woensdag 12 oktober 2016

Is Lego worth more than gold? The Test: introduction

The christmas period is approaching, so expect the traditional reports in newspapers and on websites of once again "LEGO is worth more than gold", "LEGO is the best investment" etc etc etc...

Now, I often roll my eyes about these sorts of articles, as people tend to think that EVERY piece of Lego falls under those lines, while it often goes about the big sets like UCS Falcon or the Taj Mahal that they talk about.

Not those boxes of Friends, Ninjago, City and other common lines.  They have by far to much production, and non-franchise rare figures, to even get close to the "double your money in 2 years time" mark.

Or have they?  Has my idea about this been wrong?  Is it true that every little piece is actually a fortune in the waiting?  Perhaps there is only one way to find out, namely to do research and do the test.

After reading a lot of books, sites, forums, topics etc on the matter and watching a lot of YouTube videos on it (BrickBarian being my favorite), I did come to one conclusion already.  Instead of running it from january 1st until december 31st as I initially planned to, it's better to run it from today until the last day of october 2017.  That way, you "cover" two periods known as the christmas rush, as end of year holidays (in the States, there is also Thanksgiving) kick in and I can pick those up.

Now, I have been preparing a "portfolio" over the past 6 months to accomodate this test, and put together a nice 1000 USD worth of investment bricks for doing the actual test.  I divided this over a whole lot of different areas, in order to be able to test it in various areas and through various channels.

The split:

200 USD in used parts
300 USD in used sets
500 USD in old and new sealed sets, divided as followed
 * 100 USD of current small sets
 * 150 USD in older, retired, sets
 * 250 USD in Exclusives



Now, I`m going to try and flip those over the coming 12.5 months through various ways. The goal at the end of the year is to get my investment back, with the surplus set aside for purchasing sets I actually want (or better said, bricks for my MOC`s and such), while doing some further investing throughout the year IF great opportunities arise.  Think garage sale hauls, or reductions of at least 40%, though I`m aiming more at 50 to be honest at the minimum, or it are some nice, old, retired sets.

The Numbers

Start: 1000 USD
Portfolio Value: 1839.99 USD
Goal: 2000 USD
The Wet Dream: 3500 USD
Current: - 1000 USD

Now, a bit of explaining perhaps with those numbers.
Start is what it says, the initial amount I invested for doing this test, by purchasing sets and all the past 6 months, loose elements through BL sales, figures through FB groups etc etc.  I want this back for sure.
Portfolio Value is what my amount of SEALED sets is currently worth according to BrickPicker.  Looking at those numbers, it might look like a sure shot to succeed in this test, but value isn`t the same as actually moving them, all the same I flip absolutely nothing and loose out big time on this endeavour.
Goal is the amount I would love to reach by the end of october 2017.  That would mean that you can indeed easily "double your money" with investing in Lego.  It would mean the test is a success, the articles are all true, and I should shut up in the future.  Well no, it could also mean an exclusive went through the roof, that I had to do a ginormous amount of work on them, or should consider a career in sales...
The Wet Dream is just what it says, a totally unrealistic "target" that would allow me to pat myself on the back and say "damn boy, you`re the man, you trippled that stuff".
Current is well, how much the score is right at that moment... so obviously as this is the introduction, a total loss over the whole line.



So that is the lines set and the ideas fleshed out, will I succeed?  I honestly have no clue.  There is a lot of external factors to consider.  The market is saturated at the moment, more and more people are hoarding their sets for resale, and the time of "finding a good deal" are long passed by as some prizes on secondary markets are absolutely out of hand.  But in a dog eat dog world, I feel myself as a fish in the water...


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