Collectibles, including Pokémon cards, have become a hot commodity in the alternative investment sphere. However, before delving into this niche investment community, it’s important to understand how to invest, the ideal timeline, and which type of cards you should purchase. In most cases, collectible investments like Pokémon cards should always be held with a long-term view.
If you were around in the 1990s, you probably remember the rise of Pokémon. In many cases, people first familiarized themselves with Pikachu, the lovably cute video game character that would occasionally emit electricity from his body. The 1990s also saw the rise of two important trading card games, Magic the Gathering and Pokémon. These games allowed you to buy booster packs of cards, play against your friends and collect the cards.
At the time, no one could foresee the future — that one day, these cards would be worth a lot of money. In fact, the global market for trading collectible Pokémon cards is over $400 million, and a rare 1998 Pikachu card sold in February 2022 for a record-breaking $900,000.
The pandemic renewed interest in Pokémon
During the pandemic, trading card values increased tremendously, and Pokémon led the way. In fact, according to Bloomberg, Pokémon averaged five trading card sales a minute during 2020. With more time on their hands and nostalgia for the past, many people decided to sell their collections.
Like most trends that boomed during the pandemic, some of this activity has declined. But Pokémon cards remain popular. Purchasing collectibles like Pokémon is not a bad investment. In fact, it’s quite the contrary. As long as a Pokémon investment is held with a long-term view, it is still viable. However, you must first consider your investment horizon, the liquidity of the investment, and how much you are willing to risk at one time. Furthermore, the allocation of your Pokémon card investments should be diversified, just like any other type of investment that you would consider.
History of Pokémon and Pokémon cards
Pokémon was created by Satoshi Tajiri and Ken Sugimori in the early 1990s. In February 1996, the first Pokémon video game was released under the name Pocket Monsters. Along with the game, the first trading cards were released in Japan in October of 1996. The cards were then introduced to the American market in 1999 by Wizards of the Coast. Wizards of the Coast is also the trading company behind Magic the Gathering.
Since then, more than 40 billion cards have been printed. The popularity and global recognition of the game have produced numerous cards, secret rare cards, and promo cards that have now become serious collectors’ items. These have led to Pokémon cards becoming an investment class all to themselves, with people spending hundreds of thousands of dollars for some of the rarest and most pristine cards or a nice promo card.
Collectible cards as an alternative investment
Alternative investments have become increasingly popular over the last 10-20 years. Alternative investments are investments that don’t fall into the four traditional categories. Although sometimes disputed, the four traditional areas of investments are stocks, bonds, cash, and real estate. Cryptocurrency is one example of an alternative investment that has taken the world by storm in the past few years.
Want to know which alternative investments, like crypto and Pokémon cards, are ready to boom? Here are some advisors that will know what you should consider.
Trading cards have become an increasingly popular form of alternative investment in the last few years, as they have two of the top qualities that define a viable alternative investment: popularity and scarcity.
Popularity is defined by how widespread and readily available these trading cards are. If something is popular globally, then there will be continuing demand for this type of asset. This is important when addressing the liquidity of an investment. The more popular something is, the more demand there is for it, thus giving many more options for buying and selling. The more paths for buying and selling the investment, the more liquid it is.
Scarcity relates to the rarity of certain cards and correlates directly to how much a card is worth. The more scarce the trading card is, the more it will be worth. If the company only printed 10 of a certain card one year and nothing else, these cards should continue to increase in value because of the scarcity.
How to start investing in Pokémon
Before you start investing in Pokémon cards, there are some important factors to consider.
Learn about Pokémon characters and cards
The best way to begin is to get an overall feel for the Pokémon trading card game and its collections and booster boxes. Try to understand which cards have held value, why they have increased in value, and the general timeline of Pokémon card releases. Top Cut Central and Bulbapedia are two websites dedicated to helping people learn about the intricacies of the Pokémon trading card game and which cards have performed historically well for investment.
It’s important to know the history of the Charizard and why it’s worth a lot of money before you start to chase cards. (The rarest cards are referred to as chase cards because people will open a pack to “chase” a certain hard-to-find card.) Once you have a full understanding of the difference between a booster box and trainer cards, you can begin to invest comfortably.
Understand the collectible investment time frame
The largest trading card market and index in the world is the PWCC Marketplace. When looking at the comparison of the PWCC Top 100 trading cards vs. the S&P 500 from 2008 to 2022, as shown in the graph below, you can see the top trading cards produce a huge return on investment. The top 100 includes other types of cards, such as baseball cards. But you can still get a sense of how collectible cards can be a good investment over time.
It’s difficult to define exact time frames of when a card’s value will increase the most. Therefore, it’s important to have a long-term time frame when looking at investing your money into collectible trading cards.
The best Pokémon cards to invest in
Now that you understand the Pokémon characters and the investment time frame, here are some of the Pokémon cards you might want to consider as an investment.
Quintessential blue-chip Charizard
Anyone who lived through the original Pokémon craze of the 1990s is probably familiar with the Charizard. Every child or adult searching through a booster pack in the ’90s was looking to get their hands on one. Wizards of the Coast purposely made this the most scarce card of the initial collection. Currently, original Charizards fetch between $300,000-$400,000 at auction on a regular basis. In fact, a Charizard-rated PSA Gem-Mint 10 (virtually perfect) can fetch $420,000 at auction. Although the price tag for this type of card is high, there is no more blue-chip, stable, in-demand Pokémon trading card than a Charizard.
Amazing Rares are a great deal
For those that don’t have “Charizard money,” the Amazing Rares collection of Pokémon is a good start. The Amazing Rare Pokémon were made available in both the Vivid Voltage and Shining Fates prints. They represent legendary and mythical Pokémon that were originally intended to be chase cards in the set. Due to the popularity of the Shining Fates collection, there was considerable overprinting of some of these Amazing Rares, which drove down the value (often less than $50). This means if you can get your hands on a good version, rated PSA 10, then it could be a very smart investment for the future.
Marnie Sword and Shield
The Marnie Sword and Shield card (you may see it labeled Marnie-SWSH) is a great investment for those that don’t have the cash for a Charizard but are looking for something a bit lower-to-mid-level in scarcity. Of the five different printings of Marnie in SWSH, three of them are unique full-art trainer cards (more rare, art-focused cards). These prints are scarce and thus should become even scarcer in the future. Some of them sell as high as $70 on the open market.
Pikachu with Ash
Pikachu is the most famous of all Pokémon characters. It’s no surprise then that a rare artwork card featuring Pikachu would satisfy the demands of a good collectible. This card has increased in value from $3 to over $40. It’s part of the Comic Eclipse set and is a full-art trainer card, which is both scarce and popular.
How to build a collection
It’s important when looking at investing in alternative assets like Pokémon trading cards to dip your toe in at first. There are many aspects to understand about how to trade Pokémon cards and which time to collect them. It’s probably a smart idea to go with some of the more inexpensive options that you feel will be more popular and/or scarce over time.
It’s also important to note that there is a risk of certain rarer cards being reprinted in future sets of Pokémon. Although your Pokémon card might be specific to the set, various prints of the same card in other sets can cause it to lose value. This is why it’s important to consider blue chips, such as the original Charizard, in which you know the scarcity is defined forever.
In January 2022, eBay began offering an authenticity guarantee for trading cards selling for $750 or more. The seller ships the card to a team of authenticators for a comprehensive inspection before sending it to the buyer. If you are considering purchasing an expensive card, you might want to look for a seller that offers this kind of authentication.
What Pokémon cards are worth buying in 2022?
There are several Pokémon cards worth buying in 2022. We recommend any of the Amazing Rares, for example.
What Pokémon cards will go up in value?
Really rare cards, such as an original Charizard, will most likely go up in value. Other rare trainer cards or art cards are also a good bet, but there are no guarantees.
Are Pokémon cards a good investment?
Pokémon cards can be a good investment if you know what you are doing and you have a longer investment time frame.
What are the most profitable Pokémon cards?
The most profitable Pokémon cards are the cards that you buy inexpensively when a booster box is released, and in time, they increase in value.
- Pokémon trading cards are a collectible that has become a viable and popular alternative investment over the years.
- Alternative investments are investments that are not traditionally cash, stock, bonds, or real estate.
- Alternative investments like trading cards are typically defined by both popularity and scarcity.
- Investing in Pokémon cards requires both education on the cards as well as a long-term view of the investment.
- A 1990s Charizard is an example of a valuable blue-chip Pokémon card, whereas affordable Amazing Rares are newer and more commonplace.
View Article Sources
- What Role Can Alternative Investments Play in Retirement Savings? – SuperMoney
- Beginner’s Guide to Investing – SuperMoney
- Types of Alternative Investments – Harvard Business School
- eBay Launches Authentication for Trading Cards – eBay
- Non-Sports Trading Card Values – PSA Authentication and Grading Services
- Pokemon in Figures – The Pokemon Company