Mar 12, 2021 - Sports

The sports trading card phenomenon thrives during the pandemic

10 most expensive sports trading cards

The trading card boom that exploded in the early days of the pandemic has recently reached a fever pitch.

Why it matters: Seven of the 10 most expensive sports cards in history were sold in the past eight months — and the all-time record has been broken twice since August.

The backdrop: The hard lockdown at the pandemic's onset resulted in a lot of spring cleaning, with people unearthing treasures from their past and hopping on eBay to see what they might be worth.

  • The trend took off from there, and trading cards soon became the most popular alternative asset class thanks to their liquidity, simplicity and a healthy dose of nostalgia.

The state of play: Two of the most important factors helping drive this boom are rarity and third-party verification.

  • Rarity: The "junk wax" era of the '80s and '90s showed the danger of over-saturation. Today, the most valuable cards are also the rarest, due either to being vintage or modern (companies now produce micro-batches of special edition cards they know will be highly coveted).
  • Grading: In the past, buyers had to take sellers' word on the legitimacy of their cards' condition; now, companies like PSA and Beckett act as neutral arbiters of quality.

The big picture: Amid this surge of enthusiasm, the surrounding industry has elevated itself to meet the moment.

  • Goldin Auctions, one of the leaders in this space, raised $40 million last month from the Chernin Group. Goldin has grown from grossing $800,000 in 2012 to over $100 million last year.
  • Fractionalization has also taken off, with companies like Rally (2016) and Collectable (2020) allowing investors to buy shares of million-dollar memorabilia for as little as $10.

Of note: The risk, of course, is that most booms tend to go bust sooner or later. That said, collectibles could be a safer bet than, say, meme stonks.

"Traders can short sell when a commodity price gets ahead of itself, like with GameStop. ... In asset markets like sports cards ... it's impossible to short sell. Someone cannot come in and discipline the market."
John List, economics professor and card collector, via The Athletic

Go deeper: Read the full Axios Sports special report on the rise of sports fandom investing

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