Sports Memorabilia as an Alternative Investment

A press release from last fall, but perhaps still relevant:

“At a time of sinking home and stock prices, investors are eager to find financial safe havens. While sports memorabilia may not be as sound an investment as bonds or a bank deposit, the returns can sometimes be breathtaking.

New York, NY (PRWEB) September 14, 2008 — Collectors have been trading sports memorabilia since the early 1900s when Babe Ruth trading cards were swapped and sold. Today, sports memorabilia is a multi-million dollar global industry. Collectors have made big profits by trading items autographed by the world’s greatest sports stars.

The highest price paid for a piece of sporting memorabilia is $2.8 million for a Honus Wagner baseball card. Wagner was a baseball star in the early 20th century and the card dates to between 1909 and 1911. Hockey superstar Wayne Gretzky bought the Wagner card in 1991 for $451,000 and later sold it to Walmart for $500,000. In 1995 Walmart made the card its top prize in a raffle, won by a Florida postal worker. A year later the card was sold at auction for $640,000. In 2000 it was sold again, this time on ebay for $1.27 million. Then, in February 2007 the card changed hands for $2.35 million, only to be sold 6 months later to a collector in California for a whopping $2.8 million.

The Honus Wagner card showed an annual rate of return of 12% between 1991 and 2007. Not bad when compared with the Dow Jones Industrial which returned 7.5% per annum over the same period. But a word of warning before you go buying up all the Honus Wagner cards you can lay your hands on. It has to be the right Honus Wagner card. A collector in Kansas recently sold a card on ebay for only $3.25.

Memorabilia from other sports can also be big business. A football (soccer) shirt worn by Pele fetched a record 157,750 pounds ($276,062), a lot of 6,000 pro football signatures sold for $22,417 and a Michael Jordan game jersey was valued at over $6,000.

There is also money to be made at the smaller end of the market. At time of writing there were over 690,000 sports memorabilia items listed on ebay with prices from $52,000 to one penny.

As with all investments the trick is in spotting good value. Prices for sports memorabilia can be fickle with demand rising and falling with a sports-persons career.

If you are buying sports memorabilia be sure to differentiate between official memorabilia and the rest. Official memorabilia will come with a Certificate of Authenticity (COA). There are many sources of COA’s so be sure you are buying from a reputable source.”