About the Author
@acmtg   -    Articles Anthony is your typical started-during-Revised-then-quit-then-came-back-years-later Magic player. He enjoys the financial aspect of the game the most, mainly because it lets him use his analytical side but also because it makes up for the money he hemorrhages drafting on MTGO.

The Wealth Effect

Magic financiers typically point to the growth of the playerbase as the primary driver of rising card prices in recent years. Rising card prices, in turn, have been the primary driver of Magic finance. Without new money pouring in, speculating on Magic cards would largely be a zero-sum game closer to gambling than investing.

The magnitude of this growth really came to light after the Hasbro Toy Fair Investor Presentation two years ago. They showed us this chart:

Hasbro 2013 Slide

The chart shows that Hasbro attributed approximately 75 percent of revenue growth from 2008 to 2012 to “growth from player population” (had to estimate since the bars aren’t labeled) and about 25 percent to “growth in per player spending.” Simply put, new players were the ones mostly responsible for the surge in Magic’s sales.

Now let’s look at a slide from this year’s version of the same presentation, which was released just about two weeks ago.

Hasbro 2015 Slide

Interesting how things have changed.

Hasbro is reporting that the active player base grew by only six percent in 2014, but that per-player spending grew by 11 percent. It can be tough to make perfect apples-to-apples comparisons from these presentations because there are small but important differences in the way Hasbro reported the metrics, but I think the overall message is clear.

In 2014, the increase in per-player spending of existing players had a bigger impact on Magic’s revenues than new players did. This is a pretty dramatic reversal from a few years ago.

New Players, Old Players

Take a minute to think about new players and existing players and your experiences with them. Anecdotal as it may be, I think it’s a good way to add context.

My perception of new players is that they mostly buy sealed product. After new players start playing Magic, they go through a phase where they accumulate cards to start a collection and begin building decks. To accomplish this, they buy boosters, fat packs, intro decks, etc. I’m not saying it’s the only thing they buy, but it’s the main thing.

New players do trade for cards, but they need something to trade away first. They might buy some individual cards to fill gaps here or there, but I rarely see brand new players shelling out for expensive singles and I rarely see them putting entire decks together this way. Even if they want to jump right to a fully-built deck, they are more likely to buy a Commander deck or another preconstructed product than to walk into a game store with a deck list and a credit card.

Existing players are mostly the opposite, from what I have seen (and since I am one of these, from what I do). Most of their money goes to singles because they have a better idea of what they need and buying singles is the most cost-efficient way to get those cards (aside from trading). Existing players are much more likely than new players to be playing expensive formats like Modern or Legacy as well, and with few exceptions the cards needed aren’t available in sealed product.

Existing players do buy some sealed product, in my experience. They certainly draft with it, and they might pick up some amount of sealed product each time a set comes out. It could be a booster, a fat pack, or maybe even a box. Still, I think it is typical for existing players to spend more, and sometimes considerably more, on singles than on sealed product. I know this is the case for my playgroup.

Based on this, one would think that the key to Magic’s revenue growth is new players buying sealed product. While existing players do supplement this revenue, a large part of their spending goes into the secondary market and thus does not make it into the coffers at Wizards HQ.

At least that’s what I thought two years ago. Hasbro said in their annual report that year that Magic revenues grew by 30 percent, and if three-quarters of that came from new players (as the graph indicates) we were looking at 22.5 percent growth in the player base. That number dwindled to six percent in 2014.

Here’s the thing about new players: they don’t stay new. By the time Hasbro issues its next annual report, this year’s class of new players gets tossed right in with the existing players. Hasbro is depending on another group of newbies, even bigger than the last, to show up each year.

In 2014, the class of new players was bigger than the year before, but not that much bigger. Don’t get me wrong—six percent growth is still very strong; it’s just not the explosive growth we have become accustomed to. In fact, according to the 2014 slide, the increase in per-player spending outstripped the growth in the player base two to one.


The story of Magic’s growth, it seems, has taken a turn. Today it is less about new players than about existing players spending more on the game than ever before. It’s about you and me opening our wallets even further. We’re getting older, we’re making more money (maybe even because of this website), and we’re spending it on Magic.

What does this mean for Magic finance?

Changing Dynamics

The first thing I want to point out is that existing players haven’t changed their habits too much. The flip-flopping of new and existing players is mostly about the precipitous drop in new player growth. Existing players may have upped their spending marginally, but that spending is now much larger in comparison to new players than it was before. [Quick math: if 22.5 of the 30 percent total growth in 2012 was from new players, 7.5 percent was from per-player spending growth. It’s 11 percent today.]

The second thing is that existing players are probably still spending most of their money in the secondary market, and that still doesn’t show up on Hasbro’s slides. With existing players, think of that 11 percent revenue growth as the part of the iceberg above water; for every dollar that goes to Wizards for sealed product, there are many more going to local and online dealers that we can’t see.

That’s mainly to say that dwindling player growth doesn’t spell an immediate end to Magic finance. I’m still spending my bonus on dual lands for my cube this year just like a lot of you, and that is still going to drive those prices higher regardless of how well Fate Reforged sells.

It certainly does affect the outlook for recently printed cards, though. One of the tenets of Magic finance is that out-of-print cards will climb in value due to growth in the playerbase. For example, Wizards will print enough Khans of Tarkir for the playerbase today, so after a few years of solid growth in the playerbase and no more Khans being printed, there will no longer be enough to go around. Prices climb. We’ve seen it happen over and over.

Now we may be looking at a world where the player base will be only slightly larger next year and the year after. Prepare for the possibility that there will still be plenty of [card]Siege Rhino[/card]s to go around in 2017. Every time you hear the phrase “slow gainer” in 2015, take a drink.

Also consider that cards which formerly held high prices due to low supply (not high demand) and have been reprinted near the height of Magic may be ruined forever. That is to say, the days of “recovering” from a big reprint may be behind us if the card is not a tier-one Modern staple. [card]Stifle[/card], I’m looking for you. There might be enough [card]Stifle[/card]s at under $10 for everyone that wants to play them for a long time.

Wealth and Magic

In the past, we’ve focused on demand created by new players picking up the game and “catching up” on out-of-print cards. I think it is time to start shifting that focus to the demand created by existing players as they accumulate wealth. Why the change? Because this wealth effect is not going way, no matter how weak or strong Hasbro’s sales are next year.

Magic is twenty years old. Those of us who started playing as kids early in the game’s existence are now in our late 20s or early 30s. Most people make a lot more money in their 30s than they did as kids. Guess what? Most people make more money in their 40s or 50s than they did in their 30s, too. Many Magic players are now squarely in their prime wealth-building years.

This is to say that even if you froze the player base at the current size, prices of out-of-print cards could still increase. Wealth triggers demand. Every year, I can afford something I couldn’t afford last year, and every year it gets easier to justify spending more money on my hobbies. Magic players are an intelligent bunch. I imagine that, on average, they are well-educated and successful. That means they are going to make quite a bit of money in their lifetimes.

Not only are players building wealth, but more players are graduating (literally) to this wealth-building period of their lives each year. You know the drill—work hard, graduate college, get a good job, buy power. This wealth-building period of life is long. Unlike the quick transitions from high school to college to the job market, people stay in this phase for decades.

For lack of a better way to say it, many Magic players are becoming rich and these rich Magic players will probably grow in number for years to come.

As we established earlier, experienced Magic players tend toward the secondary market. Nobody is buying ten cases of Khans instead of a Lotus. So what exactly are they buying? Ask yourself that question, because you are very likely an experienced Magic player.

If you had the money to buy any Magic card, what would you buy? The question is becoming relevant to a lot of players and I can tell you that the answer is never [card]Siege Rhino[/card].


In Conclusion

The growth in the playerbase may vary quite a bit in the coming years, and that is going to make Magic finance tricky when it comes to newly printed cards.

One thing you can count on, though, is that entrenched Magic players are accumulating wealth and will continue to spend more and more of it on their hobby. I think this will be the biggest driver of Magic finance in the future, if it isn’t already. Remember, the 11 percent growth in per-player spending last year doesn’t include secondary-market purchases, it’s just the tip of the iceberg.

If new player growth drops to zero, newer Magic sets are going to have a very hard time holding value. But this money from entrenched players is still going to be out there, growing, and chasing high-end Magic cards. The most attractive cards in this environment are those that are highly coveted, in limited supply, and are immune to reprints. Obviously that spells “Reserved List” for most, but there are other unique and rare cards out there that will benefit—promos, old set foils, etc.

That’s all I have for today. Find me on Twitter or Reddit (@acmtg) if you have any questions or comments.

Thanks for reading.

Always and Never in Magic Finance

Today I want to talk about one of the great traps in Magic finance, or really any kind of investing. The trap is forgetting about, or just ignoring, this statement: past performance does not indicate future results. To take it to the extreme, it’s the trap of “always” and “never.”

Let’s start with an example. Take a look at the following chart, which is the price of a Revised [card]Underground Sea[/card] circa May of 2014 (just before Journey Into Nyx hit). Before you continue reading, take a few mental notes on what you see.

Underground Sea 1

Here are my notes for comparison:

  • [card]Underground Sea[/card] has seen about a 150% gain since June of 2012.
  • It has not seen a meaningful decrease in price during that time.
  • It has recently seen a dramatic increase in price (January to May of 2014) and has not leveled off.
  • The last significant jump was about one year ago, in May of 2013.

That is a pretty matter-of-fact interpretation of the data. Importantly, it’s entirely focused on what the card has done in the past and doesn’t make any predictions about the future. Let’s be honest, not many of us were quite so level-headed about duals at the time.

You were much more likely to see the following comments on [card]Underground Sea[/card]’s price movement from Magic financiers last May:

  • [card]Underground Sea[/card] has never dropped in price meaningfully and likely never will.
  • Based on the current trajectory, the price will certainly climb to $400 soon and $500 eventually.
  • Duals now appear to have a seasonality (see May of 2013 and 2014) as people sell out of Standard in the spring and want to preserve their capital.
  • Reserved List cards, with duals among the most desired, are truly the only safe haven in Magic finance.
  • There is no ceiling.
  • Sea, like other duals, is a good buy at any price since they will never drop.

You might notice that these bullets are made up of observations and conclusions smashed together. The support for these conclusions comes from a false equivalency of past performance and future results. Dual lands have never gone down in price so dual lands will never go down in the future. [card]Underground Sea[/card] has increased dramatically in price so it will increase further in price.

Now let’s look at how things unfolded (if you don’t already know) and then go back and take another look at the analysis.

Underground Sea 2

[card]Underground Sea[/card] (like most of the duals) has dropped by about 20 percent since May and does not appear to have leveled off.

The Mistake of Always and Never

This is not an “I told you so” article. No one that I’m aware of called for a substantial decline in the dual lands this year. I certainly did not.

This is not a “we should have seen it coming” article, either. There was every reason to think that duals would continue to climb in price based on the trend. There was nothing, at least that I can tell, that forecasted this drop. Vague statements and doomsaying like “they can’t go up forever” do not count as forecasting a 20 percent decline, either.

The mistake was turning probably into always and turning probably not into never. If you deployed money based on those equivalencies, you lost and maybe lost big.

It’s a subtle distinction on paper but a massive change to mindset. We will make drastically different investment decisions when looking at probably than we will when looking at always.

Probably calls for an investment coupled with the usual safeguards: diversification, properly sized investments, and other risk mitigators.

Always is a sure thing, a stone-cold mortal lock. Always means safeguards are not necessary, that caution can be thrown to the wind, because it is 100 percent. If you ever find one, go ahead and bet it all—no one would argue against pushing all-in when your opponent is drawing dead. Good luck finding these opportunities, if they even exist.

You really can’t afford to confuse “always” and “probably” when a lot of money is on the line.

Variance in Investing

To be clear, the correct read on that first chart (May 2014) is that Underground Sea would continue to increase in price. There was nothing to support a call for a decline or a break in the trend.

The thing is, we often forget that there is massive variance in investing in Magic, just like there is variance in the game itself. In fact, there is massive variance in any kind of investing.

You can’t solve an investment any more than you can solve a game of Magic. Perfect play loses to timely top decks from your opponent, and sometimes cards drop in price that “shouldn’t” drop or have never dropped before. You can stare at charts and spreadsheets until your eyes pop, but you will never get the variance out.

Everything indicated duals were safe and would continue to go up, but they went down instead. Are there reasons for this? Maybe. Somewhere buried in a thousand variables there might be an answer, but we are not going to solve it and we are certainly not going to predict it. Call it variance.

These things just happen. Duals always go up until they go down. At some point we may get confused and think they can’t go down. The same was true of the U.S. housing market a few years ago.

The good news is that this is all very easy to work around, at least in Magic finance. Just plan for variance in your Magic investments. You can do that in a lot of ways, but here is the executive summary: never make an investment that will break you if you lose it. It’s only really a problem if you are making large bets.

Dual lands are a great example to use here because they, more than almost any other set of cards, entice financiers to make those huge bets. You don’t have to worry about variance very much when you pick up a hundred copies of a bulk rare. Your safeguards come built in in the form of a low price. A single Underground Sea costs more than that spec, and the financiers investing in duals are buying lots of dual lands. It’s adult money.

If you have a playset of Underground Seas that you can use in a Legacy deck, big deal, they are worth less now. If you dove headfirst into Magic finance by buying $5000 in duals, well, that’s a lot tougher. It could be quite a while before you break even, let alone turn a profit.

“Always” and “never” are not words that should be in your vocabulary if you are investing serious money in Magic. Top Magic pros don’t say, “There’s only one card that beats this line but I haven’t seen it yet so he’ll never have it now.” They painstakingly play around the one card that the opponent, in all likelihood, doesn’t have in his hand or maybe even his deck because they risk losing everything if they don’t.

Invest the same way. Press yourself into finding the scenarios where you lose big and don’t dismiss any of them as too unlikely. Don’t take the shortcut of simply extending the trend line.

Upcoming Opportunities

This isn’t just a dual land thing. I see it elsewhere in Magic finance. Here is a short list of investments where I regularly see people turning probably into always. If you are thinking about putting real money into one of these, be sure you aren’t making assumptions.

1) Sealed Product – Many people did well holding sealed product during the Magic boom. That has morphed into the perception that sealed product always goes up, always gives you a good return, and never drops.

Avoid This Mistake: Don’t be the one with a closet full of recent booster boxes when the paradigm on sealed product changes. Eventually it will—there are already cracks in the foundation.

2) Modern Masters 2015 – Whatever you think you know about this set, forget it. In fact, forget it is even called Modern Masters because it will behave radically different than its predecessor. Forget what you think you know about the cards that will be included and what it will do to their price.

Avoid This Mistake: Don’t empty your checking account for [card]Tarmogoyf[/card]s and other Modern Masters reprints if they show up in MM2015 and dip in price. Yes, they spiked majorly after the first reprint and turned out to be a great buy, but you are working with one data point. A repeat is far from a given, and this really could be the time that Goyfs go down and stay down.

3) Legacy Staples – If I asked every reader of this article what dual lands are going to do next, I bet some of them would say, “Duals are going back up because duals always go up.” Re-read the article. Maybe [card]Underground Sea[/card] bounces, maybe it drops another 10 percent.

Avoid This Mistake: Don’t assume that a 20 percent drop eliminates the risk from buying duals and make the same mistake this article is about by plowing all your money into them now. It very well could be a buying opportunity ([card]Volcanic Island[/card] is already ticking up) but a deeper decline is not impossible, so please use caution. Make sure your buys are appropriately sized and you are not overextending.

That’s all I have for today. You can find me on Twitter at @acmtg if you have any questions or just want to discuss Magic finance.

Thanks for reading.

What Wizards Wants: Reprints

Magic players can be selfish. When Wizards of the Coast makes a decision or a change to the game, most people talk about how it affects them. Standard players talk about how it affects Standard, Cube enthusiasts talk about possible inclusions from the new set, Modern and Legacy players look for playable eternal cards, and so on. It’s normal to form your opinion based mostly on how the change affects you.

What strikes me, though, is how oblivious some people can be to WOTC’s perspective. Wizards is in business to sell Magic: The Gathering product and just about every decision the company makes is a means to that end. When you start to look at it like that, the thought process behind business decisions becomes a lot easier to understand. And if you can understand WOTC’s decision making, you can better predict its future actions.

For example, there is a perpetual discussion on whether or not [card]Birthing Pod[/card] should be banned in Modern. People will typically cite power level, diversity, the need to shake up the format, etc., when making a case.

Wizards, at least at a high level, is not overly concerned about optimizing the Modern tournament experience at any given moment. Sure, it’s on R&D’s radar and they certainly want it to be good, but Modern Constructed is just one tool in their toolbox for creating demand for their product.

Wizards is not in business to balance Constructed formats, it is in business to sell product. WOTC doesn’t really care that much when six of eight decks in a grand prix top eight are Pod decks, even though that might be incredibly frustrating to a die-hard Modern grinder.

When it comes to [card]Birthing Pod[/card] and moving product, Wizards is probably considering a menu of options like this one:

  1. Reprint it to sell packs.
  2. Print must-have Pod hate cards to sell packs.
  3. Ban it to shift that demand to something else they can sell.

We underestimate how important sales are to Wizards of the Coast and overestimate how important everything else is. R&D’s decision on Pod is just as likely to result in a fixed [card]Null Rod[/card] in the next block at mythic rare as it is in banning Pod itself. This way they can keep Pod in Modern Masters II and juice sales of both sets.

So today I’m going to write from the other side of the table. I’m going to approach a topic from WOTC’s perspective by taking the sales-first position, explaining what I believe drives the team’s decision making. I’m going to support my points with actual decisions made by Wizards, but be aware that this is really an opinion piece. I don’t have access to anyone at Wizards or to any non-public information.

Since we’ve already started in that direction, today’s topic is going to be reprints.

Printing Money

Reprints are a beautiful thing for Wizards because they allows the company to convert equity in the secondary market (which belongs to someone else) into sales dollars for themselves. Reprints also conserve R&D resources in the process.

Wizards does not have a direct stake in the secondary market. That means that when [card]Thoughtseize[/card] went from $30 to $60, Wizards didn’t see another penny because that card was out of print. The new equity belonged to the players and store owners who owned copies of the card. But Wizards is not out of this game by any stretch of the imagination.

While Wizards doesn’t have a direct stake in the secondary market, it certainly has ways to interact with it. One of the best ways is through reprints. It’s important to remember that WOTC’s production costs are the same whether they are printing a sheet of [card]Thoughtseize[/card]s or a sheet of basic lands. The first is a sheet of twenty-dollar bills, the second is worth less than the paper on which it is printed.

It does feel a little like printing money in that respect. They have been doing it for years with the judge program, using reprints as a currency to buy needed labor.

Now, the players and store owners who had all the Lorwyn [card]Thoughtseize[/card]s lost half of their equity when the reprint dropped them from $60 back to $30, but it undoubtedly moved a ton of Theros packs for Wizards in the process. Our loss is their gain, but cashing in on valuable assets is solid business strategy and I wouldn’t expect anything else.

Was the [card]Thoughtseize[/card] reprint a developmental mistake? Was it too powerful for Standard? These questions are secondary to, “How many Theros packs will a [card]Thoughtseize[/card] reprint move?” Wizards might tell us that [card]Thoughtseize[/card] was printed to give black some play against enchantment creatures, but that’s only relevant because it fits into the larger strategy of reprinting high-dollar cards to move product. A new, lower-power [card]Duress[/card]/[card]Despise[/card] hybrid would have done the trick, too.

Similarly, many were surprised when Mark Rosewater explained that the allied fetch lands were the first cards in Khans of Tarkir, despite lacking the design synergy that we saw with fetches in Zendikar. No one should have been surprised. Printing high-value cards is a lucrative business and these were prime candidates. Trust me, Wizards cares about the efficiency of mana bases in Modern way less than it cares about spiking Khans sales. Way, way less.

Deconstructing Constructed

One very significant thing to note here is that a lot of these reprints are being put into Standard-legal sets. Wizards can print pretty much anything in a supplemental product without worry, but that would be missing out on the huge demand that comes from a Standard printing. This is worth taking some risks in the format. Cards like [card]Mutavault[/card], [card]Scavenging Ooze[/card], and [card]Chord of Calling[/card] are great examples. These cards didn’t need to be in Standard—no one would have missed them if they weren’t.

What it means for us is that we can expect a steady stream of high-profile reprints popping up in large Standard sets. If it can go through Standard, it will go through Standard. Why give cards straight to Modern players in a set like Modern Masters when you can make Standard players buy them too?

Of course, not everything is fit for Standard. Cards that really would wreck the format, would subtract substantially from Limited playability, or feel badly out of place flavor-wise can go straight to the supplemental products. You risk hurting sales as much as helping if you get too ambitious.

If we extrapolate this line of thinking, we come to the conclusion that the enemy fetches will not be in Modern Masters II (but will instead be in Standard at some point). We also come to the general conclusion that things left out of reprint sets have a higher-than-usual chance of showing up in Standard at some point. [card]Damnation[/card] seems like a good possibility in this category.

Let’s take it to the extreme, just for fun. [card]Wasteland[/card] was left out of Vintage Masters for a reason, but you can be sure Wizards is going to cash in on this gem. Is it crazy to consider the Standard implications? If it is ever going to be viable, a Standard where the best mana-fixing involves fetching basic lands would be the place. [card]Wasteland[/card] would keep all the rest of the duals from Khans in check while allowing fetches to do their thing.

I’m sure the chances of [card]Wasteland[/card] in Standard are very small. The point here is that Wizards will surely consider it because that is the highest payout. They will probably conclude that it is too powerful and put it in a Commander product at some point (or something along those lines).

Reprint Sets

If Wizards can’t put a card through Standard, the next best option is a reprint set like Modern Masters, Vintage Masters, or Conspiracy (I realize that set had some new cards).

Reprint sets are great for Wizards for a few reasons. The first is that a draftable set appeals to some people on that basis alone, widening the audience. In other words, you don’t have to play Modern Constructed or care about the reprints at all to enjoy Modern Masters. Very enfranchised players that wouldn’t pay much attention to a product like Planechase dive right into these reprint sets. These sets (although not Conspiracy), also have a nice synergy with Magic Online.

The next reason is that reprint sets are a much less efficient way for players to get the reprints they need. If [card]Tarmogoyf[/card] was in a Commander deck, essentially anyone could buy a ‘Goyf at $30 retail. Instead, it was a mythic rare in Modern Masters, so it appeared in one out of every 120 packs (one mythic in every eight packs, with one-in-fifteen shot at that mythic being a [card]Tarmogoyf[/card]).

Did I mention reprint sets are great for Wizards because they can charge $7 per pack?

On average, Wizards booked $840 of sales of Modern Masters packs for each [card]Tarmogoyf[/card] put into circulation. That’s a bit more than the $30 for Commander decks. This means that players have to dump a lot more money into their reprints in a reprint set.

The “special” rarity in Vintage Masters was born out of this very favorable math. I do not think we have seen the last of it.

The final reason that reprint sets are great for Wizards is that they are inexpensive to produce. They need zero designers, zero creative, and just a few developers to make the set out of existing pieces. This almost seems like the type of thing developers do in their free time, to be honest. Instead of dedicating most of your R&D team to making a new set for a year, you can throw Adam Prosak and Ian Duke in a conference room with a laptop, have them put together what is essentially a cube with rarities, and then sell the packs for twice as much as your current Standard set.

Vintage Masters had to be even more profitable than Modern Masters (on margin, surely it didn’t outsell it) because Wizards didn’t even have to print physical cards!

I expect that we will see a draftable supplemental product virtually every year going forward. These sets will be all or mostly reprints. As long as a card has significant equity in the secondary market, I think Wizards will include it (unless they are printing it somewhere else). So I’m predicting [card]Tarmogoyf[/card] and [card]Dark Confidant[/card] in Modern Masters II. I also expect that Wizards will experiment with stretching rarities even further in paper products. I’m not sure if the company will decide that Modern Masters II is the right time to try it, but it is a great way to preserve equity for future reprint sets.

Finally, I want to point out that none of these strategies work unless you have product on the shelves. This may already be obvious, but I strongly feel that we have seen the last of the ultra-limited print run. Any demand that goes unsatisfied due to a limited print-run just creates equity in the secondary market. Wizards is trying to harvest that equity, not create more.

I expect Modern Masters II to be quite a bit easier to get than the first one. From the Vault sets and Commander decks are already much easier to get then they used to be, and I doubt we’ll see another attempt at a Commander’s Arsenal.

I wouldn’t rule out a straight reprint of the original Modern Masters in the new frame at some point, either. We see this thought process in action already with the Duel Deck Anthology. If there is still demand out there for the first set (and $400 booster boxes indicate there is) and the set was already all reprints, why the heck not? Of course, I would revise my prediction of ‘Goyf and Bob being in the second set if the first one is scheduled to hit the market again.

In Closing

That’s my take on the Wizards of the Coast reprint strategy. If the reception to this article is reasonably good, I will probably write a similar article for Magic Online. Let me know if you are interested in that.

Thanks for reading.

Negotiating in Magic Finance

Improving your negotiation skills is a great way to level up at Magic finance. The ability to make better deals, even just slightly better, will pay huge dividends over time because you can use it again and again. Today I’m going to talk about keys to successful negotiation at the dealer booths and trade tables.

A Common Mistake

The most common negotiating mistake that I see is confusing the type of negotiation one is involved in. For our purposes, there are two types. The first is a forced-action negotiation. This is where a deal must be reached by some deadline. It’s the “ticking time bomb” or “gun to the head” scenario. These types of negotiations lend themselves to hard-line tactics, eleventh-hour deals, and so on. Every negotiation you see on TV or in the movies is this kind.

Forced-action negotiations are often win-lose by nature (meaning one party gets what they want and one doesn’t). Since a deal must be met, the negotiating parties jockey until one is able to force the other to take less.

You are never in a forced-action negotiation when dealing Magic cards. This is super important.

A lot of people think that all negotiations are forced-action and act accordingly. That’s just wrong. All Magic negotiations are voluntary-deal negotiations, the second type. Either party can get up and walk away at any point for any reason or no reason at all. Don’t forget it.

If you try to use forced-action techniques in a voluntary-deal negotiation, the other guy will get up and walk away more often than not. A hard-line approach usually just signals to the other party to move along.

Think about it: if you go into a negotiation thinking you are going to “win,” that means the other guy is losing. Why would the other guy make a losing deal with you?

In order to be a good negotiator in the realm of Magic finance, you have to master the win-win negotiation.

Let’s Make A Deal

The truth is that working with a good negotiator is easy, not hard. You walk away happy and generally feel that the deal was fair, not like he forced you into a bad trade. The reason for this is simple: a good negotiator will give you what you want. He does this because giving you what you want is the easiest way for him to get what he wants. That’s the essence of a win-win negotiation.

It isn’t about forcing the counterparty to take less. It’s about finding an arrangement that makes both parties happy. At its core, it’s problem solving—maximizing value under the constraints presented by you and your trading partner. How can you make a deal that works for both of you?

Approaching negotiation like this will lead to more efficient transactions and a higher volume of completed deals. Below, I’m going to cover what I think are the most important elements of win-win negotiating.

Discrepancies in Valuation

You need to find something he wants more than you and exchange it for something you want more than him. Ultimately, all deals are born of this.

If you played Magic as a kid and think back to that time, it’s clear—you traded the dragons to the guy who loved dragons, the angels to the guy who loved angels, etc. Everyone decided how they valued these things based on their personal preferences. The fact that everyone was different led to discrepancies in valuations and lots of trades. Generally, people went home happy.

shivan archangel

It’s a bit more complex in the Magic finance world, but you still want to have this mindset. You have to understand how you value things and then you have to find out how he values things. I don’t have enough space in this article to talk about how to properly value your own cards (beyond a price guide), but you need to have a handle on it. If someone asks you what you want for any card in your trade binder, you ought to have an answer.

Valuing your own cards is the easy half of that equation, anyway. The challenge in negotiating is figuring out how a stranger values his cards in the span of a few minutes. If you can do that, the rest is just connecting the dots.

Learning About the Counterparty

Stop and think for a minute about trading with the guy who doesn’t bother to understand how you value cards. This is the guy who keeps trying to trade you the [card]Jace, Living Guildpact[/card] he just cracked even though you told him you only play Modern. This is the guy who keeps asking for cards out of your current PTQ deck, or who keeps trying to trade his Standard cards into your dual lands despite the fact that you told him you only trade Legacy for Legacy.

Trading with this guy is painful at best and impossible at worst. He definitely knows what he wants, but he doesn’t seem to care what you want or how you value cards.

This is the exact opposite of a good negotiator. A good negotiator finds out what the other person wants and finds a way to make that happen while capturing value for himself. But it’s not as simple as sitting down and saying, “Tell me all the things you overvalue so I can trade them to you.”

Good negotiation starts with understanding your partner. What do you know about him, if anything, prior to coming to the table? Is he a casual player, a grinder, a speculator, a dealer? What formats does he play? Why is he here today? What is he trying to accomplish at the table?

Ask. The goal is to give him what he wants, so you should find out what that is. Don’t interrogate the guy, just start up a casual conversation. Flipping through binders in silence is a very inefficient way to find out. As you collect information, start connecting it to the cards in your binder.

Knowing the basics about the other person is a good start, but you’re not there yet. “I play EDH,” doesn’t immediately tell you what you should offer. You need to dig deeper.

Understand Cost Structure

This is where you will make your money as a negotiator. You already understand who you are dealing with and why he is here. If you can figure out his financial motivation, you can make an offer that will be hard to refuse.

Let me start with an example. A few months ago, Travis Allen wrote a great article about the costs associated with speculating. In summary: Travis bought 37 copies of [card]Ghave, Guru of Spores[/card] at $3.35 cash and while the TCG-mid price went to $10, the buylist was still only $5 which didn’t net him much money after shipping.

Ghave has dipped a little since then but I want to use these numbers, so just imagine you bumped into Travis the day after he wrote that article. You want a few copies of Ghave for yourself and for trade fodder and know the price is now $10 TCG-mid. One way to approach it is to hand him your binder and ask him to take a look, but you can do better.

If you had read Travis’s article, you would have known that Ghave was a spec that didn’t quite pan out for him. You would also know that he isn’t really trying to trade his Ghaves, he would much prefer to sell to a buylist and get his cash out. You also know what he paid and what buylists are offering.

You now have enough information at your disposal to make an offer that gives both you and Travis what you want.

You can offer Travis, say, $6.50 cash each on eight copies, and reasonably expect him to take it. Why? Because he approximately doubles up in cash on those copies while avoiding shipping charges, and substantially reduces the money he has tied up in Ghaves. That’s what he wants.


For your work, you get your Ghaves for $6.50 instead of whatever the dealers are charging now (say, $9) and can go trade them out to your friends at $10 TCG-mid. That is value for both of you.

Deals like this are there all the time and people constantly miss them because they aren’t digging deep enough. This deal happened because you knew more than what Travis had in his binder, but how it got there, why it was there, how much he paid, etc.

It’s an easy one because the article told us everything. Your ability to make these deals in real life depends on how good you are at extracting those details. If you ask the right questions, you can get there.

One more example and then I’ll wrap up. You are at a tournament and you have two [card]Nissa, Worldwaker[/card]s that you are particularly eager to unload, so you go over to the dealer table to see what he is offering. He makes a very strong offer, much better than you were expecting. You can happily accept and walk away, but why not take a minute to talk to the dealer?

There could be lots of reasons for offering a great buy price on Nissa, and some of them are opportunities for you. Maybe it turns out that business was super slow for the dealer today. He was looking to scoop up a lot of inventory but it didn’t happen. He’s offering good prices as the event winds down to get whatever is left for sale in the room.

What does this dealer want and how can you do business with him? He wants inventory, he wants to put his money to work, and he wants to do that today so the money he spent on his booth isn’t wasted. Can you help him out? If you can get him the stock he wants, he’ll pay you well for your effort.

Maybe you pull out your Legacy collection. You didn’t come to the table to sell that, but now you have a chance to negotiate a sale at a premium over normal buylist prices. If it’s not your collection, maybe you call a friend who has a lot to sell (you can negotiate a finder’s fee later). Maybe you can’t help him at all, but at least you know for sure.

Negotiation is about finding the deal, and that is much easier when you understand the costs on the other side of the table. I promise you will make deals this way that you would never find through the iterative process of, “How about if I throw X in instead?”


Rethink Your Strategy

If you still have the “how can I win this deal?” mindset, I strongly recommend giving this approach a try. Mastering the win-win negotiation style will bring easier deals, more deals, and much better value in the long run.

That’s all I have for today. If you have any questions, find me on Twitter at @acmtg or here in the comment section. Thanks for reading.

Magic and Personal Finance

How do Magic finance and personal finance fit together? I haven’t seen too much written on the subject, but I think it’s worth discussion. Personal finance is incredibly important to success in life, so the degree to which Magic finance can aid or derail you along the way is very relevant.

I’ve seen people engage with Magic finance different ways. Some in the Magic finance community come from finance backgrounds, or at least have a strong interest in it. These people usually take a sophisticated approach and use their general finance knowledge to educate Magic decisions.

I’ve also seen people with no apparent knowledge of finance or economics dive into Magic finance. If they are disciplined enough to keep their monetary commitment small, Magic is as good a place as any to learn the basics. If they lack that discipline, Magic can very easily get tangled with personal finance and lead to major problems. This may be a kid’s game, but we are often talking about adult money.

Magic demographics don’t help—the majority of Magic players I encounter are in their twenties or thirties. This is exactly the time to be developing your personal finance goals and executing on your plans, and Magic can be a distraction. I feel it would be less of an issue if most Magic players were, say, in their fifties and much further along in their personal finance journey.

Indeed, my biggest worry is that some people are unwittingly overexposed to Magic under the guise of “investing” at a time in their lives when this can really compromise personal finance goals. I realize that there is a lot to talk about relating to Magic and personal finance, but today I’m going to talk specifically about this aspect of it.

The Holy Grail Test

Let’s start with a hypothetical situation to get us thinking. Imagine you have a near-mint Alpha set. This set is your golden ticket—you are planning to hold it until the time is right, then sell it for something important like a house or to pay for your kid’s college or your retirement.

It’s a great investment, right?

Here’s the catch. The set is locked up in a vault and you can’t get it out. You can’t see it, can’t touch it, can’t display the cards, can’t take pictures to show off to your friends, can’t put any of the cards in your cube or build a Vintage deck, nothing. The set condition has been verified, but essentially all you have is a certificate of ownership similar to a stock certificate. The Alpha set is completely intangible to you.

How much less interested are you in owning this Alpha set now that you can’t enjoy it?

You might be thinking, “If I can’t even look at it, what’s the point? I’d rather dump it and buy/invest in something else with that money.”

Or you might be thinking, “I’m retiring early off that set whether or not I ever lay eyes on it. I’ll frame the certificate in the meantime.”

There is no right answer, of course. The purpose of the exercise is to get you to think honestly about how you view the set as a real investment, detached from the personal value you place on owning Magic’s holy grail.

Would your opinion of owning an Alpha set as an investment change substantially if you didn’t have physical possession of it? Would you keep it if you had possession, but be willing to let it go if your only connection was the deed? If all you had was a piece of paper, would you rather just own some Apple stock?

Remember, you don’t play with an investment. Your investments don’t provide entertainment. You don’t show your investments off at the card shop, and you certainly don’t develop a deep personal attachment to an investment (if you are smart).

As Magic players and financiers, we often want to have it both ways. We want to believe that an Alpha set (or whatever item in question) is a great investment and that we can display it and enjoy it every day. We want it to be something we love and a smart decision.

If having possession of the set would influence your decision to any degree, you are thinking at least partially with your heart. That’s a bad thing when it comes to investing.

It is very, very hard to look at something like this objectively. A near-mint Alpha set might be literally the coolest thing on the planet to own for many people reading this article, and for me too. We would all value it very highly from a personal perspective. It would bring us great happiness and pride. Very few of us can afford an item like this, but all of us would love to own it.

In truth, very few of us can afford something like that as part of our hobby. Many more of us can afford something like that as an investment. Funds are much more likely to be available for investments than they are for hobbies—you didn’t save all that money for nothing. Thus, for many, the obstacle to owning something awesome is not coming up with the money, but justifying it as an investment. I can certainly come up with $5,000 for a [card]Black Lotus[/card] if it’s an investment.

Now take a look at your collection. You probably don’t own a near-mint Alpha set, but many people own some number of “high end” Magic cards. Did you, at any point, justify the purchase of some of your cards by saying that they would be good investments? Maybe this is what convinced you to jump into Legacy, or to plow a bunch of money into Reserved List cards. You’ll get to play Legacy and by the time you are done, you’ll make some money too, right? This logic conveniently gave you access to your savings and not just the hobby money you set aside this month.

Ask yourself: Would I be willing to lock my Legacy deck away in the same way as the Alpha set? If it really was an investment, you should be able to do that. Again, we don’t play with investments. Heck, if it was really an investment, you should want to lock away your Legacy deck to protect it. The last thing you want is to damage it.

The truth is that virtually no one buys Magic cards purely for investment reasons without placing at least some personal value on them. We love this game and can’t deny it.

Where is the line?

The Magic Finance Trap

What does it matter if your cards are investments or not? So you sprung for a Beta [card]Black Lotus[/card]. You wanted it, saved for it, and bought it. It’s your money, and it is a good investment, in your opinion.

Let’s back up for a minute. To start, you should have a personal finance plan. If you don’t, go see a financial planner and figure that out immediately. It’s very important to your success and happiness in life.

Next, check to see if the Beta Lotus is in your personal finance plan. Oh, it’s not?

Things that derail you from your personal finance plan are very dangerous. Seemingly small lapses now can have large cumulative effects over time and can prevent you from achieving your long-term goals.

The path to retirement that you laid out, with or without a financial planner, almost certainly does not include high-end collectibles. Most likely, your financial plan requires you to save money at a certain rate and then invest that money into an age-appropriate mix of stocks and bonds while keeping enough cash on hand for things that might come up.

You fall into the Magic finance trap when you stop executing on your personal finance plan so that you can participate in Magic finance (or even just Magic the game). There is nothing wrong with owning a Black Lotus by itself. The issue is that if you are in your twenties or thirties, spending $5,000 of savings on a Magic card (or on a bunch of specs) might hurt your long-term financial goals more than you realize. If you are in your fifties and financially secure, buy your Lotus, buy your Jaguar convertible, buy whatever you want.

Don’t get me wrong, I’m not saying Magic finance isn’t profitable. I’m not saying the Lotus or other specs won’t appreciate in value. I’m not arguing that stocks and bonds will give you better returns. And I’m not saying you don’t know what you are doing.

I’m saying it’s not part of the typical plan. A financial plan is created to get you where you want to go in life with as much certainty as possible. It is designed to get you an average annual return that will allow you to retire on time. The investment mix is chosen to give you the mix of growth and stability that you need.

How does a Lotus change the retirement equation? What is the expected average annual return on Beta power over the next 30 years? I have no earthly idea and honestly, neither do you. By diverting any significant amount of savings toward Magic, you are factoring a big fat question mark into your retirement equation. I’m guessing that’s not something you want to do.

Your Magic Number

How much of your personal wealth do you have committed to Magic or Magic finance? I’m talking about anything you put significant monetary resources into. That might include your cube, your Legacy deck, your Modern collection, your specs, etc.

Do this calculation: Total up all your savings and investments (forget debt for now) and divide it by the total cash value of your entire Magic portfolio (as described in the last paragraph). It can be a rough estimate—no need to go checking buylists on every card. This ratio is going to tell you how many dollars you have saved for each dollar of Magic cards you own. Please don’t post your number or share it with anyone.

I bet if we plotted the results, one data point for every reader of this article, they would be all over the chart.

For some, the number would be huge. These people have big savings and modest Magic collections. Their magic numbers would be 25, 50, maybe 100+. To clarify, a ratio of 25 might mean that I have $25,000 in savings compared to a $1,000 collection.

For some, the number would be lower, maybe even close to one. Their collections rival their entire non-Magic savings. This could be a young person with $10,000 saved up and $10,000 in Magic stock, or it could be an older, high-end collector with $100,000 in investments and $100,000 in Beta power.

For the grinder in his early twenties who scraped together everything he had to buy a Legacy deck to play the SCG circuit, his number might be approaching zero. He has a $4,000 Legacy deck but his biggest problem is finding gas money to get to the next event because his checking account is empty.

There is no right answer—but I think there are some wrong ones. If your ratio is very low, say if you are the grinder in the above example, you really can’t afford to be doing what you are doing. The higher the ratio, the less money you have tied up in Magic and the easier it will be for you to succeed in personal finance using conventional means. Wherever you stand, increasing this ratio is a good goal to have. That means you are increasing savings faster than your Magic collection.

It’s valuable just to know where you stand. Consider it a victory if you had a pretty good idea what your ratio would be prior to doing the math. Worst case is you had no idea how deep you were into Magic and just got blindsided.

There is going to be a group of people reading this article who feel like it doesn’t apply to them because they know better. Some of them are wrong, some of them are right. “It’s okay that I have most of my money tied up in Magic because…” seems like a risky line to take, but maybe you know what you are doing.

There is plenty more to be said about Magic and personal finance. This article attempted to help you answer only one high-level question: “Am I in over my head?” If there is interest, I will write more on the subject.

Find me on Twitter at @acmtg or leave a comment here at BSB.

Thanks for reading.

A Bearish Outlook for Magic Speculation

After my unexpected month-long vacation from writing, I thought a macro article would be a good way to start again. Today I’m going to explain why I think it will be difficult to make money speculating on Magic in the future.

I’m using the term “speculation” here to mean buying cards you believe will increase in price at retail and then selling them at the new higher price if/when that price is achieved. Successful speculation is dependent on the retail price of a card increasing substantially (you need around 20% just to cover fees).

This is the type of thing that many of us do on the side, not to be confused with what stores do. Stores buy cards at buylist prices and sell at retail, which is a model that will always be viable and does not depend on increasing card prices.

The pillar that has been propping up Magic speculation for the last few years is the general upward movement in Magic card prices. The influx of new players (and their money) has consistently pushed card prices higher over this time period. Those with some insight into the game were able to pick the cards that benefited most, but just about everything was a reasonably good buy five years ago.

I’m starting to see cracks in this pillar, though. Here are my concerns.


1. Wizards is catching up on reprints.

Two years ago, Wizards was woefully unprepared for the success of the Modern format. They clearly did not have a plan to get more copies of key Modern cards into circulation when they created the format. After three years, it appears that they are finally getting their feet under them.

Yes, it is laughable that we still don’t have fetchlands, but all signs point to that being corrected as soon as this fall (the omission of Onslaught fetchlands from Vintage Masters is telling).

Fetches aside, we now see a more aggressive reprint plan coming to fruition. Modern Masters was a big first step and the consensus is that we will see the sequel next summer. Wizards has replaced half-hearted casual Core Set reprints like [card]Nantuko Shade[/card] and [card]Serra Avatar[/card] with Modern relevant cards like [card]Mutavault[/card] and [card]Scavenging Ooze[/card]. This year, [card]Chord of Calling[/card] and [card]Urborg, Tomb of Yawgmoth[/card] continue the trend. The previous two fall sets have also featured reprinted Modern staples in the shocklands and [card]Thoughtseize[/card], and I expect to see more of these in the future.

On top of this, Wizards has more supplemental product than ever. The now-annual Commander product is perfect for reprints because there are no format, balance, or even thematic concerns. You can drop literally anything into those decks. We also can’t forget about Duel Decks, we did just get a [card]Remand[/card] reprint there.

Even Legacy got some reprint love this year between Conspiracy and the [card]Jace, the Mind Sculptor[/card] reprint in From the Vault.

Wow, that’s a lot of reprint outlets. Can you think of anything reprintable that wouldn’t fit in at least one of those products? No, neither can I.

The increased threat of reprint makes speculation a lot trickier. If you are good at predicting the Standard meta you will always have that, but holding Modern and Commander cards is now substantially riskier. Cards like [card]Abrupt Decay[/card] and [card]Sphinx’s Revelation[/card] – cards that I would normally be loading up on during rotation – could very well end up in Modern Masters II (or a Duel Deck, Commander deck, etc.) in the next 18 months. As a speculator, I can’t be sure that is enough time for the cards to appreciate.

It’s a risk I’m not sure I’m willing to take. Picking winners is hard enough without having to dodge the barrage of reprints.


2. The market is being flooded with new products.

Not flooded as in overly large print runs, but as in a huge number of new products.

Journey into Nyx, Conspiracy, Vintage Masters, M15, Commander 2014, From the Vault: Annihilation and Khans of Tarkir are all going to hit in a 6 month span. I’m not complaining about this, I think it is great, but that is a ton of new product. The finance issue is that there is only so much money to go around and these new products are going to suck up a lot of the money that might have gone into the secondary market in the past.

It’s even more concerning when you combine this with the reprint issue. Players usually have to choose between buying cards on the secondary market and buying new product. If the new product includes reprints of the cards they need anyway, there is no decision. Why buy [card]Stifle[/card]s from a store when you can draft Conspiracy and probably end up with one?

All this cash being diverted to new product is going to make it harder for cards to maintain their prices in the secondary market.

Magic Online offers a great illustration. Standard prices tanked when Vintage Masters came out. Why? Because people wanted to play VM and needed to sell Standard cards to raise the money to do that. I know the upcoming client switch is playing a factor, but there’s just not enough money to go around.

From Wizards perspective, this is not cannibalization. The new products are not fighting with each other for money (well, they are to some degree) as much as they are fighting with the secondary market for money. Wizards makes zero dollars when an Onslaught [card]Polluted Delta[/card] gets sold at an LGS. They are going to make a boatload of dollars when people are furiously cracking Khans packs in search of [card]Polluted Delta[/card]s (I think). This is a great strategy for Wizards and I’m not sure why it took them so long to cash in on their assets. Speculators, unfortunately, don’t get a cut of any of this.


3. There are no new formats on the horizon.

One of the biggest drivers of secondary market prices over the past few years has been the rise in popularity of new formats, specifically Modern and Commander. When these formats started gaining momentum, it prompted players to go out and buy a lot of cards they would not have otherwise bought.

Most people have their Commander and Modern cards by this time or have consciously decided not to play those formats. Now what? Sure, the continued growth of the player base will put some upward pressure on card prices (barring reprints), but we’re talking 30% annual player growth in a good year. Speculators are dependent on cards doubling (that’s 100% growth, kids) in much shorter time periods.

The days of pulling formerly-bulk rares that are now $20 out of your collection may be behind us unless something new comes along. I don’t see it yet.


What Now?

The market has stabilized quite a bit. This is good for players, but the problem for financiers is that we have been living on market volatility for the past two years.

As I said, Standard speculation is still a fine place to be if you are good at it. It was never a good place to be if you aren’t. As for Modern, I expect a pretty quiet year. Shocks to the system (surprise reprints, bannings and unbannings, new cards that impact the format) will still be important, but I think there will be far fewer cards spiking out of seemingly nowhere. Holding Modern cards is becoming increasingly risky and less likely to pay off. I’m drawing my stock down.

Reserved List cards are an option, but I’m not sold. People perceive the Reserved List as a “flight to quality,” but I’m not sure they are right. That’s another article.

Sealed product is going to be hit as well. The baseline price for sealed product is always the expected value of the cards inside, and reprints hurt that. There is a draft premium, but there are literally three current draft formats I want to be playing right now (Theros block, Vintage Masters, Conspiracy) with M15 on the way, so why would I pay $160 for a box of Innistrad? Why would I pay $400 for a box of Modern Masters when I can play Vintage Masters now or just wait for Modern Masters II next year?

It looks to me like most of the easy money is made. I remember thinking in the middle of all those Modern spikes, “this has got to stop.” Well, it has.

Thanks for reading.

Bargain Hunting On MTGO

There are some great bargains on MTGO right now.

I usually write articles about strategy or trends because I think they are most valuable and because there are a lot of writers who do a better job picking cards than I can. Still, every now and then I see enough opportunity somewhere to make me want to write a card-picking article. So here you go.

MTGO prices are depressed right now. I think there are a few things at play.

  • The MTGO PTQ season, which was supposed to be Modern, was canceled.
  • Standard is moving toward rotation, so you have that normal downward trend.
  • There may be some lingering effects from the last round of flashback drafts.
  • People may be raising cash in anticipation of Conspiracy in paper and Vintage Masters on MTGO.
  • The Beta Spotlight was not well received from what I saw. Fear may be a factor:


Whatever nasty mixture of the above factors is causing it, the situation is a good buying opportunity.

We’re looking for low-risk cards that will allow us to double our money or better. Here are the two main criteria:

  • Established cards. We’re not speculating in the sense of buying cards that haven’t yet broken out or might be good next Standard. We don’t need to do that because there are enough good deals on already established cards. We’re looking for cards that are already Constructed playable and preferably have homes in real decks. [card]Prognostic Sphinx[/card] might be a good speculation target, but it’s not what I’m after here because we don’t know for sure that it will impact Standard.
  • Undervalued cards. We’re looking for cards that have come down substantially from their highs without good reason. This doesn’t mean cards with “room to run” in the sense that they can go even higher than they are now ([card]Courser of Kruphix[/card], for example). There’s not enough upside there. It also doesn’t mean cards that have dropped for good reason, like [card]Force of Will[/card] (upcoming Vintage Masters reprint). I don’t know what the bottom on MTGO Force is and I have no interest in being anywhere near it when it becomes clear.

We’re looking for cards that will turn us a tidy profit just for getting back to their previous price and carry very little risk.

We’re looking for graphs like this:


[card]Darkslick Shores[/card] has lost over half its value in the last month.  It’s been at 1.5 tix recently and above it previously. This is exactly the kind of card I want to be buying. It’s virtually a guaranteed double-up with very little risk and it shouldn’t take that long, either. Check the other fast lands, as well. All of them but [card]Razorverge Thicket[/card] are buys, in my opinion. In fact, [card]Seachrome Coast[/card] is 0.37 tix right now.

That’s one. I’ll give you handful, but you should be able to find plenty more yourself. In general, you are looking for rares or uncommons because mythics tend to hold their value better. Also keep in mind that prices bounce quite a bit on MTGO. By the time you read this, the prices will have all changed at least a little. Maybe that works in your favor, maybe some of these cards run away before you have a chance to buy.

Next, [card]Gavony Township[/card] is played in Pod and has lost about 75% of it’s value in two months. It’s getting pretty close to bulk and there is no way it stays there.

While we’re on this card, let me give you a tip. When you are buying very inexpensive cards like this, you run into the “less than a ticket” issue. It pays to use bot chains here because you can share credit across them, picking up a set of Townships from each of the bots in the chain (until they cap you).

When selling, don’t get greedy. As you can see from these charts, prices bounce up and down like crazy on cards like this. There are no transaction costs and you will surely have another chance to buy, so you don’t need to hold on for the absolute highest price. Any time you can package cards for an even number of tickets and make a decent return it’s a fine idea to go ahead and do so. If you buy at 0.16 tix and sell them 3-for-1-tix, you’ve still doubled up and walk away with full tickets.

[card]Tectonic Edge[/card] is a card I always keep my eye on. I’ve ridden the peaks and valleys on it more than once, buying as low as 0.25 tix and selling for a buck. It is holding at 0.61 tix right now.


It’s not only Modern cards, either. [card]Temple of Abandon[/card] is about at an all-time low. The Temples will either be the best or second best set of duals in the new Standard, and either one of those things means it is too cheap. The UG, BW, and RB (Born of the Gods) Temples are also under one ticket right now.


[card]Scavenging Ooze[/card] is closing in on its all-time low. No need to get greedy with this Modern powerhouse and wait for a bottom, in my opinion. It’s already a great buy. Same with [card]Deathrite Shaman[/card]. They might drop a bit more as rotation gets closer, but they might not. Getting Ooze at 4.5 tix is just great.


Last one. [card]Chandra, Pyromaster[/card], is at an all-time-low-since-we-knew-it-was-good. This card showed up in the finals of the Modern Grand Prix less than two weeks ago, guys. Is it getting reprinted in M15? Almost certainly. [card]Garruk, Primal Hunter[/card] hit 20 tix in its second printing, and [card]Jace, Memory Adept[/card] hit 15 in its second run.


No big takeaways from this week’s article other than this one: there is a ton of value to be had on MTGO right now. You will find plenty of great buys other than the ones I’ve listed if you look around. Good luck!

Thanks for reading. Find me on Twitter, @acmtg, or leave a comment below.

Rotation: How Soon is Now?

There are a number of basic concepts that you learn when starting in Magic finance. These are the building blocks that make Magic finance predictable enough to be profitablethe fundamentals that dictate supply and demand. I’m talking about things like rarity, big set versus small set, draft pack ratios, scarcity of older sets, and rotation. I’ve always thought rotation was the most tenuous of these. Why? There’s just not enough data. Rotation happens only once a year and Magic finance, in it’s current form, hasn’t been around that long. Truthfully, how many rotations have you been through where you were totally focused on the financial ramifications? For most people, it’s less than a handful, or maybe just one or two. Sure, there are store owners and dealers who have been doing this for ten years or more, but the Magic economy, and thus rotation, has changed drastically over that time. It continues to change every year. It’s always prudent to question conventional wisdom. Rotation is not some kind of immutable truth. It’s an event that happens once a year. Unless you think Magic in 2014 is exactly the same as it was last year or the year before or in 2010, you should be challenging the assumptions that are based on those data points.

The Modern Era

Modern has only existed through three rotations. It’s impossible to have more experience with the format than that. Pre-Modern rotation trends are not nearly as valuable as they once were. Of those three rotations, the first one is almost a mulligan because it happened two months after the format was introduced (with Zendikar block rotating out). It was far from certain that the format was even a real thing at that point. So really, all we have to go on is last year and the year before. That’s it. Most of what we assume about rotation this year is based on two data points. In a lot of cases, those two data points don’t even agree with each other. When Scars of Mirrodin block rotated in 2012, the prevailing theory seemed to be that Modern would mirror Extended when it came to rotation. The cards would drop in price when they left Standard, jump back up when Modern season came around, and then drop again when the season was over. How did that work out? Last year, when Innistrad rotated out of Standard, the theme seemed to be “Won’t Get Fooled Again.” [cardLiliana of the Veil[/card] made a mockery of the whole idea of rotation. Not only did the card fail to drop even a little bit, it has increased around 50% in the year since rotation. [card]Snapcaster Mage[/card] and [card]Geist of Saint Traft[/card] weren’t quite as resilient as Lilly, but they never got super cheap and certainly didn’t afford us long windows to get in. Two Modern rotations, two critically different outcomes.

Don’t Get Comfortable

If you assumed that Innistrad cards would behave the same as Scars cards when they rotated, you probably got burned. It took [card]Batterskull[/card] almost 18 months to get back to $25. It took Geist five months. I know I thought I had a lot more time to pick up Innistrad block staples, and I missed quite a few as a result. Let’s not make that mistake again this year. Return to Ravnica block is not going to behave exactly the same as Innistrad block. It’s certainly not going to behave the same as Scars block, or Zendikar block, or anything before it. Throw out conventional wisdom on rotation. I see a lot of opinions like this on Twitter and Reddit: “Shock lands will probably dip modestly over the summer before moving steadily upward starting early next year.”  That’s copy-and-paste logic from years past. I’m not saying it can’t turn out that way, just that we shouldn’t assume it because that’s what would happen if this was 2011. Getting it right this year is going to take real analysis. It’s not going to be as easy as saying “it will probably look the same as last year except the timeline will be moved up a month or two.” If that seems like an oversimplification, it is. The truth is that every rotation is different and conventional wisdom may or may not apply. We need to roll up our sleeves and figure it out. So let’s do it. We’ll start by asking ourselves two questions. What is different about rotation this year? How do those things change our approach?

RTR Rotation: What’s Different?

Quite a bit, actually.

  • Return to Ravnica had a weird block structure. This matters in a few ways. There is less Return to Ravnica out there than the usual first set and more Gatecrash out there than the usual second set.  Check out my article here for more info on draft ratios. This is interesting because most of the good Modern cards in this block (other than shock lands) are coming out of RTR and not GTC. Will we see more upward pressure on RTR cards than we did with Innistrad? I don’t know, but I’ll make sure I’m ready to jump if we do.
  • This block doesn’t have a format-defining Modern card. Well it did, but they banned it. Innistrad had both [card]Liliana of the Veil[/card] and [card]Snapcaster Mage[/card]. These were already two of the best cards in Modern when the set rotated, and that brought a lot of attention to their price movement. RTR has plenty of good Modern cards, but now that [card]Deathrite Shaman[/card] is gone, it doesn’t have that high-profile Modern headliner (other than shocks, but see my next bullet). It is possible that this entire block slides under the radar somewhat when it rotates, which might give us a longer window to buy. Might.
  • There were Modern-relevant reprints in a Standard set for the first time. The shock lands were significant for this reason. Don’t overlook that the Modern powerhouses of Innistrad and previous blocks were all originals. How does this change things? Well, you have to think that the market is pricing shock lands pretty efficiently. From the first day RTR hit the shelves, everyone knew that they needed a set of 40 shocks to hold if they had any interest in Modern at all. It has been clear for a long time exactly how good they are in Modern. For that reason, I’m really not sure if there will be any movement at all when these things rotate. That means I’m not waiting around to find outwhen I see a price I like, I’m a buyer of shock lands.
  • There were Modern-specific designs in this block. The Extended format was mostly just thatan extension of Standard. If a card or deck was very good in Standard, it had a shot to hang around. [card]Deathrite Shaman[/card] was a game-changer in that regard, the poster child for Modern-specific design. It was invisible in Standard but was awesome in Modern (too awesome, I guess). There are actually lots of cards like this in RTR block if you look. [card]Abrupt Decay[/card] is pretty obvious, but don’t forget about stuff like [card]Rest In Peace[/card] and [card]Counterflux[/card]. These cards were never big players in Standard (well, [card]Abrupt Decay[/card] was at least relevant) but definitely see Modern and sometimes Legacy play. They are going to behave differently than cards that were also good in Standard. If there was never any Standard demand to begin with, can we really expect the price to drop when these cards rotate? I don’t think so. So when is a good time to start buying? Now sounds about right. We already missed the boat on foils.
  • Dragon’s Maze was unpopular and was overshadowed by Modern Masters. I’m not saying there is anything from Dragon’s Maze you would actually want, but if there was, the supply would be tight. New Phyrexia was an insane set, but DGM was nothing of the sort. I still don’t think it’s totally clear whether [card]Voice of Resurgence[/card] is that good or whether the supply is just ridiculously small. The DGM supply situation is certainly relevant if something like [card]Beck // Call[/card] ever breaks out. It might be worth taking a flier on a cards like this or [card]Breaking // Entering[/card] for that reason.
  • Modern season is in the summer this year. Could this make rotating cards jump even before rotation? I actually have no idea what to think about this one. A big part of me believes that people are mostly stocked up on Modern after the rush last year, and also that people are going to want to go to the beach in the summer and not play Modern. I definitely don’t subscribe to the theory that everything is going to spike again just because Modern season is approaching. We will see.
  • This year can’t be as crazy as last year, right? We have to at least consider the possibility that last year’s Modern feeding frenzy was a one-time thing. If not one time, then a periodic thing but not directly tied to rotation. I’m not convinced it won’t happen again but understand that it won’t necessarily happen. Like I said above, you can’t take one data point and call it a trend.


My conclusion on rotation is simple. The days when we could definitively say “wait until July or August to buy” are over. The factors that made that good advice are no longer in place. It will be bad advice as often as good advice in the future.

There is a good chance shock lands bottomed three months ago. [card]Rest In Peace[/card] foils are $15. This is an article about rotation which will be published five months before it actually happens and it’s still too late on that stuff.

We’ll have to do this the old-fashioned way. When a card hits your buy price, buy. It doesn’t matter if it’s August or December or February. I don’t have all the answers, but I’m determined not to get blown out because I failed to see that this year was different.

Thanks for reading.

The View From 10,000 Feet

The popularity of Magic: The Gathering has exploded over the past few years.

There, I just taught you everything you need to know about Magic finance. I’m not kidding. Well, I’m sort of kidding.

The truth is that it’s been pretty easy to make money buying and selling Magic cards recently because the overall price level of cards has consistently risen. Modern cards have generally increased in price. Legacy cards have generally increased in price. Casual and/or Commander cards have generally increased in price. Standard cards bounce around for a while in the format and the playable ones eventually find their way into one of those groups and rise in price. So the basic strategy has been to buy Magic cards, wait until they go up, then sell them. Sure, some of the better speculators find cards that go up more or go up faster, but this basic approach works for mostly everyone. Don’t get me wrong, I’m not saying it’s impossible to lose money doing this. If you don’t understand transaction costs, don’t really understand Magic, or just don’t have decent business sense, I have no doubt you can fail at Magic finance. For the rest of us, though, buying good cards at reasonable prices is enough to stay in the black. You don’t have to be great at evaluating cards as long as you buy a good mix of stuff when you see good deals. Even reprintsformerly the most spectacular way to crash and burn on Magic specsdon’t seem that awful anymore. Modern Masters taught us that you’ll have to wait longer to cash out, but the ever-increasing player base will absorb the new copies just the same.

Macro View

It’s important to understand that all this is being caused by the larger upward trend in Magic’s popularity. We all felt like geniuses when our Modern specs started spiking last year until we realized that basically every Modern card was going to spike. It was about the larger trend of a format growing in popularity, not about the specific cards. The big picture at that point was that Modern was on fire. No other information needed. Playable Modern cards were either good, great, or amazing buys, even the ones that didn’t end up seeing much play. Again, some people did better than others, but the only real losers were the ones who didn’t play. Recognize the trend, jump in, profit. When you step back even further and get the 10,000-foot view, you realize that the most important call yet was not on a particular card, set, or even format, but on Magic as a whole. Sure, different sectors of Magic have jumped at different times. The Commander trend, the aforementioned Modern trend, the Legacy trend. But Magic taking off as a game was the trend that started all the other trends, and getting that call right has been, by far, the single biggest money-maker to date.

Flashback Time

Five years ago, Alara Reborn had just hit shelves. Magic finance wasn’t a thing (or it was just called “running a store”), and the new core set and Duels of the Planeswalkers were just getting ready to debut. American grands prix were starting to hit the 1,000-player mark consistently. All the ingredients were there. Hindsight is 20/20, but did you see it at the time? In all likelihood, you were just getting back into the game, oblivious to the fact that there were a million others just like you doing the exact same thing. If you could go back and talk to your 2009 self about Magic finance, what would you say? Sure, you could coach him up on specific cards that were in the pipelinetrade for fetches, pre-order [card]Jace, the Mind Sculptor[/card], find foil eldrazi, etc.but mostly you would just say, “Get as many Magic cards as you can. Get everything, and get a lot of it.” Is there really much that would have been a bad investment? Let me remind you that we live in a world where [card]Lord of Extinction[/card] is a $12 card. How about sealed product of pretty much any kind? Zendikar boxes? The Divine vs. Demonic Duel Deck that was just hitting shelves? All those soon-to-be Commander staples sitting in bulk boxes? No need to pretend that we could have foreseen $80 fetches since we would have been shoveling those into our binders along with everything else. Literally anything you could get your hands on at the time would turn out to be money well spent. Magic itself was a good investment. If you had your head buried in decklists and tournament reports, you may not have seen it happening around you. But if you had backed up and taken a broad look at the entirety of Magic, the 10,000-foot view, you may have seen surging tournament attendance, exciting new products, more powerful cards being printed, and renewed interest from old players. You may have noticed something was going on.

Take a Look Around

The question I want you to ask yourself is simply, “What’s going on with Magic right now?” I’m not asking what’s happened over the past six months or a year. I know Modern exploded in popularity. I know dual lands jumped in price. I have to chuckle whenever I see Magic financiers post something on Twitter like “don’t sell fetch lands yet, they are still going up and Modern season is this summer.” Thank you for the report. I’m asking what is going on right now, today, as we speak, in game shops, kitchens, and cafeterias all over. Wherever you were in 2009, did you know players were starting to flock to the game in record numbers? You probably missed it, even though you were right in the middle of it, because you were having so much fun that you forgot to look around. I did. Well, do you know what players are doing now? Are you again right in the middle of something and not seeing it? Are you looking? This isn’t the “pick a format that hasn’t spiked in a while and buy in” exercise. This is trying to understand the health and direction of the entire thing. And there is no answer in this article  because I don’t know for sure either. I’m writing to encourage you to spend time trying to figure it out. Do you think Magic has peaked? Why or why not? Are we just getting started, or somewhere in the middle? Do you have a good answer either way? If your default response is, “I think Magic is going to continue to increase in popularity because that’s what it’s been doing for the past few years,” you have some work to do. I’m not saying you are wrong, just that you are clearly guessing. If you have no idea, I suggest you start with Hasbro’s investor materials. Sure, it’s backward looking but it’s right from the horse’s mouth and they occasionally say something really interesting. Plus, with @time_elemental live-tweeting the earnings call, you have no excuse. On that subject, does this surprise you at all? timeelemental

There is a saying in financethey don’t ring a bell at the top. Magic could have peaked today for all we know. We wouldn’t notice it until it had declined somewhat. Any time you are at an all-time high, you are just one bad day away from having peaked. I don’t necessarily think that’s the case and I’m not trying to convince you of it here, but how are you planning to recognize this when it does happen? Then again, maybe this is only the beginning. Maybe Magic goes mainstream with the movie and the action figures and whatever else. Maybe the next generation grows up watching Adventures of the Planeswalkers on Saturday morning. We’ll look back and say, “This was about the time that 4,000 player GP’s started to happen more regularly.” If that is the case, it would be nice to figure it out now. So what would your 2019 self say to you about Magic finance today? Is it, “Get everything, and get a lot of it?” Or is it, “What was Magic finance?” There is a lot of money riding on the answer. Thanks for reading.

Inventory Management Part V: Strategy

Welcome to the fifth and final part of my Inventory Management series.

Last week I took a break to write about counterfeits, and I really appreciate all the feedback and conversation. I thought it was worth breaking up this series to get that article out faster.

Today we’re talking general inventory strategy and some miscellaneous closing thoughts thrown in for good measure. I’ve written quite a bit about inventory management over the past six weeks, so there won’t be too much heavy lifting in the final installment. You can find the first four articles below and you should read them before you continue if you haven’t already.

Part I: The Basics
Part II: Tracking
Part III: Turnover
Part IV: Sunk Cost

Aligning Your Business

The first four parts of this series covered some important inventory management concepts, but they were somewhat out of context. Now it is up to you to put them together and craft the inventory strategy that best supports your business.

Some things to consider:

How much capital do you have? When and how will you be selling cards? To whom? What are your overheads and total cash flow requirements? The answers to these questions will dictate what and how much you carry in inventory.

Store owners, for example, have much higher overheads than traveling traders or casual speculators. For a store owner, keeping the doors open (paying rent, bills, the employees, etc.) is the most important thing. Steady cash flow is absolutely critical so you need to move a certain amount of inventory each month just to keep going. That probably means plenty of sealed product as well as Standard and casual singles. Maybe you have a Modern crowd, maybe Legacy, maybe other games, but the point is that your overheads dictate reasonably good inventory turnover even if the margin isn’t as great as you would like.

Conversely, you may have a day job and deal cards out of your house on the side. You have plenty of cash but limited time to sell cards at tournaments or shops or even to list cards on eBay. This is definitely grounds for tilting your inventory back toward slower moving, higher returning items. If you have the cash, why not buy in to some duals or other Reserved List favorites? If the rent money is coming from somewhere else, you can afford to sit on them for as long as you need.

Remember, your inventory is there to support your sales, not dictate them. The goal is not buy a bunch of stuff and then try to figure out how to sell it. Instead, think about how you are going to sell and then buy inventory that compliments that approach. If all you do is buylist, then MP or HP Legacy staples are going to be tricky. Maybe try snapping up casual collections instead. You get the idea.

The Price Is Right

In Part IV, I talked about sunk cost. One of the takeaways there was that the buy decision is over and done with by the time you sell, and you shouldn’t let that influence you. What you can do is ensure that you are making solid buy decisions in the first place.

The majority of making good buy decisions boils down to one little word: price. Anything can be a good buy if you get it cheaply enough. Do your homework and put some effort into acquiring your inventory as inexpensively as possible. The art of finding a good deal will never die. Leave no stone unturned and work on your negotiation skills. When you do spot a good deal, don’t hesitate to pull the trigger (if you are doing it right you will have some cash on hand for this type of thing). Your future self will thank you when it comes time to sell.


It’s a basic concept, but it too often gets overlooked. Diversifying your inventory will take a significant amount of risk out of your operation. It’s going to do this in two ways.

1. If anything really bad happens, the damage will be limited in scope.

2. It will help smooth out the peaks and valleys in your sales.

I talked about some risks in Part I of this series so I will only discuss them briefly here. Risk of loss, damage, obsolescence (like rotation), banning, etc. all fall into the first category. If you can identify one single thing that will really ruin your day, you need to diversify now. And I’m not just talking about the guy who has 400 copies of [card]Snapcaster Mage[/card] and nothing else.

If your entire inventory is for the same format, you risk that format falling out of favor or losing tournament support. If your entire inventory is in one room, you risk losing everything to a fire or the sprinkler system or a break-in (are you insured?).  Heck, if all your money is tied up in Magic cards, you risk Magic losing popularity. It can happen. It’s not likely, but you should make sure that you can survive it if it does happen.

This might seem overboard if you are a casual speculator with a few long boxes of cards, but you wouldn’t feel that way if your livelihood depended on it. It’s worth the time to ponder all of these “what if” scenarios. Inevitably, you will find that you can reduce your risk exposure with relatively minimal effort.

Diversifying can do even more than that, however. Normal fluctuations in demand can be tougher on a business than you might think, and diversification can help smooth that out. I’m not talking about anything catastrophic, just a Standard season that isn’t particularly engaging (like this one) or a Modern season that sees low turnout because it got moved to the summer and everyone is at the beach.

Depending on the structure of your business, it doesn’t take much more than a few slow months to find yourself in an awkward position. A narrow inventory will make these scenarios even more likely. If you can stock at least something that moves well at each point throughout the year, it is probably a good move and worth going out of your way to do, even for casual speculators. It will keep the cash flowing which is super important for everyone, not just those paying for a brick and mortar store.

Wrapping Up

I’ve had a great time writing this series and I feel like I addressed the topic (specific to Magic) in more detail than previously available. That’s not to say I covered it all. I am going to explore the possibility of tackling other general business concepts and applying them to Magic in the future. All suggestions are welcome.

If you have any questions or thoughts, as always, find me on Twitter (@acmtg), on Reddit (acmtg) or write me here in the comments.
Thanks for reading.

Counterfeits On TCGplayer: My Experience

I have some good news and some bad news.

The bad news first: some of the Chinese counterfeit cards have found their way onto In fact, I received three counterfeit Return to Ravnica [card]Hallowed Fountain[/card]s in a purchase from a vendor last week.

The good news is that they were very easy to identify and that’s response was awesome.

I’m writing this article for two main reasons:

  1. To give detailed information about the counterfeits for anyone who comes across suspect cards

  2. To talk about TCGplayer’s response so you know what to expect if it happens to you and so you can adjust your buying behavior if you feel it is necessary

I’ll walk through the whole experience from beginning to end for those interested. I am a Brainstorm Brewery writer after all, so nobody is getting out of here without sifting through at least 1,500 words (much more in this case). If you are only interested in how to identify the counterfeits, that’s fineskip straight to the “Identification” section toward the bottom.


First, let me say that although I’ve played Magic for quite a long time, I had zero first-hand experience with counterfeits (that I know of) prior to last week. Many community members have dealt with previous counterfeiting attempts but I was coming in with a clean slate.

I was, however, well aware that the Chinese counterfeits existed and I had read a lot about them. To some extent, I knew what to look for. In the “Conclusions” section at the end of this article, I discuss whether the counterfeits would raise a red flag for someone who was totally in the dark. Spoiler alert: not necessarily.


I purchased the [card]Hallowed Fountain[/card]s in a large cube update/spec buy that used several TCGplayer vendors. The Fountains were the only three cards I purchased from this particular vendor, and I’m not going to reveal that name because TCGPlayer is trying to determine intent. The Hallowed Fountains were the cheapest listed by a fair amount. They were $5.39 and the next cheapest was around $7.00. Take that for what it iscircumstantial evidence.

I checked the vendor’s store and he had only a few other things for sale, including a couple of [card]Overgrown Tomb[/card]s (also priced below market). I’ve had good luck with vendors like this beforenew sellers offering good deals until they build up their rating. I added the Fountains and the Tombs to my cart but the Tombs were gone by the time I checked out. I have to think the [card]Overgrown Tomb[/card]s were probably counterfeit as well. TCGplayer is looking into this, though I don’t expect that I will ever know the outcome.

The vendor shipped same day and with tracking. I ordered these Friday after lunch and had them in my hands Monday evening, which I thought was awesome (at the time). They were shipped in a padded mailer and each Hallowed Fountain was in its own semi-rigid plastic holder. They looked perfectly mint in the sleeve so I dropped them on my desk to wait for all the other cards I ordered without examining them further.

Nothing about the transaction itself raised a red flag. Actually, other than the fact that the cards would turn out to be counterfeit (granted, kind of a big deal), it was the best transaction of the several orders I placed that day.

By Wednesday, I had received enough of my other orders that I sat down to update my cube and file the specs away. Literally the moment I pulled the first Fountain out of the plastic, I knew it was not real. I’m talking, I still only had one hand on it from pulling it out of the sleeve and I already knew. If you handle Magic cards regularly, it’s that apparent.

The finish was the giveaway for me. It felt almost like a playing card. Everything I had read about the counterfeits said something like this: “They may look like good fakes in pictures, but you would never confuse them if they were in your hand.” That is exactly right. I’ve handled plenty of Magic cards in my lifeold ones, new ones, specialty products, you name itand these felt much different than any of them.

All three Fountains were the same. I tried the light test on all three (as well as a variety of real cards for comparison) and they failed. I looked at some other tests but I don’t own a jeweler’s loupe, wasn’t willing to rip the cards to check for the blue line or try the bend test until I talked to TCGplayer, and didn’t even bother to try the water test because the cards were so glossy there was no way water wouldn’t bead up on them.

I immediately emailed and then, without thinking too much, I tweeted about it.twitter1.jpg

Probably for the same reason I still get blown out by combat tricks in Limited, I totally underestimated how big a deal this was to so many people. It was slightly irresponsible to throw something like that out without solid backup. Within a few minutes, a number of people requested pictures but I decided a video was better. The texture was a big indicator and there was no way to show that in a picture

I posted this video on YouTube.

This was my attempt to explain my thinking 15 minutes after I discovered the cards. There was some good information that was left out because I rushed it. If I had done a little research and figured out what else to look for before I tweeted, I could have included more in the video. In my defense, I was on my third IPA.


The community was awesome. You guys know this already, but it never fails.

I got a lot of advice from people who had dealt with counterfeits before, including this specific round. @TheCardNexus was especially helpful and told me about other potential differences I should check. He was spot on

Magic players are looking out for one another on this. If you ever have a question about card authenticity, Twitter is a great place to go. There is an incredible knowledge base out there and a lot of well connected people (Jason Alt, for example) who can get those questions in front of the people who can answer them best. Take advantage of it.

What wasn’t helpful was a number of people on YouTube definitively declaring the cards authentic Event Deck cards, this despite never having seen them in person and apparently ignoring part of the video (the light test). All this does is increase confusion for the other people reading and watching. The cards weren’t from an Event Deck. How did I know that? Because I’ve purchased Event Decks in the past, held the cards, and they didn’t feel anything like these. And guess what, Event Deck cards do pass the light test.

It was Wednesday evening when this happened and TCGplayer emailed back Thursday morning. In the very first email, they fully refunded my purchase and asked me (not told me) if I would send the cards to them for further evaluation if they paid shipping. They asked for all three cards and offered to call if I had questions.

I am in a customer-facing business so I appreciated this for several reasons. First, TCGplayer didn’t ask any questions, require any justification, or make me jump through any hoops before giving me a refund. If you sell anything to anybody, you are going to have to deal with some ridiculous claims. At this point, they had no idea if I knew what I was talking about or if I was just another idiot causing a stir. It is pretty tempting to say, “There is a 95% chance this guy is dead-ass wrong, let’s act accordingly,” but they didn’t.

They paid for the cards to be shipped overnight and even had the cards delivered to a home address since they would be arriving Saturday morning. On the following Monday (which was this past Monday), they let me know they had confirmed the [card]Hallowed Fountain[/card]s were not authentic and that they were shutting down the seller while they investigated intent. As I mentioned above, they are also reviewing other recent transactions from the seller.

The people I dealt with from TCGplayer were courteous and appreciative of my cooperation. Their response was quick and thorough, in my opinion. Thumbs up to all the way.


First, watch the video if you haven’t. Below are the things I saw when handling the counterfeits, including a couple that aren’t in the video.

As I said, I did not have a jeweler’s loupe and I did not perform any destructive tests because I anticipated sending the cards to TCGplayer. So this is certainly not a comprehensive list.

1. Gloss – This is the first thing I show in the video. Call it the “squeak test” or whatever, but the counterfeits are substantially glossier.

I did look at Event Deck, Duel Deck, and Commander cards that I had. Yes, some of them do feel slightly glossier but not close to the counterfeits. And the cards from supplemental products do, in fact, squeak if you rub them, although maybe not quite as much as cards from normal expansions.

2. Light Test – This is the second thing I did in the video. The iPhone flashlight works great here, and the difference is drastic. The light shines right through regular cards, including Event Deck cards and other supplemental products, but not the counterfeits. After trying a variety of cards (new, old, etc.), I found no exceptions with real cards. I could see the light clearly through all of them.

If I had only had one test to identify a counterfeit, this is what I would use. It is certainly the most practical and, as far as I know, it is very reliable as well.

3. Corners – The corners of the counterfeits were miscut, they were round almost like Alpha corners.fountain 1.jpg

Legit copy of RTR Hallowed Fountain on the left, counterfeit on the right. Note the corners.

fountain 2.jpg

The corners again, comparing to a legit white bordered card, to the extent a 5th Edition Giant Strength can be considered legitimate.

4. Borders – In the first picture above, you may notice that the borders are thicker on the counterfeit. It’s not that the card itself is bigger, just that the middle of the card is a little smaller so the borders take up more of the face.

5. Size – The width of the counterfeits is very slightly smaller than authentic cards. Like, less than 1mm smaller. I believe the height is the same.fountain 4.jpg

The width of the counterfeit (front card) is slightly smaller than the authentic card behind it.

6. Coloring – This is pretty hard to see in pictures (maybe if I had a better camera) but it was apparent when I had the cards in hand. The coloring of the counterfeits, especially the browns, was slightly washed out compared to the legit cards.

fountain 3.jpg

Legit copy on the left, counterfeit on the right. Note the coloring. The backs of the counterfeits were similarly washed out although I failed to get a good picture.

On the coloring, I really don’t think I would have noticed this if I wasn’t looking or if there was no other reason to question the authenticity.

Also, after looking back at other cards in my inventory, I definitely noticed plenty of color differences in authentic cards. I found a couple of [card]Birthing Pod[/card]s, for example, that have much more noticeable coloring differences than these two [card]Hallowed Fountain[/card]s, but both Pods passed all other tests. So I would say that coloring alone is not a good indication of authenticity and it should be used in conjunction with the other things I’ve mentioned.

7. Clarity – Again, I didn’t have a jeweler’s loupe but you could see that the print was slightly fuzzy in places on the counterfeits just by looking closely. The artists name in the picture above was one of those places, but there were others. Not sure if it comes across in the picture, but the authentic card was sharper.


The end result of all this for me is that I don’t feel the need to change my buying practices on very much. I’ll even continue to buy from new sellers if I see a good deal, although I never do that with expensive cards. Best case, I get some cheap cards while the seller builds feedback. Worst case, the cards are counterfeits but they get identified and taken out of the system at no cost to me instead of ending up in the hands of somebody who doesn’t know the difference. I feel adequately protected here.

Now, there will be people who don’t want to deal with this at all. While there was no financial cost to me, the whole thing did take up a bit of my time (although I got an article out of it) and I still don’t have any [card]Hallowed Fountain[/card]s. I didn’t look at it as a hassle, but some might. Buying only from reputable sellers on remains the first and best line of defense if you want to avoid this totally.

I am slightly more worried about buying from non-TCGplayer sources now. I know ebay/Paypal have good buyer protection, but those companies are not going to know anything about counterfeit Magic cards. Would it have taken longer to come to a resolution if this was eBay? I’m not sure. If you are dealing outside of those markets (or similar markets), buyer beware. You may have no protection whatsoever.

Another thing I am more worried about now is counterfeits finding their way to new players. The [card]Hallowed Fountain[/card]s looked very good in the sleeves to me and I didn’t notice anything different about them until I took them out. I can definitely imagine a newer player acquiring these cards unknowingly and jamming them right into sleeves and into a deck. If they didn’t notice the gloss initially, I doubt they will notice the rounded corners once in a sleeve. It’s going to be a feel-bad moment for everyone when these cards get discovered by a more experienced player. Whoever pawned them off on the new guy is obviously long gone at that point and there is probably no recourse.

Bottom line, I think these counterfeits are good enough to trick some newer players. That is a concern.

TCGplayer did respond well, but they still have a big challenge in front of them. Ultimately, taking counterfeits out of the system one at a time after they have been sold is going to be a long and expensive undertaking. Finding a way to prevent this from happening in the first place is the goal, but that won’t be easy. They mentioned that they are working on some videos. That is a good first step.

Lastly, I would stress to everyone that you are entitled to question the authenticity of your cards if you have doubts. Assuming you are legitimately concerned (not just being difficult) and assuming that you are asking in a civil way, don’t stop until you are satisfied. “I’m concerned about the counterfeits in the system, do you mind if I try the light test on these before we finish the trade?” is perfectly reasonable. Don’t forget that there is a list of the cards that were in this counterfeit print run.

Certainly, don’t be embarrassed if you question something and the cards turn out fine. You don’t have to make an accusation in order to get confirmation that the cards are authentic. If at any point the seller or other trader refuses your request or tries to embarrass you for asking the question, I would just walk away. No need to take that kind of risk.

That’s all I have. Thanks for reading and as always, hit me with any questions you have here or on Twitter (@acmtg).

Inventory Management Part IV: Sunk Cost

This is part four of my Inventory Management series. Parts one through three are here, here, and here. Read them first if you haven’t already. I really appreciate the feedback I have been getting and I’m happy to answer questions.

Today we’re talking about sunk cost. Sunk cost is not just an inventory management topic, but a very general economic concept. The thing is, your inventory is a sunk cost. That makes it incredibly important to understand the concept if you want to effectively manage your inventory.

Sunk costs present a bit of a trap. If you aren’t familiar with this line of thinking, you may be lead into some buy and sell decisions that feel fine, but really aren’t very good.

That Sinking Feeling…

Let’s start with a definition.

A sunk cost is a cost you have already incurred and that you can’t undo, thus making it irrelevant to your decision making going forward.

The first half of that sentence is simple, the second half gives people fits.

There are two distinct decision points in each of your Magic transactions (or any transaction, because this applies very generally): the buy decision and the sell decision. Your profit is a function of both of these decisions, but the decisions themselves are made independently of each other.

Think about that for a minute. These two decisions should be totally unrelated.

When you make your buy decision you choose when to buy, how much to buy, and how much you are willing to pay. After you make this decision, it’s done and can’t be revisited. Any money you spent is now a sunk cost. That ship has sailed. You really won’t know if it was a good buy decision or a bad one until later on, but either way, there is nothing you can do about it now.

Once the buy decision is in the past, all you can focus on is the sell decision. It’s super important to realize that half the battle is over and you have to live with the results of your buy.

When all that’s left is the sell decision, all that matters is revenue. You are going to make the sell decision that gets the most money in the door, period. It doesn’t matter how much you paid. You are strictly in sales mode. If your buy decision was solid, you are in line to make some money. If your buy decision was awful, you are just trying to stop the bleeding. Either way, all you should care about at this point is getting as much money as you can for your cards.

I can’t stress this enough – you should not be looking at your buy price when you sell cards. The trap that many, many people fall into with sunk costs is letting their buy decision influence their sell decision. The first thing most people do (including me) when they are considering selling a card is look at the price they paid. It’s really a bad habit. Focus on selling, then go back and look at your buy price and see how you did.

Here are two examples to illustrate how failure to recognize a sunk cost can lead to bad decision making.

Example 1 – Profit Targets

Trader A and Trader B both buy a playset of [card]Scavenging Ooze[/card] for $25, each thinking the card has a lot of potential for the coming Modern season. Indeed, the card increases in value substantially over the next few months.

Trader A looks around and sees that the card has leveled off at $40 for a set. Modern season is coming to a close and he thinks it is unlikely the card sees any further increases so he decides to sell at $40. He looks back at his inventory sheet and sees that he paid $25 for the set which gives him $15 profit. Nice work.

Trader B also notes that the market for his Oozes has leveled off at $40, but he (incorrectly) considers his buy price when determining his sell price. You see, Trader B has a rule of thumb that he doesn’t sell until he doubles up. He looks at the $40 price, says, “That’s not enough profit,” and holds out for $50

Trader A’s profit is $15. Trader B’s profit is $0.

Assuming they correctly identified the new stable price as $40, this was a very bad decision for Trader B. Trader A now gets to take his $40 and pick up the Theros card he thinks will be good in the new Standard (or whatever). Trader B, meanwhile, has zero cash and four Oozes that are probably not going up anymore this year and might just go down after Modern season ends.

Trader A concluded that $40 was the best he was going to do and pulled the trigger. He didn’t consider what he paid, he knew $40 was as good as it gets and went with it.

Trader B, on the other hand, made the critical error of factoring his buy price into his sell decision. The market cares not one bit about what you paid for your cards. Trader B should have realized that the buy decision on his Oozes was far in the past, meaning that cost was sunk. If he had, he would have seen that $40 was the best he was going to do and sold his cards even though he didn’t hit his target.

Now, if they decided that the Oozes were definitely going to $50 per set, the correct decision for both is to hold. Either way, it has nothing to do with what they paid, only with what they think they can get. That is the takeaway here. It is counterintuitive in business to forget about what you paid. It seems irresponsible. And it’s not that it doesn’t matter, it’s that it doesn’t matter for the sell decision. You should certainly go back and review your buy decisions before making new ones. If you are chronically overpaying for cards, yeah, that’s a problem. But it’s entirely on the buy side.

Now let’s reverse the scenario. Everything still applies:

Example 2 – Cutting Losses

Exactly as above, Trader A and Trader B both buy a playset of [card]Scavenging Ooze[/card] for $25, thinking the card has a lot of potential for the coming Modern season. Unfortunately, this time it shows up as a reprint in the Conspiracy product and the price tanks.

Trader A looks around and sees that a set of Oozes is going for $15 and dropping steadily. Modern season is coming to a close and he thinks that even after Ooze bottoms, the reprint will hold prices down into next year. He decides to sell at $15 because he thinks it’s the best he can do. He looks back at his inventory sheet and sees that he paid $25 for the set which gives him a $10 loss. That is unfortunate.

Trader B also notes that the market for his Oozes is $15, but he (incorrectly) considers his buy price when determining his sell price. Trader B absolutely refuses to sell anything for a loss. “I’ll just wait it out,” he says.

It might be weird to think of “minimizing losses” as being synonymous with “maximizing profits,” but that’s the case here. Trader A realized that his Oozes were a sunk cost. He couldn’t undo the purchase, so he followed solid sell decision logic: get as much money as possible for his Oozes. He’s down to $15, but now he can buy Theros cards like he planned and start building that back up.

Trader B, on the other hand, has no cash and a set of Oozes that is still dropping in price. He’s going to miss the opportunities that come with rotation and the new Standard season and really has no idea when or if his Oozes will rebound, all because he was looking at his buy price when deciding whether to sell.

Keep Your Eyes On The Road

It might feel like you are wearing blinders, but you don’t want to be looking too much at the “cost” column of your inventory sheet when you are selling cards. In fact, hide it if you want—you don’t need it. Those decisions are made. Every time you look at cards already in your inventory, focus only on your sell price and timeline. How much can you get for these cards and how soon?

The vast majority of us in the financing community started as players. Have you ever pulled a box of old cards out of your collection and started flipping through them, looking for anything valuable? The only thing going through your mind is, “How much money can I get for these?” You bought those cards so long ago that you don’t remember and don’t care what you paid. You are focused solely on maximizing sales. What can I buylist? What singles should I sell now? What singles will be worth more if I hold them for a bit? Basically, how much money is in this box? This is what it feels like to truly recognize sunk cost and focus only on the sell decision.

It is very hard to train yourself to think the same way with cards you just bought. Your buy decision is so fresh in your mind. The truth is that if you buy a card the day before it gets banned, your profit-maximizing decision is to turn around and sell it the next day even if that means losing money. The most money you will ever get for that card is right now, before it tanks. It sucks that you just bought it yesterday for more, but that cost is sunk and you can’t change it.

I promise that you will make considerably better sell decisions and thus make more money if you look at your inventory as sunk cost.

In Closing

To be clear, this does not minimize the importance of tracking. Tracking still tells you how you are doing and is an absolute must. You just want to be sure to wait until after you sell the cards to look back at your buy price. Did you make money or lose money? Why? Was the decision to buy a good one or a bad one? This is where you look at cost. Then ask yourself the same thing for the sell decision. Analyze those decisions separately, not as one big transaction.

Well, I think I’m almost finished with this series. Next week I’m planning on tying up some loose ends, but I feel that the heavy lifting has been done. If anyone has any questions about inventory management, hit me up on Twitter (@acmtg), on Reddit, or in the comments here. I’d be happy to answer reader questions in the final part of the series.

Thanks for reading.


Read the other excellent installments in this ongoing series. 

Part 1: The Basics
Part 2: Tracking
Part 3: Turnover

Inventory Management Part III: Turnover

This is part three of my Inventory Management series.

Two weeks ago, I led with an introduction talking about the purpose of inventory as well as some common mistakes. In short, inventory is there to support your sales which is how you make money.

Last week, I talked about tracking your inventory and calculating your return on assets. This is how you can tell if your Magic finance endeavor is even worth it.

Today we’re talking inventory turnover. I said that you carry inventory to support sales, and this metric will tell you how well you are doing it. It’s the heart of inventory management. Carefully monitoring your inventory turnover is critical and it will save you money and guide your purchasing decisions.

Tell Us How It Works

Inventory turnover is a simple formula:

Inventory Turnover = Cost of Goods Sold / Average Inventory

We haven’t used the term “cost of goods sold” exactly before, but it is what it sounds like: your cost on the cards you sold. It’s not your total sales. It’s the cost at which you were carrying the cards in inventory. In part two, we briefly discussed how to calculate average inventory, which is the denominator here.

Okay, a very simple example to make sure we are on the same page. Let’s say I carry about $1,000 worth of inventory and that is constant throughout the year. I sold $2,000 worth of cards this year (that’s my cost, the actual sales would be higher because I am selling for more than I paid), so my total inventory turnover is ($2,000 / $1,000) or 2.0.

One way to say it would be that inventory turnover is the number of times you sell through your inventory in a given time period (often a year but sometimes you will see monthly numbers). Of course, it doesn’t literally mean I sold through my inventory twice because it’s an average of all my items. In every case, there will be some items that sell very well and turn more than the average and some items that sell slowly or don’t sell at all.

When it comes to inventory turnover, generally higher is better. Why? Because a faster turning inventory reduces the amount of money you have to tie up to maintain your sales. That means lower costs. Lower costs means higher profit. You may not want to push it to extreme levels, though, because very high inventory turnover usually means frequent stockouts and lost sales. This mostly applies to stores with repeat customers, but even speculators should consider lost sales. Dumping your entire inventory after a pro tour is great (and helps inventory turnover), but it leaves you with a period of zero sales until you get stocked up again.

What’s Good?

It’s going to vary depending on your setup. If you own a brick-and-mortar store, you will probably be forced into carrying a larger selection of cards, which makes turning your inventory harder. Your customers will depend on you when they are looking for singles, and this means you will carry things that don’t turn well to support them. It’s worth it if it means they don’t go to another store to find their cards.

If you are an eBay or TCGplayer seller, or if you just speculate on the side, the sky is the limit. You may be buying a very narrow range of cards and flipping them very quickly and that will send your turnover through the roof.

Low single digits (zero to two) turns per year is pretty bad regardless. A little higher, three to four turns, is fine for a lot of businesses. I’d be very happy with five or more, and if you can get higher than that, you are killing it. Some companies can do eight or even double-digit turns, but at that point you are the one writing this article, not me.

Low Turnover – What Does It Tell You?

You need more protein in your diet. Just kidding. If your inventory turnover is very low, it means one of the following things:

  1. You have more inventory than you need to support your sales.

  2. You have the wrong mix of inventory and your non-movers are dragging you down.

To illustrate…

Example One: You specialize in buying and selling Standard cards and you are the go-to person in your area. Business is good, sales are as strong as ever and your local knowledge allows you to keep the right mix of cards in your binder. Despite this, inventory turns are still very low and you aren’t sure why.

Solution: This is scenario one above, you are just carrying too much stock. If your FNM usually draws 20 people, you don’t need ten pages of [card]Hero’s Downfall[/card] in your binder. The low inventory turnover is telling you that you can cut inventory without sacrificing sales. Don’t get caught building a huge inventory for bragging rights. Take that money and do something productive with it instead.

Next one…

Example Two: You, like many of us, have been making a killing on Modern. Your Modern staples are flying out of your binder and you can’t seem to get new stock in fast enough. Much to your surprise, your recent success is not reflected in your inventory turnover, which still stinks. What’s the deal?

Solution: Clearly your Modern stock is turning like crazy, so this is almost certainly scenario two. I would bet your Standard / Casual / EDH binder is not getting nearly as much action and you are effectively averaging a bunch of zeros into your calculation. Keep doing what you are doing with Modern, but either figure out how to start moving cards from your other binders or get rid of them and plow that money back into Modern cards.

In both cases, fixing the slow-turning inventory will save you money. It will either allow you to deploy money elsewhere while keeping your sales intact (example one) or help you meet demand and avoid stockouts by tilting your product mix toward things that sell better (example two). Both will pop your return on assets.

Get Granular – As the second example illustrates, sometimes you have to take a granular look instead of using total inventory turns. Try calculating inventory turnover for different segments of your inventory – Modern, EDH, Standard, etc.

In fact, if you are running a store and always have certain cards in stock, you’ll want to look at the turnover of those individual cards. Set your stock to a level that keeps your turnover healthy but not crazy high.

Turn, Baby, Turn

First and foremost, turnover should be used to guide your inventory decisions: how much and what to hold. But having a fast moving inventory carries with it some other benefits that may be less apparent.

  1. It reduces risk. Click back to my intro and read about the hidden costs of inventory, specifically #3: risk. A fast moving inventory really helps mitigate the risk of banning, reprint, obsolescence, etc. A big, stagnant inventory of Magic cards is a sitting duck for these things. If you decide to, say, move away from Legacy cards because you are afraid SCG is switching its open series to Modern, you don’t want to have to wait nine months to sell through your enormous stock.

  2. It helps with liquidity, which gives you flexibility. If your inventory is turning quickly, more of your assets are going to be passing through your hands as cash. Every time this happens, you get to make decisions on what to do with it. Most often you will just buy more inventory to sell, but you get to be more reactive on product mix. You might also decide you need cash for something else, like a booth at a local tournament. A pile of long-term specs (the slowest turning inventory possible) won’t help you there.

Balancing Act

There are two things I want to address here that I feel are important to Magic. They are both going to require judgement.

The first are rare, high-priced, or specialty items. These types of things are naturally slow turning and they aren’t going to fly out of your binder like Standard cards. This doesn’t mean that the principles of inventory turnover don’t apply, you just have to be more flexible. If you have some Beta duals or something equally spicy, taking the time to find the right buyer is a no-brainer. You can really lose a lot of money by rushing a sale like that.

That leads me to the second point, which is holding cards you think are going to go up in value. I could write a whole article on this (and I might), but my advice is this: sell your cards. If you can make a reasonable profit, just move the inventory and find something else to buy. When you find yourself justifying a very slow-turning inventory because the specs “haven’t matured yet,” I think you are probably taking the wrong approach.

People tend to underrate how well velocity translates to money. This is ultimately what made the  binder-grinding thing so successful. Take this example:

  • Trader A buys $100 worth of Snapcaster Mages at $15 each. He knows they are a stone-cold mortal lock to sell for $30 in one year and he will double up. He does. He now has $200. His inventory turnover is one.
  • Trader B decides to spend his $100 on a bunch of different stuff that will move well at tournaments. He knows that on the floor, he can get a little more than retail and probably make 10% profit at any given tournament. He goes to a different tournament each month of the year (12), sells his whole inventory each time, and then reinvests all profits into more inventory for the next tournament. At the end of the year he has $314 (!). His inventory turnover is 12.

This is the same epiphany you have the first time you learn about compounding interest in personal finance. The point is that you can make a ton of money selling at low margins if you are turning your stock quickly enough.

As I said, some judgement is required here – you might want to wait until the right PTQ season to sell, and that is totally reasonable. Otherwise, sell your cards. I cringe when people turn down a 50% profit on a spec because they are waiting for 100%. If you are heavy into “long term” stuff (more than a year until sale), I can almost guarantee you would be making more money with a different approach.

Wrapping Up

That’s a ton of info. I think I have one more article before this series is over, as I have to cover sunk costs and a few other miscellaneous things. Please feel free to ask questions – you can find me on Twitter, @acmtg, you can leave a comment here, or you can ask a question on the /mtgfinance Reddit, because I post there as well.

Thanks for reading.

Inventory Management Part II: Tracking

Last week, I started my Inventory Management series by discussing some basic concepts and common mistakes. Today we’re going to get down into the weeds—we’ll start with tracking and then briefly touch on some metrics you can use to evaluate your performance. I’ll talk more about metrics in my next article, but accurately tracking your inventory is a prerequisite to that.

I’ll describe the way I do this, but you should understand that it is not the only way. There is plenty of room for variation in the way you track and the metrics you use, so put your own spin on it. As long as you are drawing the right conclusions, it works.

This certainly won’t be the most exciting Magic finance article you ever read, but hopefully it will help you improve your margins. Here we go.

Your Assets

The first thing to understand is that your Magic cards are assets. In the accounting sense, assets are tangible things that you own that have value. Cash is also an asset, just like sealed product and singles. Mostly, managing your inventory means managing your cash and cards.

Because they hold value, assets are different from expenses. Expenses are things you spend money on and then are used up or don’t hold value. Things like rent and shipping fees are definitely expenses, and you should also consider sleeves, boxes, etc. to be expenses. Obviously you want to track your expenses too, but we aren’t going to cover it here because this is about inventory. Also, your amazing Limited skills are not an asset in the accounting sense of the word. Sorry!

The first thing you want to do is make a balance sheet, which is super simple. It’s a high-level list of all your assets.

If you are just starting out, your balance sheet might just be this:

$1,000 Cash

More likely, you have mix of cash and cards, maybe like this:

$500 Cash
$500 Singles

$1,000 Total Assets

It is very important to track the cash you have for financing. You really don’t want your Magic cash and your personal bank account to be one big pot. It’s hard to evaluate yourself that way and it can lead to some feel-bad moments like trying to pay your rent in [card]Birthing Pod[/card]s if you mess it up.

So you have some cash and some cards. When you buy or sell cards, you are just converting cash to cards on your balance sheet or vice versa. Let’s say I’m starting with the $500/$500 split above and decide to pick up a Return to Ravnica booster box for $100.

– $100 cash
+ $100 sealed product

Now my balance sheet looks like this:

$400 Cash
$500 Singles
$100 Sealed Product

$1,000 Total Assets

My total hasn’t changed, I just changed the mix.

You don’t want to mix your business cash with personal cash, but you will have cash flowing in and out of your Magic business by necessity. If you need $100 to buy the girlfriend a birthday gift, just record it. Now you are minus $100 cash and have $900 in assets for your Magic financing endeavor instead of $1,000. Similarly, if you want to ramp up your speculation efforts and put another $500 from savings into cards, record the inflow of cash as a transaction. Transparency is key! You need to know where every dollar comes from and where it goes.

Tracking Inventory

You buy some cards. Inventory goes up, cash goes down. When you do this, you need to record some information about what you bought. At a minimum, here is what you need:

  1. What you bought: the card, sealed product, etc. You might want to record set, condition, or other relevant bits of information.

  2. Quantity, in whatever units are applicable (cards, boxes, packs, etc.).

  3. The price you paid for each unit. Make sure the units match. From this you can calculate the extended price, which is just the quantity times the unit price.

  4. The date of purchase.

It might look like this:Inventory1.jpg

When you total up everything you have here, it should match your balance sheet. In this example, I’m showing $207.03 of singles, which would show up on my balance sheet next to any cash I have left.

Cost Averaging: If you are buying the same card at different prices (which will definitely happen), I recommend using an average cost. So for example, if I buy four [card]Scavenging Ooze[/card]s at $6 and four at $7, I’m recording those as eight $6.50 cards. There are other ways to do this too, but they’re much more hassle than they’re worth, in my opinion. Doing the math creates a little extra work on the front end, but simplifies the process greatly when you sell. I use the average cost method even if I’m buying many copies over a long period of time. Just keep recalculating the average whenever you add to your position.

All-In Cost: You should also roll any shipping into the card cost. If I buy a playset of Oozes for $7 each and pay $1 in shipping, I’m dividing that dollar over the four cards and putting them into inventory at $7.25 each. If there are any other random costs associated with acquiring your inventory, roll them into the cost as well. An example that comes to mind is spending $20 in gas to go pick up a case of booster boxes you bought on Craigslist. Consider it part of the purchase price.

Mark-to-market: You are going to carry your inventory at the price you paid for it. This means that when cards increase dramatically in value, you will have unrealized gains. For example, [card]Misty Rainforest[/card]s you bought at $30 each will continue to be tracked at $30 in your inventory no matter how much they are actually going for. You may feel temptation to mark these up to the market price (called mark-to-market), which will increase the value of your assets on your balance sheet by realizing the gains on paper.

I recommend you resist this urge. First, it’s a real pain to constantly be adjusting the cost of the cards in your inventory. Second, you are going to be inclined to mark things up when it is in your favor and inclined to avoid it when it’s not. Third, carrying cards at their original cost forces you to sell to realize the gains, and I tend to think that is a good thing. As always, use your best judgement.

One last thing—your assets may fluctuate over time. For the metrics we are going to use later, it is necessary to record your inventory and cash totals periodically. I do this at the beginning of every month. Start another sheet and punch in the total amount you have in cards and in cash at the start of each month, just those two numbers. This will allow us to figure out the average inventory and average total assets.


At this point you should have two main things. The first is a balance sheet that shows, at a high-level, how much money you have in cash and cards. You should also have a detailed list of all the cards or product you own, which is your inventory list. Good start.

Now you sell some of your cards, which is the goal. Even better, you sold them for more than you paid.

I’m going to use the [card]Scavenging Ooze[/card]s listed above. I’m carrying eight copies in my inventory at $6.95 each. Let’s say they shoot up and I sell them for $9 each after fees (that’s important, you can’t forget to take fees out).

Here’s what happens to my balance sheet:

– $55.60 Inventory (8 * $6.95)
+ $72.00 Cash (8 * $9.00)

I take the Oozes out of inventory and put the cash I made in. So now my balance sheet went from this when I started:

$207.03 Singles

$207.03 Total Assets

To this:

$151.43 Singles
$72 Cash

$223.43 Total Assets

My total assets have increased by $16.40, which is the profit I made on the sale. You want to track your total sales and profit separately. It all goes in the “cash” bucket on your balance sheet, but later on you will need to tell the difference between cash that you contributed and cash you made.

You will notice that even though I only made $16.40 in profit, I now have $72 in cash because I get my original investment back. We’ll talk more about this next time, but raising cash is usually a good thing. Not only do I lock in that $16.40 in profit, but I open up the full $72 (original Ooze investment plus profit) for other buys.

Return On Assets

If you are still with me, you are now effectively tracking your inventory. It really wasn’t that hard. We have all the information we need now to measure our effectiveness, so let’s talk about that.

The first thing you want to know is your return on assets (ROA). This tells you whether your entire Magic financing adventure is even worth it. Here is our version of ROA:

ROA = Profit / Average Total Assets

You can do this over any time period, but a year is a good place to start.

An example to illustrate the importance of ROA. Trader A and Trader B both made $5,000 in profit from selling cards last year (not sales, profit). Trader A keeps about $5,000 in inventory and cash on average for his business, while Trader B keeps a whopping $50,000.

Trader A’s ROA for the year is $5,000 / $5,000 or 100%. Trader B’s ROA is $5,000 / $50,000 or 10%.

This means, for starters, that Trader A is crushing Trader B even though they are making the same amount of money. Trader A made the same profit with far less cash and inventory. If he scaled inventory up to what Trader B had and maintained his ROA, he would have made $50,000 profit to Trader B’s $5,000.

The ROA number is also a good one to compare to other investments. Trader B is making $5,000 in profit (income) on the $50,000 he has invested in cards and cash for a 10% return. That is better than he is going to get in a savings account, for sure. It was worse than having that money in the stock market in 2013 but probably slightly better than the average year. Trader A is crushing everything in sight, it would be a huge mistake for him to invest money anywhere else with a 100% ROA.

When you are doing these comparisons, keep in mind how much effort you are putting into your financing activities. If you can just plop your money into an index fund and earn the same return as you would buying and selling cards all year, it’s not worth it. You should be looking for an ROA substantially higher than your other options.

Your ROA is going to stink when you first start. That’s because you have to ramp up inventory first by necessity, with sales to follow. This metric is best used after you get rolling.

A bad ROA indicates you are doing something wrong. It doesn’t really tell you what you are doing wrong—you will have to diagnose that yourself. Next we are going to talk about inventory turnover, one of the things that will help you increase your ROA.

We’ll pick up there next week.

Thanks for reading.

Inventory Management Part I: The Basics

Today I want to talk about inventory management. Others here at Brainstorm Brewery have touched on this subject, but I don’t feel like it’s been explored in enough depth. I think inventory management is a glaring weakness for many financiers, so much so that I am going to dedicate a series of articles to it.

Today is an introduction to the basics—what inventory management is and why it is important. I will cover specific concepts (like inventory turnover) in detail in future articles.

Since inventory management is probably the least glamorous part of Magic finance (or any business, really), it doesn’t always make for an exciting read. I’m going to try using some common mistakes to illustrate the ideas and to make the article less dense. If these sound familiar, you can start improving right away by watching out for them. Future articles will give you more precise tools to manage your inventory.

The What and Why

The goal of Magic finance is to sell cards and make money.

The goal of Magic finance is to sell cards and make money. It’s so important I thought it was worth saying twice.

Inventory enables you to sell cards and make money. That is its only purpose. You can’t sell cards you don’t own (don’t start with the short-selling stuff, either). So the set of cards you have acquired with the intent of selling for profit is your inventory.

We are one section in and I guarantee a lot of people are already doing this wrong. How can that be?

Mistake #1: Collectionventory

Your inventory is not your collection! Your collection is not your inventory! Collecting is about stockpiling cards, finance is about stockpiling money. Big difference.

One of the true rookie mistakes is using your inventory as a measure of success. Owning more inventory does not, by itself, make you a successful financier. It doesn’t necessarily make you unsuccessful either, it’s just the wrong number to look at. The goal at the end of the day is to generate sales and cash. Even if you started with a booster box of Return to Ravnica and traded all the way up to a set of duals, you still have not produced any income and you still have no cash.

Does it feel good to spread 100 copies of [card]Sphinx’s Revelation[/card] out on your desk and post a picture on Twitter? Yes, absolutely. You are only a good financier when you sell that stuff and make a profit, though. If your inventory is increasing dramatically while your sales stay low, you are a good collector, not a good financier. The guy who pays his rent every month with his Magic profits is a good financier. It doesn’t really matter how many duals he has in his binder at any given time.

In summary of this section:

  • You need inventory but it’s not the goal and more doesn’t mean better.

  • Carrying inventory is different from collecting and you shouldn’t get attached to your stock.

Costs of Doing Business

The second thing you need to know about inventory is that it’s expensive and you wouldn’t carry it at all if you didn’t need to. Unfortunately, we just finished covering the first thing, which is that you need to carry inventory. In that regard, inventory management is very much a balancing act.

Here are the ways that inventory is costly:

  1. Most importantly with cards, inventory ties up your money. This is money you could be earning a return on, either through Magic finance or a more traditional investment vehicle, or otherwise using for bills, food, etc. You lose flexibility and you may not be prepared to take advantage if a great deal comes along.

Mistake #2: Dead Money

Let me jump in here with an example. Many of us have had a pretty nice run with the recent Modern spikes. Financiers didn’t really need to be particularly knowledgeable or clever to get a piece of the action, since the entire format essentially corrected in price. The one thing you did need was cash. Whatever was in your binder or spec box that didn’t spike—Standard specs, EDH, Legacy, whatever—was pretty costly whether you realize it or not. You may look at your $100 [card]Scavenging Ooze[/card] spec and still think it’s solid (and it is), but if that was a $100 bill instead, you could have easily jumped on a few sets of [card]Snapcaster Mage[/card]s (or anything else), sold out for a nice profit, and now have a $150 Ooze spec instead. If it’s not making you money, it’s losing you money.

Back to the hidden costs of inventory.

  1. Inventory can be costly to maintain. You have to sort cards, count them to make sure you aren’t missing any, track their prices, buy sleeves or boxes to hold the cards, and so on. You may find yourself putting quite a bit of time into your inventory, or worse, you may be paying someone to do these things. This one is typically not a huge concern for the part-time financier. It’s pretty easy to organize your specs while watching a TV show you planned on seeing anyway. But when you start dealing with large amounts of inventory, buying collections, etc., it’s no joke.

Finally, here’s where all the downside is hiding.

  1. Carrying inventory comes with risk. You could lose or damage cards. They could be stolen. Cards could become obsolete if you aren’t able to sell them before they rotate or a better version is printed. They could be banned. You could buy in at the top of a speculative spike. Wizards could horribly over print Modern Masters II after the volatility this winter. In any case, your inventory could lose substantial value. With the exploding popularity of Magic, it’s hard to lose money being a financier. If it’s going to happen, though, then some version of this inventory risk is the overwhelming favorite to get you.

I’ll talk much more about how you should be tracking your inventory in subsequent articles, but I’ll leave you with this crucial, and very tempting, mistake.

Mistake #3: Ignoring Losses

Losses will kill you, as I said above. We are all inclined to shuffle these experiences to the back of our minds, but it is important that you recognize inventory-related losses. You can’t just forget about them or call it bad luck or stick them in the bad spec box. Here is an example with some numbers to illustrate:

If I buy five copies of [card]Snapcaster Mage[/card] at $20 ($100 total investment), then sell them for $30 cash each, I have $150 for a profit of $50 or 50%. Awesome, 50% is great. But if my dog chews just one of those cards up (or more likely, I confuse collecting and finance again and stick it in my cube) and I can only sell four, I have $120. My initial investment is the same $100, but now my profit is only 20%, meaning I’ve lost more than half of my profit because one-fifth of my inventory disappeared.

When you have a lot of cards you are trying to sell, this stuff will happen and you can’t ignore it. Theft, damage, specs gone horribly bad—these are risks associated with holding inventory and they eat into your profits in a big way. Inventory losses are so painful because you are not only missing out on profits, you are losing your original capital. If you are not recognizing those losses, you are probably less successful at Magic finance than you think. The temptation is to look at the four copies you did sell and conclude that you made a handsome 50% on the Snapcaster spec. However you record this stuff in your spreadsheet, your bank account is going to tell the truth.

Today’s Conclusions

  • Inventory is necessary but costly. You want to keep the smallest possible inventory that will support your sales.
  • Minimize the money you have tied up, the time you have to put in, and the risk of losing value.

Your challenge as a financier is to balance having extra inventory sitting around against missing out on sales because you don’t have the stock.

Next time, we’ll start to talk about the tools you need to do that.

Thanks for reading.

Great Expectations

This is a headline that makes me chuckle every single time I read it:

“Apple posted quarterly results that beat estimates Monday … shares dropped more than 5%.”

For those who don’t follow non-Magic finance, the reason this happens (and it happens all the time to all kinds of companies) has to do with expectations. Apple beat the earnings estimates but it was expected to beat the estimates by even more. The stock price reflected the expectation (not the estimate) and it corrected downward when Apple came up short. The end result is a quarter that looked good on paper but resulted in a sharp drop in share price. It’s all about the expectation.

The thing is, Apple didn’t have a bad quarter. Yes, shares dropped 5%, but that was more a function of high expectations than poor performance. By objective measures, Apple was doing fine—a healthy, profitable company.

If you can sort through expectations and focus on actual performance, you will often find there are opportunities mixed in. A 5% discount on Apple shares just because someone else let their expectations get out of control? Works for me.

We can find similar opportunities in Magic finance.


How about a tier-one Modern deck that put more players into day two at Pro Tour Born of the Gods than any other deck? A deck that will certainly remain relevant going forward and is capable of taking down any given Modern tournament if the meta suits it. The deck is Zoo, and it offers as good a buying opportunity as you will find for many of these cards.

Check out [card]Goblin Guide[/card] on MTGO:


The card is down around 30% since the pro tour. Sure, Zoo didn’t do as well as we thought it would, but is that any reason to be down on [card]Goblin Guide[/card]? (Update: Sorry guys, this one rebounded in the day since I posted this. Magic finance moves quick, I guess.)

Guide is the definitive one-drop in red aggro decks, and one thing we know for sure is that red aggro decks will never go away. It was about this price just before the Nacatl unbanning, and that was all upside for [card]Goblin Guide[/card]—it still goes in mono-red like before and now it goes in (some) Zoo decks as well. Expectations of Zoo were too high and now [card]Goblin Guide[/card] is a buy on MTGO. I have bought and sold my playset of this card several times now, grinding out a few tix each time. I just picked them up yet again.


[card]Knight of the Reliquary[/card] did something similar, plummeting almost 40% from its peak. This one is a little tougher since it really wasn’t doing anything prior to the Nacatl unbanning. It’s on the watch list for sure.

Heck, even [card]Tarmogoyf[/card] is down 10% from the pro tour peak on MTGO. This may not seem like a huge deal in a vacuum, but most other Modern prices are going through the roof. [card]Past in Flames[/card], [card]Geist of Saint Traft[/card], [card]Primeval Titan[/card], [card]Snapcaster Mage[/card], the list goes on. If a single Zoo list had landed in the top eight of the pro tour, ‘Goyf might be 100 tix right now. Instead, the buying window remains open for just a little bit longer. I don’t think this card stays at 80 tix for long and when it moves, it’s probably not coming back down unless it gets reprinted again.

The point is really not to call for buys on these particular cards, but to use Zoo at the pro tour as an illustration. When expectations are high and results don’t live up to them, you have to decide whether the pessimism is justified or the market is overshooting.

Zoo didn’t dominate the pro tour, but that was a big ask to begin with. There were plenty of copies of [card]Wild Nacatl[/card] in the top decks though, and this was in a meta where Zoo was basically guaranteed to be one of the most-played decks. I’m pretty sure that the Nacatl unbanning served as a telegraph that said, “If you only do one thing to prepare for this pro tour, make sure you can beat Zoo.” Accordingly, players packed a million copies of [card]Anger of the Gods[/card].

The deck is solid and the meta won’t always be this harsh. It will be harder to justify sideboard slots to hate out a deck that didn’t top eight the pro tour when Twin and Pod are running wild. In my mind, the market is overshooting. Zoo is a perfectly good Modern deck.

I’ve used MTGO examples here because the market adjusts so quickly. Paper prices don’t bounce all over like that, but I think you can still take advantage of this pessimism in trade. Players will be tripping over each other trying to give you out-of-favor stuff like Knights or Guides for the UWR staples that won the pro tour, [card]Amulet of Vigor[/card], or whatever else. Buy low, sell high—I know, I am a prodigy.

Now let’s take a slightly different angle on this idea.

Commander 2013

The expectation here was not performance-based, but supply-based. The word on this set was that it would be “printed to demand.” I believe this was established by Mark Rosewater, who stated on his Tumblr that Wizards would reprint these decks if demand dictated. Of course, this was a one-sentence answer and we were left to fill in the blanks. The conventional wisdom was that these would sell out around the holidays and then we would see a second wave in early 2014.

What we actually saw was the good decks (and not just Mind Seize) selling out quickly and the clunkers warming shelves until, in some cases, they went on clearance. I haven’t seen a restock of these decks. Most stores here have about two copies of the Naya deck still sitting around. Your mileage may vary, but it seems like a set is only as strong as its weakest deck.

I passed by quite a few Esper and Bant decks in my search for [card]True-Name Nemesis[/card] when the set was first released. Based on the information I had, I expected to sell off the Mind Seizes and then circle back to get whatever else I wanted on the restock. Nope.

There are some very good cards in this set, and they were prevented from being reprinted by the shelf-warmers. The end result is that the size of the print run didn’t meet expectation and certainly didn’t meet demand for the top decks. The market is very focused on Modern and the release of Born of the Gods and hasn’t quite realized this yet.

There is nothing tethering [card]True-Name Nemesis[/card] to a $30 price tag any longer, so the sky’s the limit on that guy. Toxic Deluge is very good and a strong buy in my opinion. When people do get around to acquiring these cards, I think they will be unpleasantly surprised to find there are fewer copies available than they thought.

Even the powerful new cards aimed at Commander and Cube players should see upward price movement before too long. [card]Primal Vigor[/card] and [card]Sudden Demise[/card] come to mind. I think [card]Sol Ring[/card] and [card]Baleful Strix[/card] will come roaring back much sooner than expected. Pretty much everything that synergizes with Nekusar already spiked, so I’m assuming $2 is not a realistic long-term price for him.

In Conclusion

There is a lot of money being thrown around the Magic secondary market these days. With the new breed of trigger-happy speculators in the mix, the strategy of being the first one into a spec is getting harder and harder to execute. Rushing into a spec will make you money sometimes but it will also lose you money sometimes. Being right once is better than being first ten times.

Understanding the expectations of the market will, in effect, allow you to speculate on the speculators. They provide the volatility, you capitalize on their mistakes. Buy good cards at good prices when they get it wrong, and sell into the hype when they come around. Strangely, it’s never been easier to make money in Magic finance than it is right now.

Thanks for reading.

Modern Technology

Two weeks ago, in The Unwilling Speculators, I wrote about the Modern format and how its affordability (or lack thereof) is quickly spiraling out of control. The article got some good discussion going—thank you to all the commenters who contributed.

The article wasn’t intended to be another “blame Wizards” piece. I can only fit so much into one article, and in this case, the problem statement was big enough to stand on its own. Today, I want to talk about solutions. I promise these won’t be ridiculous pie-in-the-sky solutions, either. These are ideas that are feasible, easily implemented, and won’t destroy Wizards’s business model. I’m not going to suggest that [card]Tarmogoyf[/card] be the next FNM promo.

Obviously, Wizards can’t snap its fingers and fix all the issues with Modern’s affordability. There is no silver bullet here. Nor do I expect that Wizards is interested in keeping super tight control of the secondary market. At this point, though, Wizards doesn’t seem to have any handle on it at all.

So here are three simple suggestions that would help make Modern an affordable and accessible format. They are small changes for Wizards that would make a world of difference to players. Here we go.

1. Tell Us What Reprints Are Planned

Wizards knows this stuff far ahead of time, so why not just reveal it? The information would create some stability in the secondary market.

Take, for example, [card]Bitterblossom[/card]. When Wizards unbanned this card, they did almost everything exactly wrong from a secondary market perspective. They created a shock and it touched off a nasty storm of speculation, panic buying, and real demand.

Now, we know we have a Modern event deck coming our way at the end of May. That was announced on January 9, nearly a full month before the DCI Banned & Restricted List update. Conventional wisdom is that the deck will be a black-white tokens deck.

If that is true, why didn’t they just say it? Imagine how much less painful this would have been if they announced a reprinting of [card]Bitterblossom[/card] in the event deck along with its unbanning. Players could then make a rational decision about whether to buy the card now (maybe they want it for Pro Tour Born of the Gods) or wait until May and pick it up at retail (if they just need it for Modern PTQ season). Instead, players are forced into the “now or never” mentality because of the risk that they are wrong about the event deck. Releasing information like this can cut down on panic buying significantly. Wizards can erase the fear of missing out just by telling us what they already have in store for us.

Announcing reprints as early as possible is also a good way to reduce speculation. Most speculators are going to stay away from cards that already have a reprint scheduled. Granted, the reprint has to be timely—I would venture to guess that announcing fetch lands in 2015 would actually cause a short-term spike, not a drop in price. That’s not because this approach doesn’t work, it’s because the fetch reprints are already overdue and Wizards would be confirming another year or more without them. In contrast, if Wizards is planning on printing something useful in Conspiracy this June (like [card]Noble Hierach[/card]), revealing that now would curb speculation over the next few months and allow the price to begin deflating immediately.

2. Stop Wasting Time Developing Limited For Reprint Sets

Modern Masters was a great Limited set. Almost everyone who played it had good things to say. The problem is that a great Limited environment was a secondary goal for the set, and the primary goal of getting more Modern cards into circulation was not nearly as successful. Besides, 2013 already had Return to Ravnica, Gatecrash, full RTR block, Magic 2014, and Theros Limited to occupy us. We weren’t hurting for something to draft.

We need reprints if Modern is going to be affordable. Limited playability is nice, but it’s just icing on the cake. If development of a Limited environment is delaying the set (Vintage Masters, ahem), Wizards should just drop it. It’s far more important to get the cards out there.

Want to know where the fetch land reprints are right now? Stuck in Development at Wizards while they figure out which landfall commons and uncommons make the best Limited environment for the 2015 release. I’m sure drafting the exalted/infect deck will feel great for the one month I get to do it next June, but it’s pretty far down my wishlist as a player. Finishing my set of blue fetches is much closer to the top.

Conspiracy will give us more of the same this summer—a quirky new Limited format that no one asked for with some, but not enough, reprints mixed in. Conspiracy will be fun. Modern will be more expensive than ever.

Wizards created a format entirely out of reprintable cards, and now they should reprint them. Create the card file, get it to the printer, get it in stores, sell packs. Done. I don’t care how the set plays in Limited if I can get the cards now. I want fetch lands this summer so I can PTQ, not a deep and nuanced draft experience in 2015.

It’s time to get over the Chronicles thing. It was over 18 years ago. The truth is that we need another Chronicles. Make it happen, Wizards.

3. Define Its Role In The Secondary Market

This is the most important one, in my opinion.

When I got into Modern, it was specifically because it was a non-rotating format that would be substantially less expensive than Legacy. Did Wizards ever promise that outright? No, of course not. It was certainly implied, though. There is no reason to create a new eternal format where every card is reprintable if you don’t care about the secondary market. I couldn’t afford Legacy then and I can’t afford Legacy now. I thought I could afford Modern based on what they said, so I jumped in. I, like many others, was under the impression that Wizards would play an active role in managing the affordability and accessibility of the format. Was I wrong? If I was, I would like to know now so I can stop feeling guilty about my half-baked Modern collection, sell it, and play Limited full-time.

I think it would be a huge step forward if Wizards just came out and told us how they view themselves in the Modern secondary market. They should define “affordable” and “accessible” for us, and say whether or not they really care about those things. They should tell us whether they are going to get more aggressive with reprints or whether this is it.

They shouldn’t be dodgy about it either. I know I can get a Modern deck for $300, but I want to play tier-one decks. I’m far past the point in my life where I’m okay getting crushed by someone just because he spent more on his deck. Is Wizards comfortable with $1,500 tier-one decks? $2,000 decks? $3,000? As players, we need to know, guys.

I also understand that Wizards doesn’t want to piss off collectors and stores with massive inventories. My question is, “Are you going to do it anyway?” If that group is untouchable, fine, it certainly appears that way right now. Just come out and say it.

By telling the player base where they see Modern going financially, Wizards will empower each one of us to make the best decision for our Magic-playing future. None of us are quitting the game, let’s be honest, but I for one would really like to know if Modern is what I thought it was when I got into it.

If Modern is just a Legacy reboot, do accessibility and affordability even matter?

What we shouldn’t have to deal with as players is sitting around waiting for Wizards to reprint cards to make Modern less expensive only to see the opposite happen. There are plenty of other ways to play. We want answers. I think we’re entitled to them.

As I said, none of these things are going to change Modern overnight. They are simple by design, Wizards could essentially implement all of them tomorrow. At this point, they would be welcome changes.

Thanks for reading.

The Unwilling Speculators

There has been a lot said and written about the spikes in Modern card prices over the past few months, and much of it has been aimed at speculators. I completely understand the frustration with ever-increasing Modern card prices—I am a player and I feel it too. Until last weekend, I would have told you that this was a normal side-effect of Magic’s popularity and that speculators were not at fault.

After the DCI Banned & Restricted List announcement on Monday, I am ready to lay some blame. Not on the speculators, but on the people who are ultimately responsible for the health of this game (which includes the secondary market). The rash of spikes may be a normal side-effect to some extent, but I’m convinced now that mishandling by Wizards of the Coast is making things far worse.

Setting the Record Straight

Before I go there, I want to talk about the “blame the speculators” movement that’s been gaining traction over the past few weeks. I don’t think it is fair.

Now, not everyone uses the term “speculator” the same way. For some, a speculator is a market-manipulator, artificially propping up prices through buyouts and then cashing in. I assure you that this type of “speculator” is looked upon fondly by no one, myself and the writers at Brainstorm Brewery included. I’m not convinced that there is as much of this going on as some people think, but if there is then “speculator” is the wrong term anyway. Market manipulation is just that, there is no speculation involved as far as I can tell. I have no defense of this group, though I don’t think they are much of a problem either. Maybe if you are big enough to run your own tournament series you could do some damage with this method. Otherwise, it’s just stupid and risky and not as profitable as it might seem.

Others use the term “speculator” in a broader sense. Just about anyone buying, selling, and trading cards with profit motive can be lumped in, and that covers quite a range of people. This is the group that is being criticized unduly, in my opinion. Stocked up on rotating staples ahead of Modern season? Speculator. Picked up some Standard cards because your testing showed a potential breakout deck? Speculator.

God forbid you buy into whatever Modern card is being hyped on Twitter. May the seven plagues descend on your home for your role in the destruction of Magic: The Gathering.

Yes, I’ve heard some pretty dumb things said about speculators. Some of them were said by people who usually say dumb things, some weren’t. All of them boil down to this: frustration with constantly increasing and unpredictable card prices. I get it.

The root cause of these spikes is the explosion in Magic’s popularity. New players are pumping dollars into the game like a Street Fighter II cabinet in the 90s, and spiking prices just represent these dollars finding a home. If you think this foreshadows the end of Magic somehow, then we need your help. Please save us from all the money.

I wasn’t upset with the Modern spikes when they were happening, unlike some others. I felt that, for the most part, those spikes happened to cards that were due for increases. Modern is becoming an incredibly popular format and the cards don’t rotate. That means that there will be constant upward pressure on prices barring reprints, so you can’t durdle when buying the cards you need. I can only feel so bad for someone because Primeval Titan didn’t wait around at $7 until he or she finally decided to pull the trigger on a set.

The fact is that speculators are not the cause, they are the symptom. The money rushing in is making it quite profitable to buy, sell, and trade Magic cards, and there is nothing wrong with taking advantage of that as long as you do it with integrity.

Unregulated Market?

The bigger question is: why do these opportunities exist? Magic has never cheap to play but it has never like this, either. The volatility in prices today is remarkable, especially in Modern.

I get a kick out of it when people call the Magic secondary market “unregulated.” This is a market where a single company has unilateral control over supply and heavy influence on demand. While it doesn’t oversee each transaction, this company—if it was paying attention—could do quite a bit to control prices in the secondary market. That could make buying out TCGplayer a much less attractive proposition.

Although it’s hard to see, someone is regulating this market. They are just doing a awful job. And so:

Thanks, Wizards. I’m not one of those guys who blames WotC for everything, but this is a problem.

Wizards lit a fire when they created Modern, and it is obvious to me now that it is burning out of control. The format is more popular than they imagined and they have fallen woefully short of matching this with new supply. I keep picturing the scene in Office Space where Peter, Michael, and Samir find out that their program dropped $300,000 in the bank account the first day. Whoops.

Markets hate uncertainty and instability. The Modern market is insane because Wizards has done nothing but create uncertainty and instability. The banned and restricted update is just the icing on the cake (or should I say, gasoline on the fire).

Let’s recap this DCI Banned & Restricted List change and the events that led up to it:

  1. Wizards decided when they created Modern that they would be heavy-handed with bans, creating uncertainty about how long any particular card would be playable in the format (assuming it was a good card).

  2. Wizards then decided that they would keep the format fresh by regularly unbanning cards, creating uncertainty not only around what is leaving the format, but what is coming back in.

  3. Wizards scheduled the announcement for just a few weeks before the Modern Pro Tour. This created as much uncertainty as possible around what would be playable at the biggest Modern event of the year and then gave everyone a short window to acquire the new cards they would need.

  4. Wizards decided to unban a card that they knew was in short supply. This card was printed six years ago and left out of Modern Masters. Seems good.

Oh, and I don’t want to forget that [card]Bitterblossom[/card] spiked 50% ten days before the announcement. I don’t know for sure if it leaked, but I do know that [card]Jace, the Mind Sculptor[/card] didn’t spike. I know that [card]Ancestral Vision[/card] didn’t spike. And I also remember [card]Aluren[/card].

What did they think was going to happen? They could not possibly have aggravated the market more if they tried.

The truth is that Wizards didn’t think about the market implications at all. They don’t seem to have a cohesive plan to make Modern an accessible format, and if they did, they certainly wouldn’t tell us. Maybe we can look forward to Modern Masters II next year and [card]Tarmogoyf[/card] will drop from $250 to $200. Maybe they’ll just ban it. Who knows!? For their part, Wizards only needs a few more months of goldfishing Modern decks to figure out if Jace is safe to unban. Don’t worry, has them for only $400 each! Non-foil, of course.

If you are a Modern player, what are you supposed to do? New players and new money keep flowing in and Wizards keeps doing nothing about it (when they aren’t making it much worse). They have vaguely indicated that they don’t want constructed Magic to be “too expensive,” but what does that mean? The most played deck in Modern right now (Jund, according to is $1,700 in paper. Even if they wanted to reduce that, they have not shown the agility as an organization to keep up with demand.

Modern Masters gave us nothing more than a breather. Modern Masters II is a rumor and thought to be scheduled for 2015. It’s not enough. They aren’t getting the job done. What is a [card]Misty Rainforest[/card] going to cost in June of 2015?

All of this leads Modern players to the following conclusions:

  1. There is a very good chance that any particular Modern-playable card will never be cheaper than it is right now. Money and players continue to pour in. Reprints are coming slowly and they may not even reduce the price (‘Goyf, Bob). The cards won’t rotate. Buy Modern playables now, otherwise you might not be able to afford them.

  2. Cards that are not Modern playable now but are powerful enough to be playable in the right deck will probably never be cheaper than right now. Wizards has shown a willingness to shake up the format dramatically and unpredictably with bans and unbans which can pop these cards overnight. Buy potential Modern playables now, otherwise you might not be able to afford them.

  3. Cards that are on the Modern banned list will probably never be cheaper than they are right now. Wizards has shown the willingness to unban cards in Modern and these cards tend to skyrocket overnight. Buy banned Modern cards now, otherwise you might not be able to afford them.

Wizards’s inability to scale supply means that if you want to play Modern, you really should buy everything you need or might need right now. I mean that. It is very difficult to justify waiting on buying any Modern card right now. Prices are going up, up, up and there is very little relief in sight. It is a constant struggle to avoid being priced out of this format.

In this way, Wizards has turned every Modern player into an Unwilling Speculator.

So please, don’t blame the speculators.

Thanks for reading.


Size Matters

Magic specs are like steaks – the rarer the better. The fewer copies of a card on the market, the bigger payoff if a spec hits. Simple enough.

Sometimes, though, the color of the expansion symbol doesn’t tell you everything you need to know about supply. Sometimes you have to consider other factors. A few months ago, in Rare is the New Uncommon, I talked about how the year a card was printed is very relevant when estimating supply. Today I’m going to talk about how the supply of two rares printed in the same year can also vary greatly. It is commonly known as the “small set” or “third set” effect.

The conventional wisdom is that a small set (or third set) will be opened less than the first set in a block because it will be drafted less and just generally available for a shorter period of time. This means fewer cards in circulation, which means higher prices for the cards that do hit from those sets. [card]Jace, the Mind Sculptor[/card], we’re looking at you.

While everyone agrees that the small set phenomenon is real, we need to understand the magnitude. If we can’t figure it out, we can’t separate the small set factor from the other factors that drive card prices. Are eldrazi so expensive because they are in short supply or because they are awesome? They were in a third set, but it was a big set. Would they cost much less if they were in Zendikar? Or much more if they were in Worldwake?

Traditional is the New Novelty

Wizards hasn’t done many traditional block structures in recent years, which only complicates things. The last actual big-small-small structure (before Theros this year) was Scars of Mirrodin, and we’ve only seen the “traditional” block structure two of the last five years.

This analysis is going to focus mostly on drafting, though later on I’ll talk briefly about other considerations. To get started, we need to make a few assumptions. A quick note on assumptions: any time you are lacking full information, you will need to make them. They are never perfect, but that’s fine as long as they are directionally correct. We are trying to understand the magnitude of the small set effect, not peg an exact number of cards in circulation. If you are not comfortable making assumptions, you are resigned to know exactly nothing instead of knowing something valuable within a margin of error.

We’re going to assume that people draft uniformly throughout the year and that they always draft the newest format. I think these are fair. By doing this, we can boil drafting down to two key factors. The first is the amount of time a format is current, and the second is the ratio of packs in a given format.

An example will make this easier to understand.

Starting with Theros:

  • Triple Theros will have been the format for 19 weeks by the time it is done. Obviously, it consists of three packs of Theros.

  • Born of the Gods (BNG/THS/THS) will be the format for 12 weeks. That’s seven weeks shorter than the triple Theros format, and we’ll actually still be opening two packs of Theros for every Born of the Gods pack during this time.

  • Journey Into Nyx (JOU/BNG/THS) will be the format for 11 weeks.

Clearly, Theros is going to be opened a whole lot more than Born of the Gods or Journey Into Nyx. Now let’s do the math.

Since all we care about is the ratio of sets here (like I said, we’re not trying to estimate the actual number of cards or packs opened), the units don’t matter. I’m going to multiply the number of packs in the format by the number of weeks it is current to get pack*weeks, which is a nonsensical unit that is just going to drop out later. It gets us where we need to go. Using the numbers above:

THS: (19 wks * 3 packs) + (12 wks * 2 packs) + (11 wks * 1 pack) = 92 pack*weeks

BNG: (12 wks * 1 pack) + (11 wks * 1 pack) = 23 pack*weeks

JOU: (11 wks * 1 pack) = 11 pack*weeks

So if you are wondering how much Journey Into Nyx will be drafted in comparison to Theros, just take the ratio of their pack*weeks.:

JOU / THS = 11 pack*weeks / 92 pack*weeks = 12%

This means our estimate is that 12 packs of JOU will be drafted for every 100 packs of THS. For BNG that number is 25 (23 pack*weeks / 92 pack*weeks = 25%), or one for every four packs of THS. It means that about two packs of BNG will be drafted for each pack of JOU.

The numbers are pretty dramatic, in my opinion. They are especially interesting for the MTGO market. I am of the understanding that the vast majority of digital cards find their way into the economy through drafts, although we can’t know this for sure. If that is true, rares and mythics from Theros will be in huge supply compared to the rest of the block. Think of how that affects a cycle like the Temples. There could be four R/G Temples for each B/R and there could be almost ten for each U/R (when it is release in JOU)! Ten to one!

Keep in mind that this doesn’t tell us how many packs are being opened in an absolute sense, just in comparison to Theros. We’re fine with that, it still gives us the information we need as financiers.

Okay, but Can We Go Deeper?

Now let’s have some fun and expand the analysis to older sets. Since we’re working in ratios here, we need to do everything in relative terms and pick a baseline set. Theros is perfect. We set Theros equal to one, so every other set on this chart is in terms of Theros packs.

I’m also going to add a growth factor of 25% per year to represent the growing player base. So Theros is going to get drafted 25% more than Return to Ravnica, which is going to be drafted 25% more than Innistrad, etc.

Here is our chart:

Let’s make sure we know what we are looking at. According to this model, three packs of Theros will be drafted for every one pack of M14 (33%). Even though that format was triple M14, it was drafted for a much shorter time.

About two packs of Theros will be drafted for every one Innistrad pack (56%). The difference is caused by two years of player growth along with the fact that Innistrad was benched when Avacyn Restored came out.

Return to Ravnica was drafted less than Innistrad according to this analysis. Even with 25% growth in the player base, sitting out for Gatecrash held RTR’s numbers down.

Simple enough? Modern Masters was intentionally left out because of the limited supply.

Some things that jump out to me:

  • Nothing comes even close to being drafted as heavily as Theros will be. When you combine the fact that both Innistrad block and Return to Ravnica block had unconventional draft formats with the player base growth over the last couple years, Theros is getting drafted twice as much as the previous leader. I’m talking in the history of the game.

  • Dragon’s Maze was really, absurdly, painfully underdrafted. For real. Four packs to every 100 Theros.

  • Actually, it’s not just Dragon’s Maze. Small sets really are small. They weren’t lying. Look at Worldwake (5% of Theros), New Phyrexia (5%) and Dark Ascension (9%).

  • Large sets other than the first set in a block are comparable to the core sets from the corresponding year. For example, ROE was drafted about the same as M10 or M11. That’s good to know.

Even though all sets are in terms of Theros, you can compare non-Theros sets. It’s correct to say that, by this estimate, Avacyn Restored (21%) was drafted a bit more than half as much as Gatecrash (38%).

As always, use this as a starting point and tweak as you see fit. Innistrad was an incredibly popular draft format, so you might want to adjust that number up somewhat. It’s probably not going to change your conclusions, though.

Accounting for Non-Drafted Packs

I’ve already said I think you can use this model as-is for MTGO. In paper, you have to account for all the packs that get cracked by stores and casual players outside of drafts. I have no information on this, so it’s going to be a guessing game. I will explain how I think of it, although it is certainly up for debate.

I would start by adding a “base load” of paper cards. My thinking is that stores and casual players are going to buy up a certain amount of each new set, and that won’t really depend on the draft format or the size of the set. If I own a store, I probably need to bust X boxes of each new set to get the singles to support my Constructed players. I’d still need to get those [card]Voice of Resurgence[/card]s in my case whether or not anyone was going to draft the set.

We have to do everything in terms of Theros, so let’s just guess that two-thirds of Theros cards are being opened in drafts, leaving one-third to be cracked by stores. We’ll carry this fixed amount over for all sets. Your guess is as good as mine on the number. Here’s how it would look:

The red bar is the draft portion, the blue is non-draft product being opened.

Again, it’s all guesswork, but it should show you that the drafting differential is still relevant in a scenario like this, even if the effects are minimized somewhat. Now Innistrad reads at 70% instead of 56%. As you continue to increase the fixed portion (blue bars) and minimize the Draft portion, that gap will close even more. If Draft was responsible for only a very small portion of cards coming into the market (and I don’t think it is), then it wouldn’t matter much what was getting drafted and for how long.

In reality, the blue bars will vary as well. I’m sure stores sold way more Innistrad to casuals than Dragon’s Maze. This is just a starting point, but it’s more information than we had before. Almost any way you cut it, small sets are opened far less than first sets. And Theros…well, we are swimming in it, what else can you say?

That’s quite a bit for this week. Thanks for reading.


Anthony Capece – Going Deep

I am not really one for the called shot in Magic finance. Aside from the fact that there is no accountability whatsoever, I’m not the type to deploy my capital based on one person’s opinion (unless that person is me). I read two or three Magic finance articles each week that use this methodology for specs:

“Card X is $5 right now but it should go to $10 (or some other arbitrary price) in some vaguely defined time frame that we can all agree is in the future. Just look at Card Y for proof and ignore the fact that it is a fundamentally flawed comparison and these cards have nothing in common. For further proof, see the recent increase in price of Card Z, which hindsight bias allows me to say was super obvious even though no one actually saw it coming. Anyway, if Card X catches on in whatever new deck is out there, though I have no reason to believe it will, we could be looking at $20. In closing, I’ll point out that casuals and EDH players will love this card, even though they won’t, making it a can’t-miss spec. Now let’s look at 15 other cards, so that even if I hit on one of the calls in this article, you will have a very slim chance of guessing which one it is.”

It’s impossible to convert a hundred poorly supported opinions into a good Magic finance plan. I won’t invest in anything I don’t feel like I understand very well, so called shots don’t have much value for me.

I’m going to talk about individual cards today, but instead of glossing over two dozen possible specs and tossing out a dollar figure for each, I’m going to dive deep on just a few cards. You will have a good understanding of how I reached my conclusion, so you can decide if you agree or disagree up front and act accordingly. Also, I’ll point out when the analysis is transferrable. If you understand the dynamics of [card]Snapcaster Mage[/card], for example, you really understand the dynamics of the post-rotation large-set Modern-staple rare. That means that [card]Deathrite Shaman[/card] and [card]Thoughtseize[/card] are going to fit neatly into the same bucket.

So without further ado:

[card]Snapcaster Mage[/card]

As one of the most played cards in Modern, many financiers were looking forward to nabbing this card at a post-rotation discount. It stayed in a very tight range of $23-24 (all prices TCG Player mid unless otherwise noted) for most of its Standard life and has now dropped to about $19 with signs of leveling off. Snapcaster is a cornerstone creature of Modern, along with [card]Tarmogoyf[/card] and [card]Dark Confidant[/card], and conventional wisdom says that the price will eventually reflect this.

I’m staying away from this card, though. I think most people are falling into the trap of demand-only analysis with Snapcaster. I am in full agreement that Snapcaster will be a key card in Modern going forward, but demand isn’t the story here—the huge supply is. The card may look similar to Bob or ‘Goyf in playability, but the supply is drastically larger and that is going to keep the price down for quite a while. In fact, Snapcaster should not be compared to those cards at all. Take a look back at my article Rare is the New Uncommon for more on this.

Working against Snapcaster is that its Modern playability has been priced in for a long time. It was obvious from day one that it would be a Modern powerhouse, so most Modern players already have their set and aren’t letting go. Look at [card]Restoration Angel[/card] for comparison—it’s also a rare from that block that sees some Modern play, but players are clearly taking a wait-and-see approach with it. Sell it now, buy it back later if you need it. There is no question whether you need Snapcasters to be competitive in Modern, and that is why Resto lost almost 75% of its peak value while Snapcaster took a smaller 20% cut. This is a great card that will always be relevant in Modern, and that’s exactly why it’s priced at $19. There is no post-rotation discount to be found.

Snapcaster’s Modern saturation also severely limits the upside from a demand perspective. You really can’t play Snapcaster in too many more decks than it’s already in. What that means for a financier is that any meta shift in your favor will only bring an incremental price increase. There is no scenario where you double or triple up on Snapcaster any time soon and this is actually a pretty big negative in my eyes. You need some of your specs to hit big to be successful in Magic finance, so investing a bunch of money into something that has zero potential to do so is not usually a good plan. Especially at $19 a pop.

Opportunity cost is one of the most critical concepts in Magic finance. The game is exploding in popularity so virtually anything playable you buy is going to increase in value over time barring reprint. But as I’ve said before, a good Magic financier doesn’t spend his time finding good specs, he spends his time picking great specs out of a sea of good ones. I don’t doubt that you’ll make some money on Snapcaster if you hold it for several years, but I think you can make a whole lot more elsewhere.

At $19, I won’t go near Snapcaster—it’s way too expensive considering how many are out there. It’s a perfectly good time to buy a playset for Modern season, but that is where I would stop. If I had to guess, I’d say it will see a pretty drawn-out bottom and then drift back up into the low-mid $20’s over the next year or 18 months. That’s definitely not worth the huge investment this card would be at $19 per copy. [card]Snapcaster Mage[/card] is very much the prettiest girl at the bar this rotation, and I’m afraid we will have to find our value elsewhere.

As I mentioned above, much of this analysis will apply to [card]Deathrite Shaman[/card] and [card]Thoughtseize[/card] when they rotate. I’m more excited about Deathrite because the lack of Standard play is keeping it at a much more reasonable price, and also because Return to Ravnica was on the bench for a while during Gatecrash. [card]Restoration Angel[/card] is similar in some ways. It sees much less Modern play but also comes much cheaper, and there are fewer out there. Like Snapcaster, I think it lacks big upside, but $5 is a lot less than $19 ,so I think it’s a fine spec.

[card]Craterhoof Behemoth[/card] and [card]Entreat the Angels[/card]

For all the same reasons I’m cold on Snapcaster Mage, I am excited about these cards.

These are third-set mythics, so right off the bat there are maybe half as many of each of these cards in existence as there are Snapcasters. Second, they are both under $5 as I write this [Editor’s note: Craterhoof Behemoth has ticked up to $7-8 since Anthony’ submission. Pay attention to this guy!]. That combination of small supply and low price tells me that these cards are powder kegs—if an uptick in demand ignites them, they will explode.

If you go back and look at Scars block, you will see that mythics bottom quickly and even fringe eternal playability (or strong casual playability) is enough to move them to the $7-10 mark a year after rotation. These two cards meet that requirement, both seeing Legacy play, so in the worst case you will be able to trade these away for a small to moderate gain a year from now.

The real seller is the upside, though. Both [card]Craterhoof Behemoth[/card] and [card]Entreat the Angels[/card] are exceptionally powerful and unique cards. Craterhoof is the single best card for a creature-combo kill and Entreat uses a potent mechanic that we may not see for a while due to the mixed reception it received (and the tough flavor fit). These cards are good enough for Modern but priced a notch above bulk. If they hit, the payoff will be big. This is exactly the risk/reward profile I am looking for—minimal downside with a chance to double or triple up within a year if things go well.

[card]Craterhoof Behemoth[/card] is already starting to tick up in paper, and it’s over 10 tix on MTGO. I’d be the first to tell you that a “sure thing” doesn’t exist in Magic finance (or life), but I can say that you won’t find a better candidate for the next spike than this card. Any appearance in a good Modern deck or just another Legacy top eight might be enough.

Entreat is a little more of a sleeper, but I still like it. The main reason that this card doesn’t see Modern play is the lack of card filtering—[card]Sensei’s Divining Top[/card], [card]Ponder[/card], [card]Brainstorm[/card], etc. really make this thing go in Legacy. There is a chance the scry cards in Theros get us there. Would a full set of scry lands plus [card]Magma Jet[/card] be enough to make miracles work in Modern? If not, how many new Modern-playable scry cards would we have to see in Born of the Gods or Journey into Nyx before UWR control with Entreat and [card]Terminus[/card] is viable? It goes without saying that Entreat will spike overnight if they ever unban [card]Ponder[/card] or [card]Preordain[/card] in Modern.

I can’t really say that [card]Craterhoof Behemoth[/card] or [card]Entreat the Angels[/card] will take off in Modern over the next year. I don’t predict demand. What I’m looking for is the risk/reward profile. Even if Entreat or Craterhoof don’t break out, you will probably make as much in the first year as you would have with [card]Snapcaster Mage[/card]. However, these cards come with a very special bonus that Snapcaster doesn’t—enormous upside. You just can’t pass that package up at $5. Heck, third-set mythics don’t even really need to do anything at all to spike to $30 (I’m looking at you, [card]Phyrexian Obliterator[/card]). Both of these cards are better than Obliterator, and they are dirt cheap.

Powerful mythics that get this cheap are always worth looking at. There are others in the Innistrad block that are good buys, although I don’t think they have as much upside. For example, the ship has sailed on Griselbrand.

Well, I’m already at my word cap so it looks like we’re stopping at three specs today. I’ll write more of these columns in the future if the feedback is positive.

Anthony Capece – Anatomy of a Spike

The price spike can be the most exciting, terrifying, confusing, profitable, and potentially disastrous phenomenon in Magic finance. It’s equal parts the reason we do this and the thing we hate most about it. With [card]Splinter Twin[/card] still fresh on everyone’s mind, today I’m going to talk about what causes these spikes, how you can prepare for them, and how you should react when you see them.

If you haven’t listened to the most recent episode of Brainstorm Brewery, I recommend you do that before continuing. It’s a good primer on [card]Splinter Twin[/card] and some previous price spikes.

I’ll start by dividing price spikes into three categories:

  1. Real demand spikes

  2. Price corrections

  3. Speculative spikes

Understanding the differences and being able to recognize the type of spike in real time is critically important to a financier.

The Real-Demand Spike

This  type of spike is the easiest to identify and explain. It happens when any card sees a large, sudden increase in real demand. When I say “real demand,” I mean playability-driven demand. This usually means that someone just crushed a major tournament with it – see [card]Nightveil Specter[/card] at Pro Tour Theros for a great recent example.

Here, demand increases sharply as players try to get their hands on the new tech (while supply remains unchanged), leading to a price increase. It’s simple and fundamental, and in that way a real-demand spike seems like the most “legitimate” type of spike.

How can you predict these? It’s hard, and you have to keep your ear to the ground. At the very least you should be combing decklists from any major event and following pros on Twitter, and you might even try brewing and testing yourself. If you had spent the week before Pro Tour Theros testing Standard, or if you knew some good players who were testing and could give you their results, you may have figured out that the blue and black devotion decks were the real deal before the tournament. Easier said than done, but not impossible.

It’s generally fine to buy into these spikes on two conditions. First, you have to verify that the demand is legitimate. You might use event coverage or a player source for this. Then, you have to make sure you are getting in at the ground floor or very close to it to ensure that there is an opportunity for profit.

If you can’t find any evidence that the card is actually breaking out, do not buy in. There are not that many ways to lose a lot of money quickly in Magic finance, but buying in to a spike at elevated prices only to find out that the demand wasn’t real is one of them. The fact that a card is “good in testing” is not enough on its own, you really need it to place in a major tournament or get some camera time. Also, if the price has already increased substantially, I would advise against buying in. Your profit will be limited at that point, and there is downside risk if the metagame shifts quickly. Wait for the next one.

A card that has seen a real demand spike will hold its new price as long as the demand stays in place (in other words, as long as the deck is still good). There is a such thing as a “one event deck,” so be careful.

Before I continue on, I want to point out that the next two types of spikes are often confused. It can be very hard to tell them apart when they are happening, although hindsight will always clear it up (for as much help as that is). Most people can identify a real-demand spike easily enough, but you will really have an advantage if you can tell a price correction from a speculative spike in real time.

The Price Correction

A price correction is a sudden increase in the price of an undervalued card without a clear catalyst. This means that supply and demand already indicate that the card should be more expensive, and the spike is simply the market waking up and realizing it. If you aren’t paying close attention, these seem to happen out of nowhere.

I think the fetch lands are a good example here. The fetch lands have been the cornerstones of Modern since day one, so why would [card]Misty Rainforest[/card] spike last fall around the release of Return to Ravnica?

It wasn’t a real-demand spike – Misty was never not one of the most played cards in Modern. It was just a collective realization by the market that one of the most important cards in the format was a little on the cheap side.

Determining whether or not a card is undervalued is very difficult in its own right. Suffice to say that you must be able to back up any claim that a card is undervalued. “This card is way too good to be $5” is not a compelling case.  Further, identifying that a card is undervalued does not tell you when it will spike, just that it is likely to get back in line with other cards at some point in the future. Don’t forget about supply here – a very good card can be inexpensive and fairly valued if the supply is large enough.

The quickest and easiest way to tell if a card is undervalued is to use comps. Two weeks ago, if you were to compare Splinter Twin to other small-set rares printed around that time that see significant Modern play you may have used this list: [card]Celestial Colonnade[/card], [card]Birthing Pod[/card], [card]Spellskite[/card]. Colonnade was $10, Spellskite was $8 before also jumping, and Pod was a little over $5 (note that Spellskite and Pod were printed a year later and thus have a larger supply). Based on those prices, you would have concluded that Twin was slightly undervalued at worst and had plenty of upside at under $5. I believe [card]Splinter Twin[/card] was a textbook price correction.

If you look back at the [card]Misty Rainforest[/card] chart, you can see that it resumed its normal growth after the spike – this is a clear indicator of a price correction. After snapping back in line, the card returned to what it was doing before. The market sometimes overshoots on spikes but, in general, price corrections are supported by supply and demand fundamentals and should hold up well.

I would buy into price corrections under the same conditions as real-demand spikes.  Make sure it’s real (check your comps) and make sure you aren’t too late. Ideally, though, a good financier need not buy into price corrections after they have started – he should already have plenty of copies in his binder. Remember, all the information you need to identify the undervalued cards is out there beforehand, you just have to put it together before the rest of the market.

The Speculative Spike

A speculative spike is basically a bank run on Magic cards. It is not demand driven at all, in fact just the opposite. A speculative spike is ignited by a lack of supply (illiquidity), which is often caused by a buyout. This can lead to “fake” prices as the very few copies left on the market get re-listed at arbitrary new highs.

Let’s step through one of these to help us understand it.

  1. Someone buys most or all of the available copies of a card. This is really not practical with newer cards because of the print runs, so it is almost always an old card. We’ll use [card]Aluren[/card] as an example.

  2. Now that supply has disappeared completely, anyone who has this card sitting around will rush to list it. The problem is that there is no information on what price is appropriate for the market. If the market sold out of [card]Aluren[/card] at $5, any price higher than that is fair game. The sellers choose an arbitrary price, in this case $25.

  3. Ostensibly, the new price of the card is $25, but who is buying? No one really wanted this card at $5 except for the buyout agent anyway. Very few copies if any will sell at this price, which is why many people refer to it as fake.

  4. The people who will buy at the new price are those buying out of fear (missing their last chance at the card) or greed (hoping to find the Greater Fool that Jason talked about in one his articles). The buyout agent is depending on these people to help him cash out. The most important thing is that you are not one of them.

  5. The price slowly comes back down as people realize that there is nothing to support this card at $25. If the buyout agent found some panic buyers, he made some profit. If not, he has a ton of [card]Aluren[/card]s that are once again $5.

The buyout agent is not necessarily malicious. In the case of [card]Aluren[/card], there was speculation that an [card]Imperial Recruiter[/card] reprint would make the [card]Aluren[/card] deck more popular in Legacy. If that had actually happened, we would be looking at a real-demand spike. As it was, most savvy financiers recognized that the [card]Aluren[/card] deck wasn’t even very good to begin with.

Don’t think that people are making a ton of money like this. Remember how difficult it can be to out a ton of cards in time to catch a real-demand spike. Now imagine trying to do that with $20 [card]Aluren[/card]s that nobody wanted at $5. Buylists often don’t adjust in these situations, they just wait it out. Trying something like this is just as dumb as it seems.

Telling Them Apart

This is where, in my opinion, you can really level up as a financier. It is easy to see the differences between the examples above in hindsight, but can you do it in real time? When prices are spiking, you have to move quickly if you want to participate. Here are some guidelines:

  1. Identify undervalued cards ahead of time. If you already know a card like [card]Birthing Pod[/card] is undervalued, you won’t need to think about it when it spikes. And even better, you can make sure you have plenty of copies.

  2. If you do not see the spiking card as undervalued, then always, always, always verify the demand. If you do not, you risk buying into a speculative spike, and it is far better to miss a price correction than it is to buy into a speculative spike.

  3. Watch for the signs of an oncoming price correction if you are still struggling. The spike happens when the market wakes up, but there are usually signs of the market rolling over and yawning first.

A week before the actual spike, there were signs on eBay that the price on [card]Splinter Twin[/card] was moving. Similarly, the cheapest copies of a card disappearing on TCGPlayer is a good indicator. Word on Twitter was that Twin’s price had jumped in Europe the week before. If you see these warnings signs, even if you don’t view the card as undervalued, it points toward a price correction instead of a speculative spike. Speculative spikes are dependent on removing most or all of the supply at once, so there is rarely that much warning. It tends to be more like, “I woke up this morning and the internet was sold out of Alurens.”

Once you identify a speculative spike, stay away at all costs. If you are not 100% sure what you are dealing with, don’t buy! Here is an example of something that looked a lot like a price correction but seems to have been more speculative in hindsight:

Trust me, you are not a happy camper if your binder is full of $80 Force of Wills that you bought because “it was your last chance before they went to $100.” When in doubt, especially with older cards, don’t buy. Getting stuck in one of these is the actual worst thing you can do in Magic finance.

The Mix

I’ll add one final nuance and then call it a day. You may see elements of all three categories of spikes mixed together at times. Commonly, a real-demand spike will have a speculative element tacked on, causing an overshoot. [card]Master of Waves[/card] is a good example of this – Pro Tour Theros was definitely responsible for the initial jump, but you still had plenty of people buying vendors out at $15 because they didn’t want to miss the next Jace. As a result, Master came down significantly from its high but still settled at $12, which was double the original price.

[card]Shared Animosity[/card] is one that I see as a speculative spike on an undervalued card. Sure, $7 is way too high for a card that doesn’t really see play, but at the same time $0.50 for an old rare that has potential to be Modern playable is too low. This one is still shaking out and I expect it to come back down quite a bit, but not all the way to near-bulk.

Since this article is already very long, I’ll be talking about other cards that I think are due for price corrections on Twitter this week. Don’t worry, I’ll come up with something more creative than [card]Spellskite[/card] and [card]Birthing Pod[/card]. (But for the record, Pod is a decent target and I would lay off of Spellskite now that it has moved again.) Follow at @acmtg.

Thanks for reading.

Anthony Capece – Modeling Uncertainty in MTGO (How Much Do You Trust Worth?)

There was a pretty significant change to MTGO last week. Wizards shut down all daily, premier, PTQ, and MOCS events indefinitely. Where there is change there is uncertainty, and where there is uncertainty there is opportunity. We’re all on the same page here – we want to take advantage if card prices drop. Unlike most Magic specs, though, there is a non-zero chance of this one having really bad outcome, an outcome where we buy in and prices crater, costing us a bunch of money. How do we approach it?

Here’s what I’m not going to do in this article: I’m not going to try to convince you I know what will happen. Nobody knows exactly how things will unfold, probably not even Worth and the Wizards MTGO team, and least of all me. If you want opinions on what will happen, Twitter is lit up like a Christmas tree.

An uncertain situation like this calls for examining probabilities instead of trying to predict a specific outcome. When you flip a coin, you have no idea what side will land up, and no one would ever claim to be able to predict coin flips. But you know that the probability is exactly 50% of either side coming up and that gives you enough information with which to work. Poker is the same – good poker players don’t try to guess what the flop will be, they think about all the possible outcomes and the likelihood of each and bet accordingly.

You probably already have an opinion about what will happen with MTGO. But do you have a plan? Or are you just going to stare at all the red on until “it feels right” and pull the trigger? This isn’t like watching a card bounce up and down in its range – price history goes out the window if the fixes don’t go well. In this case, you may see a lot of people take the “dump my MTGO collection for whatever I can get and buy, you know, real cards” approach. I have to tell you, it makes a lot of sense. Then again, maybe it will just blow over and MTGO events will be up again soon. The point is, we really don’t know.


In this article, I’m going to show you how to build a very simple expected value (EV) model that takes what you think will happen and turns it into a plan for buying or not buying into MTGO (actually, I’ve already built the model for you). You are going to input the parameters, they are going to be your guesses based on the information that you have. This works out best because if you get it right you will be super proud of yourself, and if you miss there is really no one to blame but yourself. It’s your money, after all.

Disclaimer: if you are familiar with expected value and good at Excel models, you probably already have something like this. And if you are a seasoned trader, you might not need something like this. Your intuition is probably good enough. If you are thinking, “I really don’t have much confidence in the MTGO product, but at some point these cards have to be a good buy. I just don’t know when that is,” well then, bingo.

This model is going to tell you what your buy price is for any particular card based on the possible outcomes of the MTGO situation and the probability (that you assign) of each scenario. I like this model best for non-redeemable cards. Redeemable cards are going to be linked to the paper price, at least loosely. No matter how bad things go on MTGO, you can always cash a set of digital Theros in for paper cards and go play, and that will provide a floor for the digital versions. MTGO will continue to serve this function regardless of whether or not the events are stable. Our approach will work much better for Modern sets (other than Innistrad block, which is still redeemable). Their only value is their playability on MTGO. It’s not to say you couldn’t adjust the numbers to better reflect redeemable sets, just that I didn’t have that in mind when I made it.

Potential Outcomes

We’ll start by listing the potential outcomes of the current MTGO situation and how they would affect card prices. If any of these scenarios seem off to you, don’t worry. You can add different outcomes and change the numbers as you see fit.

My take on it boils down to three possibilities:

1) Wizards gets MTGO fixed and back online quickly. In this scenario, Worth’s update at the end of the year is basically “it’s fixed and coming back very soon.” All the players return and the prices bounce right back to where they were prior to the shut-down announcement. You sell anything you bought on a dip at full retail and enjoy the profits.

2) Wizards gets it fixed, but it takes longer than anyone really wanted. In this scenario, Worth’s update is something like “we’ve figured it out, but we need more resources and it’s going to take a few more months.” MTGO actually loses some players as a lot of people decide they aren’t going to wait it out, dump their cards, and officially move on to Hearthstone or League of Legends or just paper Magic. Prices recover to about 75% of their original price when the events come back. If you bought low enough, you make some money. If you jumped the gun, you lose some money.

3) They don’t figure it out in any reasonable amount of time. Maybe they hire new developers and they all quit after a month, putting them back to square one. The end of the year announcement is “we’re still working, please stick with us, but we have no idea when this is going to be fixed.” I’m sure it would be accompanied by some underwhelming consolation prize like cheap cube drafts until events are back (actually, I wouldn’t mind that). This is the doomsday scenario where everyone but the most die-hard players lose confidence and bail. Prices plummet to 25% of their original price because no one is going to leave money tied up in a system with no real timeline for return. If you bought in at anything but rock bottom, you probably lost a lot of money.

Maybe you think there should be another scenario between two and three, a really-bad-but-not-doomsday scenario. If you want to go deep, add even more scenarios. Or maybe you think prices settle at 50% in scenario two instead of 75%. If you want to simplify, you can take it down to two scenarios: “MTGO lives, prices recover to 100%,” and “MTGO dies, prices plummet to 10% original value.” Make your notes, you can always change the model later.

By they way, if I was trying to do a version for Standard (redeemable) prices, I would want to make the floors a lot higher to reflect redemption (so even in the worst case scenario, prices only drop to 80% of their original price or something along those lines). Just don’t mix redeemable and non-redeemable, I think they are going to behave very differently if things get bad.

Now we estimate how likely each scenario is. This is where it becomes your model. If you are an optimist and you think there is a really good shot they fix it by the end of the year, give scenario one an 80% likelihood. If you are a developer and understand just how hard this is going to be but still think it’s doable, maybe you weight the second scenario higher. If you are risk averse and really can’t afford to lose money on MTGO, be conservative and rate scenario three at 50%. Your call. Just make sure they add up to 100%.

Personally, I’m guessing there is a 50% shot at the first scenario, and about a 45% at the second. I’m not sure how long it will take, but I think they’ll fix it. It won’t surprise me if some players never come back, but I think they’ll get it done before players flee in large numbers. So I think the doomsday scenario is only 5%.

Now open the spreadsheet (you have to enable macros). The card I’m looking at is Misty Rainforest (23 tix prior to the announcement) and it has all the assumptions I made above. Obviously, you can change the card, just find the pre-shutdown price on Hit the “Run It” button and presto, it spits out 19.55 tix at the bottom.

19.55 tix is the price at which my expected value is zero. If my assumptions are right, on average, I will make money if I buy below 19.55 tix and lose money if I buy above it. So I know that once Misty Rainforest falls below that price, I’m in my buy zone.

A word about expected value if you are unfamiliar: EV tells you what you can expect to gain or lose on average if you repeat the scenario many times. Again, think poker. You get dealt pocket aces and it means that you are a favorite to win that hand. You usually make money on that hand, but not always. There is only one outcome to each hand, but if you average all the hands where you are dealt pocket aces, you usually win a good bit of money (though you do occasionally lose when someone hits a straight or something). You have a high expected value with pocket aces, but that does not mean you are guaranteed to win money. This is a crucial point.

In poker you get to play hand after hand, giving you a large sample size – we only play this game once. Because of that, I would strongly advise against using this model as a hard buy/sell indicator. It is going to give you one piece of information to consider when making the decision, it is not going to make the decision for you.

You’ll find a lot of value in just plugging tons of different assumptions in and running the model over and over. It will help you put everything in context. What’s the worst that could happen (take scenario three up to 95% likelihood)? Misty would have to get all the way down to 6.6 tix to break even on your expected value. What if Magic players really are addicts and don’t sell off their cards no matter what (set cards to drop to only 95% of original value even in the worst scenario)? The model says 22.4 tix, meaning buy on any small dip. Even as I write this, though, cards are dropping more than that.

After trying lots of iterations, you will get a feel for what is reasonable. You either have faith in Worth and Wizards, or you are willing to bet against them. If your assumptions say that you feel good about MTGO getting fixed, the model will tell you to buy on small dips (break even price will be high). If you are pessimistic about it, it will tell you to wait until cards get very cheap to hedge against the worst case. Remember, it’s giving you the EV = 0 price. You actually want to buy in cheaper than that.

All the spreadsheet does is calculate the profit in each scenario you input, weight that profit based on the likelihood of the scenario, and then solve for a card price. I say “all it does,” but I personally find these things incredibly valuable. It’s a great tool for quantifying the mess of information floating around in my head. It stops me from running too far in one direction and from making buys that aren’t consistent with what I think will happen in the future.

Taking Action (Or Not)

After you’ve finished with the model you just wait and watch. When new information comes out, update your model. If Worth gets fired in mid-December and flames Wizards on Twitter, you might want to bump up the likelihood of that third scenario and run it again. If you hear that they are bringing in some MTGO grinders to help test, there’s a pretty good chance they are making progress. Adjust accordingly. If we don’t hear anything, well, your guess is still as good as mine. By the time you read this, prices will have done something. They are either dropping fast or holding firm or something in between, but they are doing something, and it’s going to give you valuable information. It’s telling you what other people think the outcome is going to be.

Wait, watch, update your assumptions, and then when something gets pretty out of whack with your model, buy. If your model tells you 20 tix is break even on Misty based on your assumptions and the current price is 15 tix and dropping, consider buying. The model is telling you that the market is less confident in a fix than you are. If you are right and they are wrong, you will profit.

Leave a margin of safety (don’t buy right below your break even price). Understand that cards might not get as cheap as you need them to in order to feel good about investing in a bunch of digital objects on a buggy platform. In that case the model is telling you to sit tight. Also understand that if prices don’t drop at all, there just won’t be any opportunity. Spending ten minutes running every scenario you can think of is really going to help you picture these outcomes. If the opportunity does come, you should be able to recognize it.

Thanks for reading.

Download the model here–MTGO Breakeven

(Reminder – you have to enable macros for the model to work. The excel sheet probably isn’t that hard to break, either. Just keep a clean copy saved and re-open it if the macro stops working for any reason.)

Anthony Capece – Rare is the New Uncommon

I’d like to discuss the rise in price of Modern staples over the past few years and why I believe that more recently printed Modern staples – [card]Deathrite Shaman[/card] and [card]Thoughtseize[/card], for example – might actually be traps.

Let’s start here: “Past performance does not indicate future results.”

It’s one of those nuggets of investing wisdom that you’ve heard a thousand times, but how does it apply to Modern cards? What we’re saying here is that the factors that caused an investment to be good or bad in the past (in this case referring to the huge spike in Modern prices) may or may not remain in place going forward. If they do, we can expect similar results. If they don’t, we can’t. So let’s talk about the factors that contributed $130 [card]Tarmogoyf[/card]s and the like.

First, take a look at what has happened to the Magic: The Gathering player base over the past several years. Hasbro said in their 2012 annual report that the player base stood at 3.3 million, and that Magic had seen 25%+ annual growth in revenues for four years in a row. We can make a few assumptions here, understanding that these numbers are inexact and only intended to put us in the ballpark. If you run 25% growth backward, here is what the player base would have looked like each year (in millions):


Players (mil)


Shards of Alara






Scars of Mirrodin






Return to Ravnica


Hasbro has already said that 2013 continued on this trajectory, so today we might be looking at something like 4.1 million Magic players. Think about these numbers for a minute. There are 1.5 million players who have picked up the game since Innistrad, which just left Standard. That was almost the entire player base during Zendikar block! If 2014 continues on this pace, we’ll add a million more – staggering.

The next assumption I’m going to make is that Wizards is scaling their print runs according to these increases. Again, it may not be perfect, but I think it’s reasonable to assume that they are printing at least 25%-30% more cards each year to meet the demand from new players. I certainly haven’t heard about a shortage in booster packs.

The supply implications are that there could be three copies of [card]Snapcaster Mage[/card] out there for every two copies of [card]Arid Mesa[/card]. There are two [card]Deathrite Shamans[/card] for every [card]Marsh Flats[/card]. It’s reasonable to think that there will be four copies of Theros [card]Thoughtseize[/card] for every one Lorwyn copy! It’s time to rethink rarity.

As for the spike in Modern cards over the last few years – the demand for Modern right now is based on a player base of four million and the supply of fetchlands is based on a printing for 1.69 million players. So, they are expensive. Simple enough. But the supply of [card]Deathrite Shaman[/card]s is based on a printing for 3.3 million players. Not nearly as expensive. Demand for Magic cards has increased dramatically over the past few years, but so has the supply of new cards. You can’t overlook this if you want to be a successful Magic financier.

Check out this chart to illustrate. Warning – we’re switching to MTGO. I understand that paper is different, but I’m using MTGO to make a point about supply. Looking at, I chose a series of Modern staples – one rare from each block – that all see a similar level of play (dominance ratings of 16-22%) and plotted their prices. These are some of the most played cards in Modern, and the goal here is to fix demand so we can see how supply, on its own, affects price. There is a hole where the Shards staple should be because it doesn’t exist.


Looks a little bit like the inverse of this graph of the player base, doesn’t it?


I know some of these cards see play in Legacy and that clouds the picture somewhat, but Legacy has a small effect on MTGO ([card]Stoneforge Mystic[/card] is 1.3 tix and [card]Jace, the Mind Sculptor[/card] is 25% of his paper price). I used the price of [card]Thoughtseize[/card] from just before it was announced in Theros, but all other prices are current. I think the chart illustrates the point very well: Modern staples show a clear downward trend in price online as you move forward in time.

If demand for each of these cards is about the same on MTGO, the differences in price are necessarily caused by supply. There are just way, way more Snapcasters and Deathrites out there than there are [card]Tarmogoyf[/card]s (obviously the Modern Masters reprint added very little supply). I think everyone knows that but I don’t think everyone understands the magnitude and what it means going forward.

Modern staples like [card]Tarmogoyf[/card] and Modern staples like [card]Deathrite Shaman[/card] are just not comparable financially. If you are looking at Deathrite and thinking that it will follow [card]Tarmogoyf[/card]’s trajectory because they see similar levels of play in Modern (and Legacy), think again. There could be as many as three Deathrites for each ‘Goyf in existence. We should be comparing [card]Deathrite Shaman[/card] to [card]Kitchen Finks[/card] instead.

The Modern player base has quickly outgrown the print runs of Zendikar and sets older. It hasn’t outgrown the print runs of newer sets like Innistrad and Return to Ravnica. But will it?

Let’s go back to what I said at the beginning of this article – past performance does not indicate future results. If you think that Snapcaster and Deathrite are going to follow the same trajectory as [card]Tarmogoyf[/card] and (pre-reprint) [card]Thoughtseize[/card], that means you think that the player base will keep increasing at 25% per year for several more years. That is what caused the initial climb, and that is what will have to happen again for new cards to climb in the same way.

The bad news is that the growth of the player base is going to level off. It’s not a matter of “if” but “when.” No business can grow at 25% annually forever, and Magic is no exception. I don’t know when it will happen, but stringing together four years of 25% growth is already a great feat. I will not be surprised if it continues for another couple of years. I will not be surprised if it cools off next year. I will be surprised if it continues for many more years. That would bring us to ten million players in four years. It would mean adding 2+ million players between years three and four of that run (2017), which was almost the entire player base during Scars of Mirrodin. That is a lot of Magic players.

When (not if) we enter this cooling-off period, the most recent blocks are going to be in massive supply compared to past sets. The player base will not grow fast enough to make them scarce the way Zendikar fetchlands or Future Sight [card]Tarmogoyf[/card]s are scarce today. If you are holding a box of $15 Theros [card]Thoughtseize[/card]s that you are holding for when they go back up to $50, just understand that we need to double the number of Magic players on Earth first. Go ask Jason Alt about bagholders – and try to recruit some new players on the way, because we need them.

Magic financiers spend a lot of time trying to understand demand. We research formats, evaluate cards, and on and on. But that’s only half the equation. If you put the same focus on supply, you realize that we are going to be drowning in Theros cards by the end of the block. It’s going to take years of strong growth for demand to get to the point where [card]Thoughtseize[/card] can recover. After all, it’s probably about as rare as [card]Inquisition of Kozilek[/card] at this point.

There are already hints of the oversupply of more recent sets if you look. Scars of Mirrodin block was printed right in the middle of the player-base explosion. People keep wondering why the Scars fastlands aren’t jumping, even though they see play in Modern. [card]Birthing Pod[/card] is one of the most dominant decks in Modern but you can still buy them for $4 on TCG Player. We keep waiting for the spike, but I no longer look at that as a sure thing. Maybe there are enough [card]Birthing Pod[/card]s to go around. I’ll be watching these cards closely, along with [card]Snapcaster Mage[/card] and [card]Deathrite Shaman[/card], when Modern season hits.

To be clear, I’m not saying that growth is slowing. I’m saying that when it does, whatever the recent sets are at the time will be in huge supply. No matter how much those cards are played in Modern, they will never reach the heights that we have seen in the past.

Now, don’t fret. It doesn’t mean there isn’t money to be made. You may have noticed that I’ve mentioned large-set rares almost exclusively. The mythic rarity certainly changes things, as do small sets and core sets, and of course we can always spec on older cards. I’ll go into more detail on this topic in my next article.

Thanks for reading.