The passion of investing in collectables

This article comes to us from Yahoo Australia. Most of the readers here are from the U.S. but the ideas presented are very relevant no matter where you live. 

The bottom hasn’t fallen out of the market for baggy green caps.

But they’re not fetching as much as in 2008, when the cap worn by Don Bradman during the 1948 Invincibles tour sold for $402,500.

Managing director of auction house Mossgreen, Charles Leski, said the owner of that baggy green may not make any money if he were to sell it today.

But the joy of owning it for the past six years should not be underestimated.

And that’s at the core of investing in collectables. There’s an emotional joy in owning something used by your sporting hero or something eminently rare and desirable.

A joy that than investing in cash, shares and property just can’t match.

That said, Mr Leski says there’s been a post global financial crisis slump in sports memorabilia prices.

The market for old and rare pieces is still strong – early Aussie rules Brownlow medals, premiership medals, cigarette and trade cards, postcards, publications by the clubs.

But they are, by nature, very rare.

However, the market for what Mr Leski calls “hero” or “iconic pieces” has sagged.

He includes in that category signed cricket bats, signed footy jumpers and baggy green caps.

“While they’re almost all selling, they’re selling at lower prices,” Mr Leski says.

He attributes much of this to a drop away in charity fundraisers – sportsmen’s dinners and the like.

Then there’s the issue of overkill – access to more sports memorabilia globally than ever before.

“If you want to buy a Manchester United product, you can buy it in Australia, you can buy it anywhere,” he says. “I think the problem is that it has been too successful.

“There is just too much material washing around in the marketplace.”

So now we know the lie of the land, let’s get in there and buy something we will be proud to own while, hopefully, getting a return on our investment.

Seek out collectables from an area you’re passionate about – don’t look for stamps if the Geelong Football Club is your raison d’etre.

With just a few thousand dollars you could be the proud owner of (and investor in) that football jumper worn by Geelong great Gary Ablett.

Compare this to the money needed to make a substantial investment in real estate or even shares.

Try and find pieces of Geelong football history; cigarette cards, trade cards, team sheets, books published by the club, photos, uniforms.

Mr Leski says the beauty of being a collector is you are your own “editor”.

“Nobody is going to tell you what to collect and what not to collect,” he says.

Likewise, nobody can guarantee that what you collect will appreciate in value.

You need to do your homework.

Search online for like-minded collectors, trawl eBay, go to the sports clubs themselves and visit auction houses, browse their catalogues and their webpages.

All through this, you are doing something that offers immense reward – you are pursuing your passion.

But there are traps for the unwary and uninformed.

“There are too many transactions done in the pub, too many people who buy something online or through a newspaper advertisement, thinking they’ve got something, then they discover it was too good to be true because they’re either naive or they think they’re smarter than the other bloke,” Mr Leski says.

“This is an environment in which information is readily available, and anybody who doesn’t take advantage of the tremendous research opportunities that are available before making a significant purchase is a bit crazy.”

So what’s hot?

Mossgreen recently put about $800,000 in early Australian stamps under the hammer, with a clearance rate of about 93 per cent – a tremendous result.

Mr Leski says classic Australian art is strong.

But he also says just about any good material in top condition will sell.

Mossgreen has free valuation days every Wednesday where, Mr Leski says, pretty well every week something exciting turns up.

“Nine out of 10 people know before we’ve told them that what they’ve brought in isn’t very good, but occasionally we find something that they didn’t think was good and they’ve missed the point completely and that’s wonderful,” he says.

“We’re in the business of trying to give people good news and we love it when we find something that comes as a pleasant surprise.”

Mossgreen’s fee is typically 15 per cent of the sale price.

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