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Tuesday, April 15, 2014

Investing In Comics Buying Strategies Part 4




I'm gonna veer off course a little and answer a super great question from the comment section to the previous Part 3 post. The topic is too long to reply to in the comment section, so I figured I'd dedicate an entire article to it. If you missed Part 3 or want to read the comment, just click this Part 3 link to check it out. Actually, if you just stumbled upon Part 4, it's probably best you start at the beginning with Part 1 so you know what I'm talking about.

My Long-term vs. Short-Term Strategy

Should you hold onto that comic or should you let it go? What to stash as long-term investments and when to sell? These are tough decisions that I often wrestle with sometimes myself. There really is no easy answer, but I can tell you what I do and why. You may not agree and that's perfectly fine as well.

I basically have three kinds of comics in my collection, and I'll describe and outline each category I put them into.

1. Profit Comics

These are the comics I already made profits from or have exceeded the value for the price I purchased them for. These are also comics I could sell now and still make a nice profit (not a big one though) minus all the fees and such.  

Giant Size X-Men #1 is one of them. Marvel Premiere #15 is another, as well as Tales of Suspense #52 and Amazing Spider-Man #6 and #300 just to name a few.

But just because I've made a profit on them already as investments doesn't mean I want to sell them. This all depends on how much I really want to get back from them as investments.

To be honest, my Tales of Suspense #52 is suspect. It's really the only one I debate about letting go or not. It's only a CGC 5.5 FN-, but has it really made enough of a return for me to let go? 

So I got it for $75 and 6.0s are dropping for around $250/$260. I'll say I can sell a 5.5 around $200. It's only made $125 in return for me. Chump change, but then again, I've only had it for around 2 years.

If I sell it on eBay, I also gotta pay the 10% final value fee, plus the Pay Pal fees of 2.9% (I have a merchant account) + .30 cents per transaction. So the eBay final value fee will be what it sold for plus what I charge for shipping. I'll leave shipping out to make it easier and just say it's $20 bucks. Then the Pay Pal fee for just the comic will be $5.80 plus .30, and that's $6.10. 

My profit would be  around $98.90. That return isn't to my liking just yet, and there are a few things that make me want to keep it a bit longer and let it age.

For one, once I sell that puppy, it becomes part of my income and Uncle Sam wants his cut. So in reality, that $98.90 return would be squashed down even more.

Two, once I let it go, it's gone. I can never get it back. I don't mean the actual Tales of Suspense #52 key issue I can't get back. I can always reinvest in a higher grade one.

What I mean is that I can never get how much I got it for and the particular time I got my copy back, which was before the comic blew up and before the Black Widow ever hit the big screen. I'd have to pay top dollar to reinvest in a higher grade copy, and it's just not an issue I want to spend that kind of money on right now. There are bigger fish to snag.

It's not a super low grade comic, and I do not have a higher graded copy. So I'll let it age for the meanwhile.

I plan on holding onto my most of key issue comics for thirty years or so as investments. I don't really deviate from this, especially for super keys like first appearance of Punisher or Wolverine, etc.

My early Amazing Spider-Man key issues I plan on holding for at least 30 years. However, if my Amazing Spider-Man #300 doesn't come back at least a CGC 9.2, I will sell it and use the money to reinvest in a higher graded 9.6 or 9.8 copy. I'm not saddle with a 9.0 or lower ASM #300, and I'll probably gamble and try to hunt down an unslabbed copy within that grade range.


2. Marinating Comics 

These are comics I purchased for market value that have not gone up in value at the grades I got them for. Most recent example is the Amazing Spider-Man #162 I just got. That sucker is marinating and will probably marinate for a while. 

These are comics I bought as investments and can be comics that I've recently purchased or over-payed. The Star Wars #1 CGC 9.4 comic I got last year was an investment comic I over-payed for and have admitted to doing so in The Vault. Yes, I still do make mistakes, and that one is marinating as well. 

Even the Incredible Hulk #181 I got is marinating, but that super key is in the for the long haul. No doubt that's a keeper and one of the best bronze age comics to invest in hands down. 


3. Junk

Now there's a thin line between Marinating Comics and Junk Comics, because what was junk yesterday just might have a sudden surge in demand, usually because a character is announced to appear in a comic movie.

But sometimes junk is still just junk. X-Men #4, first Omega Red, is still a junk comic in grades lower than CGC 9.8. The ones that I had in my collection were probably no higher than a 9.4 and those still aren't worth much. CGC a 9.4 X-Men #4 from the 2nd series now, sell it on eBay, and you'll lose money from CGCing it. Then again, the character has not been confirmed for a movie yet, so we'll have to see, but it is no ASM #300 or New Mutants #98. Those two comics are still valuable and in demand even at mid grades.

Most of the comics that I obtained as a kid are still junk comics, despite if so and so is gonna be in a movie or not. They were well read and no where in the 9.8 range and mostly all are Copper and Modern Age books. The copies I kept as a kid are not great comics as investments.

However, here's where the line is convoluted. So I had a VG, unslabbed Amazing Spider-Man #300. It was an extra copy, but all the sudden a huge spike in demand for that issue happened about last year. 

I didn't really want a VG copy for that issue any longer. So when that sudden spike in demand hit, I put it up for auction and it sold well over guide, amazingly.


Another example is an unslabbed Amazing Spider-Man #41 I acquired, once again, from a comic lot purchase. It was in VG condition as well, and I put it in my collection and realized I already had a copy. Oops. I did get the comic lot one for way under guide also, but the market at the time of purchase wasn't selling all that great.

When all the sudden it was announced Rhino would be in the Amazing Spider-Man sequel, I let that VG copy I got from the comic lot go and sold it for $70 something bucks. This is technically not a junk issue, but I did let it marinate until it was the right time to let go.

An Uncanny X-Men #282 I just found in my collection Friday is pure junk, and of course it was in my junk box. It looks like someone pissed on it and let it dry. 

What do I do with that comic? I have no idea. Even though the first appearance of Bishop is hot, VGs are still selling for dirt prices. I doubt that issue in VG will ever be valuable in my lifetime. I'll probably try to sell it at a comic convention for junk cheap prices. At that grade for the comic era it came out in, it's definitely not one of the best comics to invest in, but it was from a huge X-Men Comic Lot Snag

I got a lot of good X-Men comics out of that lot of 200, including an extra copy of X-Men #141 and a copy of #142. Of course, I kept the #142, which is VF or a little higher, and let my extra copy (the lowest grade of the two) of #141 go when demand for that issue was hot due to the movie based on the story line.




So basically, I have no problem getting rid of Junk Comics to fund more investment comics. This even includes low grade silver age or bronze age common issues or extra copies of a key issue I scrooged up at a sale or acquired in a comic lot. 

If it's a silver age comic but really looks good, I'll keep it and put it on my list to CGC. Best example I can think of is Captain Marvel #3, which was acquired in a comic lot. 

Minor key issues like Tales of Suspense #75, first Sharon Carter and Batroc, depends on the condition. If I get it graded and it comes back an 8.0. I'll probably keep it as an investment. If it's a 6.0 FN, I'll let it marinate until it's worth selling and getting a nice enough profit back if the market isn't so good for that book at that grade currently. If it comes back a VG or GD or restored, I'll dump it. I hate losing money in comics, but a minor key issue at those low grades would take a long, long time to have it valuable enough to make any decent profit off of. For that, I'd rather sell that issue and a bunch of other unslabbed minor key issues in low grades to help fund an investment comic that's more of a sure bet like an Avengers #4 or something.

I'm pretty reluctant to let most silver age comics go unless it's a low grade common issue, a less important low grade key issue (Minor Key), or I have extra copies. Major key issues or early issues within the Amazing Spider-Man or X-Men volume one series stay in my vault. No exceptions. Unless, of course, I plan to upgrade a certain issue, or I have or obtained extra copies cheap through comic lots or sales.

If I have doubles of a key issue like the first appearance of Rhino, I'll get rid of the lowest grade copy. If they're both low grade VGs, I'll get rid of the one I got cheaper and let the other one age even more. Once again, I hate losing money in comics.

If I have a low grade CGC copy and an unslabbed extra copy that looks nicer, I'll submit the unslabbed copy and see if it comes back a higher grade than my slabbed copy. You can guess which one I'll then dump, depending on what it is of course. If the comics are Golden Age Batman #1, I'm keeping both.

When did I let that extra copy of Amazing Spider-Man #41 go? About three weeks after confirmation of the Rhino in the movie. I suggest waiting at least a month or three to sell any unwanted comic after confirmation of a character making their first onscreen debut to let the heat build up.

In all honesty, my short-game investing is pretty thin. I don't invest in comics short-term. I rid of stuff that I don't want or that has very, very little potential as investments. Usually, I get those in comic lots or I've scrooged them up at a sale.

I usually don't like reinvesting my investment comics if I don't have extra copies of them, because then I have to wait even longer for that key issue I re-bought to produce a return. Sure, you can look at it this way: I sold a major key issue at $400 dollars to get a $2000 major key issue book, so I got it for $1600. 

I don't see it that way, though. I see that $400 as still my money. If I made $300 return from that $400 comic I purchased for a $100 way back when, that's still $400 dollars of my money I dumped in to buy that $2000 book, so I still basically bought that book for $2000. I start at 0 again in terms of profit return and investment timeline the moment I purchased the higher ticket book. Though, there's no doubt that higher ticket book will be a good investment in the long run.

On the other hand, let's say I had two copies of Justice League of America #1. One was a CGC GD and the other a CGC 4.0. Would I trade the CGC GD Justice League of America #1 copy for another major silver age key issue or bronze age key issue equal in value? Sure, I would. That's a different story. I'm trading one investment for another equal one in value, not selling and entirely losing a key issue comic investment.  

Once again, it boils down to your philosophy and what you feel comfortable doing. My personal strategy is not set in stone, nor is it law of the land. Just how I view things. 

If you feel like you've made enough profit off a certain comic and it's time to cash out, do so. But once a major key issue comic blows up, it's extremely hard to ever get it cheap again.

Make sure you won't regret it. The previous owner of Comic Ink had an Avengers #1 (yes the silver age one) at a CGC 9.6. Due to financial trouble he sold it years ago, long before rumblings of a movie ever surfaced, for $30,000. He always regretted it, even before the movie came out and even before a CGC 9.6 Avengers #1 broke sales records in 2011 and sold for $250,000! 

$30,000? $250,000? I'm sure I know which one you'd rather have.

Alright, Part 5 is ready so just click the blue link below to carry on reading. If you missed Part 3, just click the PREVIOUS link below to see what that's all about. 

Thanks, Loren for the question and commenting. I hope the ramblings here helped you and the rest out there some.



 



2 comments:

  1. Man, this is Awesome! I really get a sense for your hold/sell philosophy. You had me cracking up with the "looks like someone pissed on it and let it dry" comment. My brother and I refer to low grades as "toilet paper" and low value comics we sell at shows as "fodder" or "chum". ; )
    Man I would have been bumming if I had sold my 9.6 Avengers 1 for a lower amount and realized later, it's full potential. But if he only spent 12 cents on it....still a HUGE return! I'm grabbing a bite to eat and then will be diving into part 5......ROCK ON!!!!! lk

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    1. I'm a huge Jaws fan, so I like that term "chum" for low value comics. I think I might have to adopt that term if you don't mind LK. I like it a lot.

      You're right, he did get a nice return, but he sure didn't buy it for 12 cents. He bought it for top dollar at a comic convention a long time ago, probably during the late 80s. Still, a nice return either way you slice it.

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