In lieu of Russell Tassicker's weekly column, which has been postponed due to illness, Dave Heilker of 02drop.com brings us a fantastic piece of financial writing that'll surely be required reading for everyone new to this site!  Let Dave know in the comments below how you liked his first piece on DS! [KBR]

I’m Dave Heilker, "Dave Rockstar" to the great majority of people who know me, and I run the site 02drop.com.  Before we start talking about the meat of how to create your portfolio, here are some things you're going to need.

1. A Bankroll - For this column, I’ll always assume you’ve started with $100.00, today, right now.
2. An unwavering faith in my advice - We’re assuming a $100 investment, if that’s not a number you’re comfortable with, use less, but if I tell you to buy something, buy it. If I tell you to sell it, sell it. I have not since my return to Magic spent a dollar that wasn’t earned via the sale of cards.
3. A credit card, or a paypal account - you'll be depositing about half of your bankroll into your PayPal account to conduct business online.
4. Geographic knowledge of where the local store with the best stock is located. Preferably they price only occasionally and use some archaic system, like print media. Advantages of a store like this are obvious, the distinct disadvantage is they usually don’t downward adjust their prices either (e.g. They are currently selling Lotus Vale for $15.00 each).
5. A dumping station - I also recommend you have access to an eBay account or a very up-to-date dealer who is usually in the market to buy hot cards for cash. It’s obviously no use to you if you can pick up cards for super good prices and then be stuck holding on to them when the bubble bursts. The best place for this sort of dumping is local tournaments.
6. A Twitter account. I’ll put a list of people you must follow at the end of this article. You don’t need to know how to use all the lingo etc of the twitterverse, but you need to know how to read. Knowledge is power, and more knowledge is more power (with apologies to Tim Allen).
7. A sense of “self” – You’re going to need to embrace your personal quest to make money trading and selling cards. If you disseminate your information to anyone who asks, you’ll end up flooding the market. Keep the mentality that everyone has more money than you and everyone is out to screw you over.  [If they want the insider knowledge, tell them to read DS.com! -KBR]

Let me get into that last part briefly. It sounds paranoid, to be sure, but if you’re anything like me or most of the writers on this site, you also enjoy playing competitive Magic. Let’s imagine you’re at a PTQ with your buddy, Jimmy. Jimmy sucks at the game, but is a pretty astute trader. If you’re busy  grinding it out in round 5, and he’s been trading with all the 0-2 drop folks for the last three-and-a-half hours, it stands to reason he has cornered the market. Jimmy has also probably created a false-bubble for the card in the microcosm that is the PTQ.  He’s asking all the dealers for what is probably an obscure card, piquing their interests, and asking players to pull what is likely an EDH card they’ve not been asked about in months. Once people figure it out (especially if Jimmy is daft enough to have told them why he wants it) they’ll start valuing it higher, disabling your ability to get any that day.

Let’s get into the building of our portfolio. We’re going to start with a card which has been loudly whispered about in recent weeks. The card is Exodus’ Mind Over Matter and is part of a two card infinite combo with the M11 card Temple Bell. For the uninitiated, for each card that you discard to Mind over Matter targeting the Bell, you’ll draw a card. Eventually, you’ll deck your opponent (forcing him to die in his draw step) or throw in an Emrakul the Aeons Torn to ensure your ability to rebuy.

The parameters of a combo like this are several-fold. Firstly, it’s Legacy. This is the most explosive format for value gain differences, because the card pool is so deep. The cards that fall out of favor fall way out of favor and bottom out at low prices. A great example of this is Lim Dul's Vault. LDV as recently as last month could be had anywhere on the internet for about a buck a piece. In an unrealistically conservative environment, you can’t find these suckers for less than $5 a copy. There isn’t a stock that you could buy and confidently assume a 500+% return, yet anyone who’d ever played with the Vault could tell you it was a safe bet. What kept the price on that card down for so long? Not even joking: too much text. It wasn’t that it was competing with Mystical Tutor It was that people didn’t want to read it, or take the time to read Doug Linn’s article lauding the card. People don’t read nearly enough.

Mind Over Matter is at a low enough price that anyone can get in. This isn’t like Show and Tell or Recurring Nightmare. Mind Over Matter is ground floor Apple stock right now. This means that nearly any gain on this card is significant. If you pick up 10 at $2.50, and they go up to a dealer buy price (DBP) of $3.50 that’s a 110% growth in your portfolio, inside of a very short time-span.  What could cause a Legacy combo card to shoot up in price?

Grand Prix Columbus. It’s knocking on our doors. If you’re already going, you can go armed with Mind Over Matters that you picked up for $2.55 each, and have a commodity that at the very least will be worth $5 to people who need them on site. Imagine if Gerry Thompson once again defines a format and builds the deck that sweeps all the LCQ grinders and it features the combo. Imagine the gains from that. Here’s the first portfolio recommendation.

Mind Over Matter

$2.40-$3.50 Recommended Buy Price (RBP).

Allocate somewhere between 15-20% of your bankroll to this card. At the stated RBP, you will have 6-8 “shares” of MOMa, which is a good place to be when the value hits what I feel to be its Low Predicted Price (LPP) of $7.00.

In GP Columbus, if you are attending, I would set a “put price” on these at about $8 DBP, and I wouldn’t trade them in Columbus for less than $10, regardless of the actual price. These will be in fairly short supply at GP Columbus, and we must take full advantage of basic economic theory if we are to realize maximum profitability. I am making fairly conservative recommendations on MOMa, but one could certainly expand his risk/reward by allocating 30% of bankroll to Mind Over Matter.

If you’re not going to Grand Prix: Columbus, the more conservative recommendation is certainly one to stick with. I wouldn’t want to field the hate mail I got when this card doesn’t move up as I expect it to, but I’m strictly confident that if you go to Columbus, you can change the $20.00 you invest into $40.00. This is further evidenced by the eBay median price on MOMa, which is right around $4.30 for completed listings. If you are NOT going to Columbus, I’d recommend a quick-move strategy of selling these on the ‘bay for about $18 for a playset (BIN), and reinvesting the principal (keeping the profits as liquid back into your bankroll).

Now, not to be contrarian to what I’ve already said, but I really believe this is a blue chip, and one that will see better gains if you hold on to it longer. Because we’re dealing with “day-trader” style turnarounds, I will extrapolate future portfolios based on the assumptions laid out in this article.  Simply put, I’m going to recommend you sell it, but if you’re comfortable holding on to it, I think the gains are worthwhile with a negligible risk.

I’d also recommend Lim Duls Vault as a strong pickup for about 10% of your portfolio as a hold. This will mean roughly 1-2 LDV’s picked up (far more if you’re able to get them from the abovementioned arcane card shops). These are a good hold, as we’ve seen the upper limit of staple-uncommon cards from Alliances. There are so few cards from that set that see regular play that the obscurity leaves a lot of room for gains, even at the current price of $6-8 each.

A note: This column is titled “Flash of Hindsight” for a reason. I have a pretty stringent Magic budget, which doesn’t always allow me to invest in cards the way I would like. This means, as much as I wanted to buy Lim Duls Vault’s at $1.50, I didn’t have the liquid capital to do it en masse (the only way to mitigate the proportionately very high shipping costs). The solution is the real bread and butter of how to make a quick buck “day-trading” Magic cards.  The way one can accomplish this is not unlike a day trader on the stock market, who is glued to his ticker for the trading day, often with a coffee pot and mini-fridge stationed within reaching distance of his setup. While card-slingers don’t have to be quite as meticulous, we need to know the signs of a snap-pickup and when to do it.

The first sign is that the card has recently appeared in 1 or more top 8 decks where it had not previously appeared. This is for marquee events, such as SCG Opens and other $5K tournaments, Grand Prixs, Nationals and Pro Tours. Eureka, Show and Tell, and Lim Duls Vault are fine recent examples. When you see this, and you see a low cost on the card (though it will often be sold out), BUY BUY BUY! The best way to do this, I’ve found is to hit up magiccards.info.

After looking up the card, you can click on the price above it as pictured to the left.  This takes you to TCGPlayer’s store, which lists a bunch of their “approved vendors.” Once there, click on a vendor who has an excess of the card (remember, we’re trying to save on shipping), and buy ‘em up. I find it’s not a bad idea to not buy them out of stock, principally, we’re trying NOT to alert these dealers that there could be a run on these and to hold on to them (instead of shipping your paid-for order). The some insipid dealers will do this, so I recommend picking one or two and sticking with them whenever you can.

A second sign of a card’s increase, which often happens after the first, is that the card (suddenly) appears on StarCityGames’s buylist. Star City Games is the largest buyer and seller of Magic cards online. If they’re suddenly buying something, it’s time to trade for them or buy them for less than SCG’s buy price. This happened fairly recently with Ranger of Eos, which was a fringe card until it appeared in Tom Ross’ Naya list.

The third and final indicator of a card’s impending increase is Twitter. There are some people who reveal cards that are poised to skyrocket without even knowing it. Karakas is a great example of this.

@magicprotour said, the morning of GP Madrid:

(Tim) #gpmadrid It turns out that Karakas beats Iona. Legacy is a fun format.

As a result of that Tweet, I picked up literally five Karakas at $5-$10 in trade that day (the morning of the Richmond SCG Legacy $5K). I sold all but two since then for no less than $30 – often to dealers!

Evan Erwin (paraphrasing here) said that Vampire Hexmage and Dark Depths was a sick combo literally the day of or after Zendikar was spoiled. Twitter is such a real-time, split-second resource, and a list of people you are required to follow will be included at the end of the column today.

Having this information, and just as importantly, knowing where to find it, is paramount to being successful at rapid-turnaround trading and buying/selling for the maximum value. A data-enabled phone (at the very least, one which gives you real-time access to Twitter) is an invaluable tool in this process as well.
I realize this is getting a little lengthy, but I want to make sure that you get top dollar out of any and every transaction.

I’m asking you to trust me with $100 of your hard-earned duckets in a pretty poor economy.  I want you to come out with at least $150 by the end of the year, which is pretty bold, considering a good ROI is  8-10% annually.  I’ve only got 5 months to make five times that return for you.  Here's a recap of the resources you should have access to.

Magic Speculator's Startup Kit

• $100 split between a paypal account and cash that is earmarked for Magic purchases.
• Access to a local store with singles.
• A Twitter account. You should be following these people, at a minimum:
  • @02drop (that’s me), @legacysallure (doug linn) @magicprotour, @kellyreid (Kelly Reid), @mtgmetagame (John Medina), @misterorange (Evan Erwin) @doublingseason (duh) and finally @fivewithflores (Mike Flores, not because of the financial specs, but because he loves being included in everyone’s articles, regardless of reason).
• A phone with access to Twitter and preferably the web (the app I recommend is called “echofon”).
• The willingness and drive to work hard, act fast, and succeed.

Current Portfolio: At the end of today, I expect you to have spent about $35, and obtained about 7 Mind Over Matters and 1-2 Lim Duls Vaults. This leaves you with a liquid $65, approximately.

Current Performance: Static.

Feel free to ask me questions, or to review cards for potential gains. Leave a comment below, or email me at DAVE at 02DROP dot COM. I look forward to hearing from you all.  Until next time, may your favorite color be Green!