About a month ago I sold three cards within the same week for three very different returns in terms of percentages. The first position yielded me a pretty neat +480%. The second position gave me back a quite comfortable +170%. And finally the third investment returned me a more moderate +43%.

At first glance, with only these percentages you could assume that the first position was nothing but a huge money maker.

You probably figured out since the first sentence that there might be a catch here. It's not really a catch but you know that those percentages only fool the neophytes. You would probably rightfully argue that only the in fine amount of cash generated matters. In my opinion, an even better assessment of the performance of an investment should include a time component. This time component should also be further divided in two subcategories--the time between the selling and buying point, and the time it actually took to perform these manipulations.

The performance of your MTGO portfolio over the course of several months (or years) is the sum of the performance of dozens of different positions. From time to time one of them is an outstanding speculation. Perilous Vault was recently that kind of spec for me--easy to buy and sell, high returns, and all of this in less than three months. Nonetheless, most of the time and for the most of my portfolio it's an endless pursuit of the most optimal way to manage my portfolio.

Optimizing the time you spend speculating on MTGO and optimizing the ratio "profit/duration of the investment" for each of your positions are two key factors to increase your bankroll overall performances.

Time, a Precious Commodity

Here are the three cards I talked about in the introduction.

Now let's take a look at the same specs through a Tix profit lens. I sold my copies of Spoils of the Vault for a profit of 27.3 Tix, Angel of Serenity for 44.3 Tix and Voice of Resurgence for 41.5 Tix. Suddenly the percentages become much less meaningful. They become less relevant because, as you may have guessed, I didn't invest the same amount of Tix in each of these specs.

I always advise investing the same mount of Tix in each speculation. However, for a lot of different reasons it's not always possible to spend the same amount of Tix on every single spec. Card availability, big price variations among the cards you can buy, auto-increases of selling price from bots and the time you have available are as many reasons why you can't always buy the quantities you want at the price you want.

Here, I had bought 47 copies of Spoils of the Vault at 0.12 Tix/each for a total of 5.64 Tix, 22 copies of Angel of Serenity at 1.16 Tix/each for a total of 25.52 Tix and 6 copies of Voice of Resurgence at 15.66 Tix/each for a total of 93.96 Tix. Although 47 copies of Spoils of the Vault altogether don't make a huge amount investment (5.64 Tix only) this is in my range of the maximum copies of any given card I like to spec on, usually between 50 to 100. However, I really wished I had more time to buy more copies of Angel of Serenity.

Annualized Percentages and Profits

One way to evaluate the performance of your specs and to compare them among each other is to annualize the profit you made. The vast majority of my specs last anywhere between three to nine months, very rarely over a year. With all these differences in terms of percentages and Tix, profit normalizing them by the same time unit--one year--helps to compare one spec versus another.

Coming back to my examples, I didn't hold these cards for the same amount of time. To get to the results cited above I kept Spoils of the Vault for 244 days, Angel of Serenity for 91 days and Voice of Resurgence for 38 days.

Annualizing the performance of these three specs gives us a yearly rate of +718% for Spoils of the Vault, +682% for Angel of Serenity and + 413% for Voice of Resurgence.

The performances of these specs appear much closer now. From the percentage perspective and with this approach, Spoils of the Vault still performed better than Voice of Resurgence but not by a factor of 10 as the initial percentages I showed before let us believed. Taking the duration of your spec into account may help you better appreciate the end result.

Annualizing the Tix profit won't be really meaningful with my examples since there's a big difference in the amount of Tix I dedicated to each of them. It would give us +41 Tix/year for Spoils of the Vault, +174 Tix/year for Angel of Serenity and +399 Tix/year for Voice of Resurgence. It shows you how big the difference is between positions like Spoils of the Vault--kept for a long time, high percentages and moderate profit--and positions such like Voice of Resurgence--kept for a short period of time, low percentages and moderate profit also. Again, this comparison is not really fair since they were not dedicated the same amount of Tix.

The concept is rather simple--taking the duration of your specs into account gives you a better idea of their real performance. This would be the absolute way to compare your investments among each other provided you could always invest the same exact amount of Tix in each spec. Still, there will probably be another difference between your specs--the number of copies you would have had to purchase to make up for the same amount of Tix.

The Time Cost of Your Speculations

Sometimes, a lot of time. So much time that you may not be able to buy and sell what you want when you want it. As it is probably the case for many of us, investing on MTGO is something I do in addition to everything else in my daily life. At most I can spend five to six hours a week buying and selling on MTGO. In relation to MTGO I also look at price trends, write, read and play during my free time, which only leaves me a couple of hours to effectively buy and sell.

At the moment, the size of my bankroll and the time I actually have to speculate prevent me from buying and selling what I want when I want it. As a result, I sometimes need to spread my buys or sells over several days. This implies that I'm not always buying and selling at the prices I would like to. It also makes me occasionally stop buying a card because prices became too high, or miss the best selling window.

If you have all the time you want speculating on MTGO, you may still want to save time to do something else. You could spend that time looking for more information about potential specs, spend more time with friends and family, go to the gym or finish the book you always wanted to finish.

Buying and selling a playset or two may take you anywhere between a few seconds to a few minutes (if you spend more time finding the best buying/selling prices). Buying and selling hundreds of cards is clearly time consuming. Not to mention that generally as you buy more cards your average buying price increases and as you sell more cards your average selling price decreases.

This notion appeared clearly when I analyzed some data from my Nine Months of Portfolio Management. I compared the hourly rate of different positions based on their performances and buying prices. As cards got more expensive I needed to buy fewer copies to make up for the maximum Tix I had dedicated for each positions. Fewer copies to buy, and sell, equals less time needed to do these operations. It means that if for the same exact result (percentage and Tix profit) the fewer copies you have to buy the better your hourly rate at investing on MTGO is.

In the article Nine Months of Portfolio Analysis--Data Analysis I estimated two minutes as the time needed to buy and sell a playset (this time includes all the extra things you do when buying and selling). Coming back to the three examples of this article it had taken me about 24 minutes to deal with my spec on Spoils of the Vault, about 12 minutes for the copies of Angel of Serenity and about 4 minutes to deal with Voice of Resurgence. Since buying one, two three of four cards requires the same action all numbers are rounded up to the nearest amount of playsets.

Converting this into an hourly rate now:

• Speculating on Spoils of the Vault took me 24 minutes for a profit of 27.3 Tix--68.25 Tix/hour
• With Angel of Serenity, 12 minutes for 44.3 Tix--221.5 Tix/hour
• For a profit of 41.5 Tix it took me 4 minutes with Voice of Resurgence--622.5 Tix/hour

This tells me that among these three cards the time spent on Voice of Resurgence was the most valuable, almost 10 times more valuable than the time spent on Spoils of the Vault.

Let's imagine for a second I had been able to spend as much on Spoils of the Vault as on Voice of Resurgence. With the same buying and selling prices I would have had to buy 738 copies of Spoils of the Vault to make up for 93.96 Tix. +480% this would have given me a profit of 451 Tix. For which I would have had to spend about 6 hours and 30 minutes to buy and sell of these 738 copies. Although the overall profit increases, since I would have bought more copies, the hourly rate remains the same 68.25 Tix/hour.

If your time is valuable, and as your bankroll grows, you need to make sure to spend your time on investments that are as significant as possible for your bankroll size. Incredible returns on penny cards may not worth the shot anymore. Alternatively, moderate returns and more expensive cards might be the way to go and to increase your overall profit.

Next week, I'll try to come up with a formula to estimate the performance of any specs, taking into account the profit and the two time components I discussed here. In the mean time I wish you a happy holiday season!

Thank you for reading,

Sylvain Lehoux