I must have been writing my answer while you were typing this up. Keep in mind leveraging from investors only works if the investors share your vision and see money to be made. I’m sure this has happened already in Pokémon where some investors buy into very high end items, but it seems more likely to have happened in other collectibles where the risk is lower due to a more proven market (sports cards).
Leveraging for a business is also different as you’re getting your return through actual income. The reality with speculative investments like Pokémon is you don’t see a return till the card is sold. I doubt you can even leverage with the card like you can with a car/house, due to Pokémon cards not being a recognized asset, if anyone know a bank that will accept Pokémon cards as equity let me know.
So, while your analogies are good, they’re not quite apples to apples. Not that I’m disagreeing, but I like playing devil’s advocate every now and again.
Plenty of people keep details on their purchases and track how they’re doing, even if they were intended to keep not as investments; I’m sure you can find someone who would share.
And OF COURSE if we changed the commodity the answers would be different! But a car or a blue chip stock or index fund is not a Pokemon card. Imagine borrowing 10k to buy bitcoin. People would tell you hell no too risky. Let’s say blue chip stock (not even FAANG tech stuff here, I’m talking Coca-Cola, Unilever, Johnson & Johnson) has a risk factor of 1/10 and bitcoin or cryptocurrency is 10/10. Pokemon is probably like a 6/10…
The answers in this thread are perfect to accompany “Will a recession cause a dip in Pokemon prices?” It’s making me think the BEST use of $10k is to wait until a recession and then buy for cheap the cards I need that overleveraged people will be forced to liquidate asap.
Thank you to all who gave their personal opinions in a positive outlook. A lot of this information has been helpful and has given me a different perspective on the matter now. This is one of the big reasons why I joined this forum, I had always heard this community was strong and supportive which has been proven here
late jump in. the point OP has is a pretty valid scenario which does not have a clear black or white answer.
he/she is trying to buy an item that might not appear often, and its price point can change a lot.
he/she can borrow money for a decent interest rate, which he/she is confident they can pay back in time.
looking back on the last 6-9 months, you see booster box prices jump 50-100%. in this specific case, that credit card loan scenario is a smart thing, and one of the reasons why OP is even considering this. the market is always in flux.
however, if your financial standing is not great, then there is a big risk in undertaking this. however, with booster boxes, prices tend to stay the same or increase, rather than drop, so the loss could be minimal. you generally think worse case scenario.
if this were an investment question, obviously, it’ll be very different. generally, borrowing money to do something is not automatically stupid. tons of people do it. that’s the beauty of banking and finance. a promise and some fancy theory will build an entire global economy.
I’ve used zero interest credit cards pretty effectively in this hobby. However, I have a descent income so I could recover from a drop in product value. I like to view them as a form of leverage.
This is one of the things that is completely dependent on the persons situation. It a can be a very high risk/high reward operation. Especially if you buy the wrong items with it.
Debt can be a very good thing depending on personal circumstances, what you use it for, and the interest rate. I know people making seven figures a year who still have outstanding student loans in their late 30s because they managed to get such absurdly low interest rates that they’re better off not paying those off and investing the money. Of course, it is also necessary to be able to take short-term hits by having adequate funds or income elsewhere.
Americans love debt. It’s what got us to #1 because you do something so ridiculous and convoluted, most people won’t bother to understand it. that’s when Americans get you.
@shizzlemetimbers, There have been many times I ‘yolod’ and won massively. Example: Bought a 1st ed neo genesis box for 750 in 2015 and it was purely because a seller accepted an offer I had forgot about, now 5 years later the box has 10x its value. I agree that you should have good financial knowledge/standing when making these moves and understanding the market plus having experience gives you a great shot at making a good investment. There’s always the possibility of losing but you need to be ok with that.
This comes down the the ability of being able to critically think and see patterns.
If you see something that breaks the pattern, and you work out the math that it makes sense, do it.
Those that don’t never will, they’ll simply call your successes “luck” because they lacked the foresight to act on the same information available to them.
