Welcome back, loyal readers!
You guys are doing a pretty bad job of laughing at me.
What We Learned Last Week
Last week the MODO powers that be announced that in the wake of a few events that crashed in the middle of gameplay and one of those crashes affecting someone whose opinion they care about, MODO would be transitioned to limited capabilities while they fixed a few things. The system was long overdue for an overhaul, but people voted with their dollars and let Wizards know that while they wanted their MODO experience to be better, they wanted a fixed MODO less than they wanted an uninterrupted MODO.
After the announcement was made, people took to Twitter to complain. This is all a matter of record, you know all of this. What you may not know is that this had an effect on MODO prices in a lot more ways than anyone had anticipated.
- A large segment of the population, based in countries like Brazil, can make up to ten times minimum wage grinding MODO all day. Eliminating daily events was a significant blow to their income. When there is financial incentive to do things in the MODO economy, people will do them. Without those people turning tickets into packs into cards into tickets into money, the flow of cards and tickets is hampered.
- Without daily events firing, packs are opened much less. The price of sealed packs went nuts but seems to have normalized a bit.
- A lot of people panic sold their MODO cards and the panic depressed the prices of everything in the short term. Warren Buffet says to be fearful when people are greedy and greedy when people are fearful. A lot of people got fearful and tanked prices, which made a lot of other people get greedy, which made me get fearful. Circle of life.
I didn’t have much confidence in my understanding of the market and decided to opt out of trying to capitalize on a one-time phenomenon like the crash precipitated by the shutdown for a few reasons. Firstly, I didn’t understand all the forces at play and was not about to lose money from my limited bankroll by making uneducated buys in a tumultuous market. Secondly, if I did happen to win big, my gains would not be particularly instructive. I realize most of you know more than I do right now, but a lot of you don’t and I don’t want the take-away lesson from one of my articles to be “wait until MODO is taken offline for a huge, once-in-a-lifetime overhaul and pounce on low prices when people panic sell.” That really doesn’t teach either of us skills to help us make money at this after this week. I enlisted help.
Instead of laughing at me, a lot of you were pretty helpful. I’m grateful, but it’s not really in the spirit of the exercise. But it seems like you’d rather see me succeed than fail, which is nice. It feels like cheating, honestly, but I don’t mind if you don’t mind. First of all, apparently only jackasses pay an entire dollar for a ticket. People are all over Twitter and Facebook trying to out their tix for cash and they’ll take 90 cents on the dollar sometimes. Just know that you can always pay $1 in the store. If you’re Marshall Sutcliffe, people are lined up to ship you tix for 89 cents. If you’re the MTGO Zero, maybe not. I bought from the store partially because I wanted to learn how.
I got a lot of other good tips, and rather than list them, I invite you to check the comments section of each of these installments. They’re filled with great tips from readers and will help more MODO noobs than just me. Thank you all for everything you do to support the MTGO Zero in his quest to learn a foreign language – keep the tips coming because they help everyone.
A Likely Source
I enlisted the help of Ryan Bushard to guide me through the post-pricepocalypse. I decided that there were still a few mythics that were underpriced and we agreed that it felt safe to peel off 30 tix and try to make some mythic magic happen. Ryan is a Brainstorm Brewery cast member, a writer here on Brainstorm Brewery, and also a writer on Gathering Magic. Ryan is a full-time financier, buying and selling cards. He’s been on MODO since 2003 and he knows all about the system and how the market operates, although most of his experience with MODO is using it to play and he’s still relatively new to MODO finance himself. He was the perfect person to help us with this preliminary step in our journey.
Ryan did not recommend necessarily that I peel off a mere 30 tix from my bankroll, however. He advises that if something seems relatively certain to go up, you should go deep because you can get your money back out again quickly. The ability to cash in on your speculations at instant speed makes it possible to make more transactions per day which allows us to sell at lower margins. If you buy Sphinx’s Revelation in paper for $12, are you going to sell at $13? Probably not. You might buylist them for $13 when the card hits $20 but you will wait weeks to get paid (unless you do it at a GP, which is not something you can do every day). You pay shipping. You wait for the cards to arrive, wait for them to go out, wait for the money to come back. You can sell for $20 on a retail site, but you’ll do a lot of work, pay a lot of fees, and wait a lot of days to see a return. On MODO, however, if you can buy for $12 and the bots are buying for $13 the next day, ship! (I know Sphinx’s Rev is like 33 tix, don’t get hung up on the example or you’ll never learn anything.) You will clear one ticket in profit per iteration so why not? And if you will clear that ticket, why not do it with most or all of your bankroll?
Ryan advised that the crash may have interrupted the trajectory of cards that would have moved had things gone uninterrupted. I checked the graphs on MTGgoldfish.com and they have marked the spot on each graph where the MODO events were suspended. Therefore, cards that were on an upward or flat trajectory before this point and which dropped after this point are our ideal investments. Cards that were already on a downward trajectory are less optimal. However, a bit of metagaming took place. We discussed Underworld Cerberus as a card that was getting adopted before the players migrated away from MODO. It was poised to go up and didn’t because of the interruption. This seemed like a good place to park some tix. I didn’t want to spend all 30 in one place even though it’s a portion of my bankroll. I liked Ashen Rider at .88 tix and bought 10 of those for 8.8 leaving me with 20 tix and the change in credit with various bots. Underworld Cerberus was at about 1.3 tix so 20 tix only bought me 15 copies, which I am fine with. I am going to keep a close eye on the price and move at the first sign of an upward trajectory.
Finally, Ryan advised that for the purposes of this exercise, maybe turning 30 tix into 60 isn’t the immediate goal. What I think I would really rather do is turn 30 tix back into 30 tix in a week or two and have the rest of my equity parked in long-term holds. With redemption coming up, having key cheap mythics seems like a good strategy because mythics are essential to the redemption process and will go up in price as redemption approaches. Having key mythics and my original bankroll intact seems ideal and if I can accomplish that, I’m well on my way to competence and eventually, money.
Next week, I will delve deeper into redemption and maybe in the meantime I will get to sell something. If I can figure out how to do that, you know I’ll come back at you with it. Hell, even if I can’t figure it out you know I’m going to ask someone. Until then, digest some of what we covered this week, and don’t hesitate to hit me up with questions, comments, or this community’s trademark snark. I can take it – I’m starting at zero.
Jason is a financier living in Michigan. You can find his work on Gathering Magic, Quiet Speculation, and MTG Price. Jason brings several years of MTG finance experience to the podcast as well as his signature wit and comic relief. Jason joined the podcast as a guest on Episode 10 and again on Episode 12 and it was clear that the group had a great dynamic. He became a permanent member of the cast soon after and the world of MTG finance hasn’t been the same since. Jason is also a disgruntled former member of Team Simic.