. Bet the farm.

 

[The-J]

...seriously?

 

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[vinylawesome]

 

[Bouncing Soul]

Most of us are totally desensitized to the real risk borrowing creates, which is substantial. You need to get paid for that.

 

[DeletedUser394]

Please don't.

Such limited upside for such potential disaster.

 

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[JAJT]

I know magic cards.
I own magic cards.
One of my buddies opened up the best board game store in my city focusing heavily on magic cards.

I would still not take this deal.

You are going into debt on a $16k purchase for a max potential upside of $4k. That's retarded in my eyes.

If you had a business, were doing well, and had some "throw-around investment/hobby funds" - then yes, that makes a lot of sense. You enjoy it, could make a bit of scratch, it would be fun, and you'd have the money to lose. Sure. Go nuts.

But a $4k upside + debt + uncertainty = I wouldn't even consider it.

 

[Kak]

Although. We just told him how to go about this with zero risk and no finance charges.