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I hear a lot about “that guy” in trading articles. You don’t want to be him. But today I’d like to talk with you about a different “that guy,” one that you may even want to be. He turns the pages of your binder decisively, skipping the cards that give most people pause. You end up trading him a bunch of garbage for one or two midrange staples, and feel pretty good for dumping your chaff. Two weeks later, almost every card he picked up from you has increased in value, and the trade no longer looks so good on paper. You resolve to read more articles from the pros, and up your game, yet you see him do it again and again. How does he do it? Perhaps your friend really has a line that you don't about what's coming, but it seems more likely that there is a method to his madness.
Reason Proactively
There seem to be two modes of thought when considering Magic investment: Reactive reasoning, and proactive reasoning. When Survival of the Fittest decks make up 60% of the top-18 field of the latest big legacy tournament, and you run out and buy a playset of Survivals, you are investing reactively. The same goes for buying Avenger of Zendikar after Paulo Vitore Damo da Rosa used it as a centerpiece of his PT: San Juan winning block deck. If you're fast (really fast) with reactive trends, there is a good bit of money to be made here, but this usually entails buying up every copy on every obscure website that you can find. In my experience, this often does not work out that well. It's shocking how many stores will suddenly have "inventory errors" right after you buy their 30 copies of Grim Monolith for $2 each following WotC’s unbanning it in Legacy.
In your case, you follow the top-8 performances. You are completely ready for "that guy" to pull out your Oracle of Mul Dayas, your Stoneforge Mystics, but those are not the ones that he bites on. So this can't be the game that he's playing. It seems more likely that your friend is practicing proactive investing. Any reactive move is a response to the past. He is dealing in card futures.
We all know the cliché "buy low, sell high." When you buy reactively, you are aiming to buy fast in anticipation of a short-term spike. If you aren't fast enough, you'll unwittingly buy in the middle, or even at the peak of that spike. Either way, you've lost efficiency, and if the price drops at all before you sell, you could even lose money overall. Even the best reactive purchases can become losers if not sold quickly enough. And a banning by WotC can leave you wasting hundreds of dollars (here's looking at you, Flash). The best way to really win is to already have the suddenly hot cards, and to be selling them at mid to peak points to the reactive buyers who form the bulk of demand driving the market.
I can hear you now. "Thank you, Captain Obvious, of course it'd be awesome to know the future." Good, then you're ready to start.
Inform Yourself
The best way to prepare yourself for a prospective discovery is the part that many consider the most tedious: research. Having an encyclopedic knowledge of cards is a proactive trader's best friend. If you do not know every card in the format you are playing or investing in, you are setting yourself up for failure. When looking at a new card, you have to be able to ask yourself if the card has any inherent synergies in the format in question, whether its casting cost gives it an inherent advantage, or whether its drawbacks are mitigated by other cards you could play. Even more importantly, researching the metagame (learning the makeup of the current relevant decks in a format) will allow you to discover cards that will exploit weaknesses in current decks.
Think Metagame
I break the Magic metagame into two broad categories: the Standard metagame, and the extra-Standard metagame. The Standard metagame is undeniably the most exciting, as its constant changes allow for many opportunities for proactive investment. Right now, at the beginning of a new block, is the best time for it. Titans currently dominate the format. Primeval Titan, often in conjunction with Oracle of Mul Daya, has spawned a plethora of “ramp” strategies. Frost Titan, in conjunction with the most powerful card in Standard, Jace, The Mind Sculptor, gives control decks a great long-term game. Trinket Mage packages are also rising in prevalence, as card advantage appears to be winning over raw power as usual. Rounding out the rock-paper-scissors, agro decks are largely dominated by red, with boros and red deck wins rounding things out. Goblin Guide, prevalent in both of these strategies, is as hot as it’s ever been, seeing play in both Boros and mono-red, as is Spikeshot Elder.
This gives us a lot to work with. Frost Titan’s rise has overshadowed Baneslayer Angel, and when coupled with Abyssal Persecutor and vastly superior spot removal, we see compelling evidence that U/B has largely replaced U/W as the control deck of note. But what is most evident across-the-board is that creatures are the current driving force in Standard. This means that board-sweeping effects are going to be powerful. Most finishers in non-agro decks run high converted mana costs; gone are the days of riding a turn 2 Knight of the Reliquary to victory. This means that Memoricide is a no-brainer; investing in it at this point is essentially reactive, but I think it still has room to grow. Slightly less obvious may be Consume the Meek. Although primarily a sideboard card, giving black the ability to counter both the haste and landfall strategies of current agro decks at instant speed should prove important to control builds moving forward. Creeping Tar Pit should rise as well, since it’s now in and Celestial Colonnade is out, giving the same deck an answer to opposing planeswalkers. Tar Pit is currently answered only by opposing Tectonic Edge, Consume the Meek, or Disfigure (a compelling reason to make Disfigure a maindeck inclusion in U/B control).
But let’s dig a little deeper and get really proactive; let’s talk about the future. The rest of the block following Scars promises to make artifacts more relevant than they’ve been in a long while. Assuming a metalcraft strategy proves viable (I think it essentially a given that it will), Etched Champion promises to pay off. A low-CMC artifact with a powerful metalcraft effect is hard to find. Metalcraft strategies are contingent upon the whole being stronger than the sum of its parts, meaning that when metalcraft rises, the Champion’s 2/2 body should not prove a disqualifying factor. It’s virtually guaranteed to be a 4-of in any such deck, and it counters itself nicely, all of which suggest strong future demand. Being immune to most spot removal is also key, since the greatest weakness of a metalcraft strategy is the two-for-one potential of destroying that critical third artifact. Artifact creatures are that much more vulnerable than non-creature artifacts, and Etched Champion is more resilient than both. Working best in multiples, it also wears a Basilisk’s Collar admirably well, which speaks well to the future of both cards.
Speaking of Basilisk’s Collar, the card is amazing. Present in nearly every red deck’s sideboard or maindeck, the card is worthy of note. Currently they are a 1-2of in most builds, but being collared is so powerful in metalcraft that I see the card trending up as it should see play in greater quantities in the future. The current prevalence of Basilisk’s Collar, Adventuring Gear, Trinket Mage toolkits, and a prospective inevitability of metalcraft suggest a trend toward Thada Adel, Acquisitor as well. Already considered one of the best blue creatures in EDH, this micro-cap card promises value, in more ways than one. Buy 20 for less than 10 bucks; you’ll be very glad that you did. Even if the card does not prove to pay off in Standard, the card’s EDH outlook will make it a $3+ card in the future, so in the worst case you will net yourself a $50 bill.
I’ve spent a lot of time discussing the Standard metagame, so I’m going to have to go a little light on the extra-Standard section today. The rise of Phyrexian Devourer, as catalogued by Gerry Thompson’s 2nd place finish, and Jesse and Alix Hatfield’s 7th and 9th place finishes in recent SCG 5k Legacy tournaments, should be noted. It seems to have gone unnoticed so far that Phyrexian Devourer is on the reserve list, meaning that if Survival of the Fittest is not banned at some point, the Devourer stands to gain significant value.
Although I don’t currently see it having a huge impact, integrating Scars-era artifacts into affinity should pay off. If nothing takes, Arcbound Ravager should still trend up mid-term, due to prospective interest and people testing new viability. If a great synergy does emerge, the payoff will be significant.
In closing, I’m concerned that I haven’t given you enough to work with. I’m going to attempt a “that guy”-level call, and while it is almost certain to get me mocked in the short term, we’ll have to see how it pays off. There is a card in Standard that actually synergizes magnificently with one of the hottest cards featured in each of the three archetypes I discussed above, while also possessing a number of other strong qualities I mentioned. It is a non-mythic micro-cap rare from Scars of Mirrodin, and garners a price tag of roughly $.25.
Stumped? I’m talking about Cerebral Eruption. Yeah, really. This card seems far too random to possibly be good, unless you evaluate it using the guidelines I established earlier:
When looking at a new card, you have to be able to ask yourself if the card has any inherent synergies in the format in question, whether its casting cost gives it an inherent advantage, or whether its drawbacks are mitigated by other cards you could play.
With its 4 CMC, this card can easily beat Eldrazi Monument into play. When it hits, it is usually a one-sided Firespout that also kills opposing Planeswalkers. With all of the 6-CMC bombs floating around, a wrath and bash is quite often game over. But only if we can hedge our bets. Enter Goblin Guide, Jace, the Mind Sculptor (fateseal, baby), and a clincher in opposing Oracle of Mul Dayas. Goblin Guide’s is a must ability, so even when it hits a land it effectively gives you a second chance in the turn. And say you do whiff with it. what are they going to do, play into it? The only thing it does not seem great against is an opposing Jace always brainstorming a land on top, but that’s why you hold Lightning Bolt and run your own Jaces to fight it. Oracle is playing all the land off the top of their deck and giving you the knowledge you need. And Jace is just Jace. Never have I more wanted Ponder to be Portent, but eight enablers with a potential for twelve in ramp matchups is not bad. Call it too narrow, call it too random. But consider this: A $25 investment in Cerebral Eruption will net $100 in profit for every dollar the card increases in price. Worth considering now? Because for me, it’s Simply Matthematics.
I wanted to post a trade I made a couple weeks ago that kind of shows what you can get thinking in advance. It's obviously not on the same level but I was proud of my forward thinking as a beginning trader and wanted to see if I was rightfully proud. Please evaluate this trade and let me know. 🙂
MY
Elspeth Tirel (valued at $33.00 at the time)
for
HIS (total value around $38.00 at the time)
Wurmcoil Engine
Ratchet Bomb
Jace Beleren
Birds of Paradise
Ajani Goldmane x 2
Garruk Wildspeaker
The reason I made this trade is because I saw that Elspeth really wasn't the focus of any of the Top 8 decks that I had been seeing and wanted to get rid of her before the inevitable drop. If you look at the price now compared to then I think I did fairly nicely in my speculation. Agree? Disagree?
I think it was a prudent move. I try to gauge my successes not on the margin of increase, but whether the call was right. It's a lot harder to say "___ will rise to $20" than it is to say "___ should rise." If the should bears out, then a win is a win.
Hi Matth – Thanks for the insightful article. One question I have is how you go about withdrawing value after your cards have risen in price. Cerebral Eruption, for instance, is available on ChannelFireball for 0.25 each but then you have to pay $2.64 shipping on top of that. So you might spend $27.64 today to buy 100 copies. The card rises and is now being sold by many stores at $1.00. Do you sell them to a store's buylist at 0.50 each, minus your shipping cost? It would be a rare store that would want 100 copies of a $1 card. You could eBay but between shipping costs and eBay/Paypal fees you would be eaten alive.
I'm in this position with some cards I bought a while back for this very purpose (Tectonic Edge and, more recently, Splinter Twin). I did not think through how I was going to withdraw my money. They have both risen a bit and I can sell them on eBay now and break even but that doesn't seem so hot.
I would love an article on this topic!
You make "that guy" seem like a bad thing, even though 99% of the people on this site are trying to become "That guy."
@Memidas: $33 Elspeth? In what world?!
That's the thing, I think "that guy" has been miscast. That's why I wrote that this article is about a different kind of "that guy," one you might want to be.
@juan: It's about buying large quantities in one go. You can often find 4x playsets for sale in BINs in Ebay with multiple copies for sale, then get combined shipping.
These sell out quickly when there's even a whiff of interest in a card. That's why making proactive calls is valuable, because if they're correct, you get to be "that guy."
But it takes balls to be the first in. And it's not without risk.
Getting in seems much easier than getting out. Once these is a whiff of interest in a card how do you clear them out quickly? Have you had success in finding stores that will buy large numbers of cheap rares?
A question about pricing, also. You say that if a card is bought for $0.25 today, then if it rises $1 you have made $100 for every $25 you invested. The math is fine but the card is being sold by a vendor at $0.25. Are you waiting for the vendor price to hit $1.25 or until the card reaches $1.25 on store buylists? If you wait until the card is being sold by stores for $1, say, the vendor price has tripled but your potential for profit has not because you cannot sell those cards for $1 each. If I'm wrong about this, please let me know where. This is where the article fails me in a logical sense.
**Quadrupled, even!
There are a plethora of options available for getting rid of cards.
1. Sell them to dealers at their buy price.
2. Sell them yourself on Ebay.
3. Sell/trade them at PTQs, etc. (careful with the cash).
4. Sell/trade them at your LGS.
My articles are going to hinge on the notion that you are active in the Magic community. You are correct, there is no "stock market" where you can set selling limits to automatically dump your stock. With that said, it is not spectacularly difficult to sell 10+ copies of a single card to most dealers. Perhaps this doesn't seem like such a good deal, but consider the following:
You purchase 100 Cerebral Eruptions for $25, then add say $9 for shipping. So you've invested $34 in the cards.
The card rises in value to $3 (dealer sell price). You trade 20 of them off over two gameday weekends at $3-4 apiece, sell five playsets on Ebay for $2.50 apiece after Ebay fees, and then sell the remaining 60 to six separate dealers at a PTQ the next weekend for $2 each.
So that's $70 from the first batch, $50 for the second batch, and $120 for the third batch. $240-$34 = $206 profit.
So, you haven't gotten maximum value for all of your cards. Was that your objective? Mine is to make money. Sometimes it's more important to get out at the right time than it is to get the absolute maximum value for your stock (in the department store market, they call them "sales." plenty of profit is still made).
You're going to have to be creative with getting rid of your stock of cards, but that's always been (and always will be) a part of the game. I assume that in time, I may develop an arrangement with certain dealers to get a small premium for my cards, since they know I'll always have a stock when a jump occurs. I don't know; maybe that'll never happen. But in the meantime, I'll suffer along with only making $200 profits on $34 investments.
In short, I can show you an ocean, but you're going to have to jump in before you can teach yourself to swim.