Your Magic collection is worth less today than it was last month. It will be worth even less a month from now. That should not surprise you because it
happens every summer. July and August are when Magic cards are at their cheapest.
Fluctuations in the stock market might not correlate with the weather like Magic does, but many commodities do have yearly highs and lows. According to this article, motorcycles and suits are at their cheapest in
January, while July is the best time to buy furniture and tools.
The reasons for these seasonal shifts vary depending on the item and the industry. Motorcycles, for example, are at their cheapest in January because
demand is low due to unfavorable weather. Furniture is on sale in July because that’s the end of their season, and the new models tend to be released in
August. Magic’s yearly price nadir is in July and August for a few reasons:
The Weather
-Free time is a limited resource. In the winter, the only things competing with Magic are indoor games and a few expensive snow sports. During the summer,
Magic has to compete against hiking, biking, the beach, model rocketry, and a thousand other fair weather activities. In addition, many game stores are
stuffy and uncomfortable during the hottest months of the year.
The American School Year
– A large number of Magic players are still in schools that are on break for most of the summer. People go on vacation or off to camp, playgroups split up,
family dinners are scheduled on Friday nights, and there’s no chance to hold impromptu tournaments after class or during free periods.
Block Fatigue
– Do you remember how excited you were when you first saw the Gods of Theros? What about enchantment creatures, Thoughtseize, and the brand new Elspeth?
September is a magical time where every card has the potential to be outstanding and format warping. By July, the novelty has worn off. Less excitement
leads to fewer sales.
Reprint Fears
– The yearly core set usually brings about a handful of high profile reprints that cause the prices of several cards to drop. Even if you don’t own any
copies of Chord of Calling or Urborg, seeing a $40 card fall to $10 might make you pause before pulling out your checkbook to snag that last Linvala you
need. The reminder that any card can drop in price at any time can be very sobering to some.
Impending Rotation
– Standard has long been the engine that’s driven the Magic’s overall secondary market. By July, everyone knows that there are only a few months left
before rotation changes the format completely. As players look to move their cards before they crater in value, the overall market begins to tank. Things
generally don’t recover until the start of the fall set spoiler season.
Many in the finance community assumed that 2014 would be different. This was due to a change in the PTQ schedule placing Modern season in the middle of
summer. With Modern interest peaking in June and July, wouldn’t the world of Magic finance be flipped on its head? Shouldn’t staples like Scalding Tarn and
Snapcaster Mage reach their peak during the height of summer’s Modern season?
Not wanting to be left out, many players bought into Modern in a major way back in the winter and spring. This speculation frenzy coincided with the time
period where Magic demand has historically been at its highest, and the result was an increase in the price of most staples to the tune of about 30%. In
contrast, the current bear market has caused the Modern index to drop in price about 10%, meaning your eternal collection is still worth more than it was
at any point in 2013.
So what happened? We’re in the middle of Modern season right now, so why are the prices of staples continuing to fall?
One reason is that the concept of a Magic format season affecting prices is a little outdated. See, there used to be a format called Extended, and it acted
as the bridge between Standard and Legacy. Extended was an unpopular format though, and outside of a few small communities, people only played it when they
were required to. This created a seasonal boom-and-bust cycle where staples that were sold off at the end of one Extended season were bought up again at
the start of the next one. Very few players held their Extended cards year-round, and a large part of Magic finance five or six years ago was identifying
which staples would be important during the next year’s Extended season and buying them up before the pre-season frenzy.
Modern may have been created as an alternative to Extended, but it does not share the older format’s unpopularity. Modern has lots of grassroots support,
and there are many opportunities to play it year-round on the local level. The addition of Modern events on at Star City Opens will also help cement the
format as a year-round dynamo.
In addition, PTQs no longer drive Magic sales in the way that they used to. Many players – even competitive ones – avoid the Pro Tour grind altogether
these days. Grand Prix tournaments have gotten bigger and more accessible, the Star City circuit has gotten huge, and big, local, high dollar events have
become a permanent fixture on the Magic landscape. There are ways to play lots of high level Magic – and even win money while doing so – without worrying
about the Pro Tour at all. In addition, the ranks of the casual and ‘casual competitive’ players have swelled considerably. How many people do you know who
own and play with multiple Modern decks but who have never gone to a PTQ?
Because of this, the idea that Modern season would cause prices to rise was overblown from the start. Instead, the normal season cycle of Magic prices has
taken over which caused the prices to drop as we all should have expected.
Another part of the equation, especially when it came to Modern staples, was the ridiculous price jump that happened in February and March. If you had
asked me (or any Magic finance guy or gal) how high the prices for Modern staples could rise by June or July, then the prices this spring would have been
at or above our loftiest estimates. The increases that we expected this summer came a few months early thanks to a combination of eager speculation and
player demand. It should not have surprised anyone when Modern simply refused to grow any further this year.
This is a roundabout way for me to say that I am not worried about the overall health of Magic prices. This summer’s market downturn is likely nothing new,
and there is no need to panic and sell your collection. In fact, we’re a couple of weeks away from the best time of year to buy Magic singles. In the
second week of August, I will get to write my second article of the year pawing through Ravnica and Theros blocks for Modern and casual cards I want to buy
at retail and hold long-term.
For now though, it’s important to know what to do with the cards you already own. Here are a few bear market tips:
Trade With The Fearful
– I love trading in a bear market, especially one so close to a set rotation. Most of the time, players are smartphone sticklers at the trade table and are
never willing to budge from the number on the screen. That attitude changes for many during a bear market.
Take Sphinx’s Revelation. After spending the better part of two years between $20 and $40, the card has plummeted to $10 retail. Because the card has
cratered so hard, everyone knows that asking $10 in trade for Sphinx’s Revelation right now is a non-starter, because it’s going to keep dropping. Who
knows where the bottom is?
That’s where you come in. Star City is still paying $4 for Revelations, so you know that you’ve got a short-term out for them at that price. Furthermore,
the card sees a good deal of play in Modern, Cube, and Commander, and it’s a mythic rare that isn’t likely to be re-printed soon. If you can trade for them
at $5-$6 each right now – not out of the realm of possibility considering how far it has tanked – there’s very little short-term risk and a ton of possible
long-term reward. Asking someone to trade you a $10 card for $6 is usually a good way to get accused of being a greedy shark, but right now many grinders
are grateful to unload these tanking staples at any price.
Don’t forget that people gravitate toward perceived safer investments in times of uncertainty which is why the gold index soared during the recession. When
Magic prices are dropping, the perceived value of risk-free eternal cards is significantly higher. If you’re willing to give up something expensive and
stable, like a dual land or a high end Modern staple, you’ll be surprised at the kind of value people will throw at you in rotating cards.
Buy Collections
– Buying collections is a fantastic way to make money year-round. If you’re willing to put in the effort piecing out the individual cards, you’ll generally
be able to make a nice little wage while still keeping many of the best pieces for yourself.
In the spring, buying collections is much riskier. Remember when Scalding Tarn was a $100 card? You would have had to pay at least $60 each for them in a
collection buy, and you would have had to flip them very quickly in order to make your money back. If you had kept them through the summer, you’d find that
your profit margin had disappeared entirely.
During the summer, when card prices are at their lowest, buying collections is even better. If you’re willing to hold most of the cards until February or
March, you’ll increase your margins simply by tying up your cash for a couple of months. As long as this doesn’t choke your speculation fund too much, it’s
a great way to make a little extra profit. Your overall risk level is lower too, if you believe as I do that the market is due for a rebound.
Consider All Costs Before Selling
– Shocklands are dropping. Deathrite Shaman is down to $10. I expect both cards will continue to fall before they go up again. So why not sell now and buy
back in later? Well, as I briefly mentioned at the end of last week’s article, it’s important to consider the monetary
cost of selling, the time cost of selling, and the monetary cost of buying back in.
Even if Temple Garden has a retail value of $12, you will not be able to sell your Temple Garden for $12 unless your name is Steve Starcitygames. A more
accurate number right now is probably $8, plus an additional $1.50 or so in shipping and fees. So really, you’d be selling your Temple Gardens for about
$6.50 each.
If Temple Garden drops to $6, you’ll be able to buy back in at a profit, but there’s no guarantee that the card will drop that far (I expect it will not)
and that you’ll be quick enough to pull the trigger before the price goes back up if it does. Even in that scenario, it will have cost you all the time you
spent listing and shipping for the chance to make $0.50. Is that really worth it to you?
Feel free to sell your shocklands and other rotating staples now if you need the money, and you don’t think you’re ever going to need them again because I
do expect them all to drop over the short-term. If you’re looking to re-acquire them in the future or you’ve got the patience to wait for the post-rotation
Modern boom, however, I’d recommend holding them for the foreseeable future.
The only think I’m looking to sell right now are high profile lands that may be re-printed in the fall expansion. If either set of fetchlands or
filterlands are in the set, it will probably be announced at the SDCC panel on Saturday the 26th. That gives you about a week to sell your
extras before the market floods and the prices tank. The Zendikar fetchlands feel safe – Aaron Forsythe basically said as much, and enemy lands showing up
in M15 basically confirmed it – but I am going to sell some of my extra Onslaught fetches just in case. They should be easy enough to re-acquire if their
rumored reprint does not come to pass. I may also move some of my filterlands for the same reason. If the allied painlands show up this fall instead, well,
that’s when it’s time to go all-in on the Theros block scrylands.
It can be scary when your Magic collection loses value. We tell ourselves that we’re only in it for the gameplay, but I know many people whose Magic
collections are worth more than everything else they own combined. Just don’t forget that every commodity ebbs and flows, and Magic has never been an
exception. Don’t worry – we’ll be back to complaining about how high these stupid Modern prices can actually get before you know it.
This Week’s Trends
– Wizards of the Coast is releasing a new set if SDCC-exclusive Planeswalkers this year. The 2013 set is closing on eBay between $650-$700, and the 2014
set is pre-selling (along with a foam Garruk’s axe!) for close to $500. Mark Rosewater has said that they have printed more this year and are limiting sets
to one per person, so hopefully more of you will be able to get them at retail. In terms of speculation though, I’m staying away. The SDCC sets were a
great buy at $250 last summer before everyone realized how rare they were, but the margin went away quickly when they soared above $500 by the end of the
con. There will be more of them this year, and the cat is already out of the bag on how limited these runs will be. If you want a set for yourself, I’d
look to buy in a couple of weeks when the internet is filled with copies but the hype has died down a bit.
– It’s sad to me that the two ways of playing Magic digitally – MTGO and Duels of the Planeswalkers – are both worse than they were at this point last
year. While there hasn’t been a great MTGO sell-off yet, I do expect prices to drop and lag for weeks as people adjust to the v4 client. Before long, the
worst MTGO bugs will be fixed, and we’ll all learn to live with the new client. Duels of the Planeswalkers is a slightly bigger issue, and I hoped that the
stripped-down, M15 version filled with microtransactions doesn’t hurt the overall growth of the game.
– Speaking of Magic Online, Vintage Masters events will continue all summer long. I’m still waiting to buy my online power, and I think the price nadir is
still a couple of weeks off.
– I still have a feeling that Scuttling Doom Engine is going to be played in Standard. Call it an educated hunch. Saito posted a sweet decklist that uses
it in a mono-green shell, but I think the applications for it can go even further.
– Other Standard cards I’m targeting in trade: Thoughtseize, Hero’s Downfall, and Courser of Kruphix. All three will see tons of play in the fall, and
Courser has fallen off a bit thanks to the precon, making it a nice buy.
– Nissa, Worldwaker is the big winner in M15 so far. I am not surprised – if you read my review, you’d know that she was my favorite planeswalker in the
set. She’s overvalued at this point though, and I’d be looking to sell, not buy.
– Jace, the Living Guildpact is tanking so hard that its price might just be an impact mark in the Arizona desert before long. It wouldn’t shock me if Jace
ends up at $5-$6 before the fall set is released, and it could be a strong buy at that price. It’s not a great card, but it is close to being undervalued
at the moment. Keep it on your radar.