Collectors Vs Investors
Published by on November 27th, 2007 in Memorabilia

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When a kid gets an autograph from an athlete, there is often a consciousness about how much that autograph is worth, or what it may become worth in the years to come. But there is a big difference between a fan, or what we will refer to for purposes of this conversation as a “collector” and the memorabilia “investor.”
 
The collector is largely interested in the aesthetic value of an item, which may be the content of an event program, the autograph on the picture that is signed, the logo of an organization, the names that appear on a poster, or whoever used what piece of equipment in what match. Sometimes it comes down to what “looks cool,” because more often than not it is going to become a display for a home or office. In other words, these are keepsakes.
 
The collector often attaches a certain amount of sentimental value to an item, which means that there are some things he will not sell no matter what. Don’t get us wrong; there are things the collector will sell, but it might be for the purposes of acquiring something else. there is not necessarily a big profit motive.
 
The investor is a little different. He wants to do just what the name implies – invest. That means everything, or nearly everything, is bought with the specific objective of selling it one day for a profit. Those profits can be used to purchase other items that are in turn re-sold, in the pursuit of wealth building. It is a BUSINESS.
 
Of course, there are various kinds of investments in memorabilia. It is not so dissimilar to the way people look at the stock market. Some investors will buy an item with the specific idea of holding it for the long term, with the expectation that it will appreciate a great deal in value for one reason or another. Some will also buy items in bulk, with an eye toward having a great quantity of something that is going to worth a lot more in, say, five years than it is now.
 
There is also a “wheeling and dealing” aspect to it as well. Investors may buy items from collectors or fans or others with the idea of getting a bargain, then turning around and “flipping” it for a profit rather quickly. Since the investor, as a tool of the trade, would develop contacts or “outs” where items can be sold, there is also an expectation here, much like someone who is flipping houses might look at it. In other words, they know they can sell it somewhere before they buy it.
 
With some of this there is a lot of speculation. If we can use baseball for example, it is not uncommon to load up on the rookie card of a player who is projected to be a big star, in the hope that the card will become extremely valuable if, say, the player becomes an All-Star or Hall of Famer. That’s a long-term proposition, and it can be very hit-and-miss.
 
Investors often sell to collectors, because it presents an opportunity to unload an item that was bought at “wholesale” or lower for a retail price. that is a fact of life. The bottom line is that, by and large, the collector is engaged in a hobby, while the investor is involved (and immersed) in a business.