In my last post, I shared some perspectives about why I think people like pokemon. Namely it comes down to art, nostalgia, and speculative investment value (driven by deflationary economics of sealed and graded products). This post is another primer. When people say they are “investing in Pokemon,” they are usually doing one of four things: holding sealed products, buying raw singles, buying graded slabs, or ripping packs. These are completely different behaviors with different risk, liquidity, storage needs, and fun-to-finance ratios.
Sealed
Sealed products are any in-package cards. From the pokemon center, this includes elite trainer boxes (with special pokemon center promos if direct from pokemoncenter.com), booster boxes, and booster bundles. Various sets also have boxes that come with other assorted products like pins, binders, or other promos. These packages are highly sought after for two reasons:
- If you are investing: they are deflationary. Every sealed product that gets opened, like ripping a box for fun, a streamer opens packs for content, a kid gets an ETB for Christmas, that product is gone forever. So, as Pokemon keeps releasing new sets, and older sets eventually go out of print, the market slowly shifts from “available at retail” to “only available from stockpiles.” This naturally increases prices as supply inevitably tightens over time.
- If you are ripping the product: they are highly trustworthy. In many cases, you cannot or should not buy loose booster packs because many sets are weighable. i.e. heavier packs often indicate that a special or rare card is inside it, so anybody who weighs their products will likely rip it themselves, rather than sell it to you, a safe assumption is that loose packs are already weighed, so you have a smaller chance to pull a rare card. You should also be wary of those being sold as heavy, as there is still a small chance that they do not include the cards you’re looking for. Anyway, sealed products can largely remove this issue due to the variance in weight of the packaging. You know that you are getting a fair shot if you rip the pack. Buy from trustworthy sources!
Over the long-term, you can look at almost any Pokemon Center elite trainer box or booster box from the last 30 years to see there are little-to-no instances of the fair market price of a sealed product that is lower than the MSRP at release. From an investing and collectability standpoint, sealed products only get rarer and more valuable. For collectability, some sealed products are also great for displayability. Stacking certain boxes of product together signals a lot about you as collector, from aesthetic taste to a particular era of pokemon.
The largest tradeoff to collecting sealed products is frankly the physical space. Boxes can take up a bunch of room in your closet / shelf / under the bed. Your partner might think you’re insane for hoarding so much shiny cardboard. There are real costs to collecting these!
Rips
If Sealed is the best way to invest, rips are the best way to light money on fire. Obviously, this product was not made purely for investment purposes and to hide away boxes and boxes of cards never to be seen or used. Ripping a pack and getting a card you’ve been chasing to add to your own collection is a phenomenal feeling, made better with friends. Personally I love ripping packs. It is unfortunately a bit akin to gambling when the pull rate of a Special Illustration Rare is 1/2000 in the latest set Ascended Heroes. It sounds insane, but the fact that it happens drives the zeitgeist.
I would characterize this as the fastest way to lose money in the hobby but absolutely the most fun part of it. I would recommend trying to set expectations on ripping. It is EV-negative but very fun. Budget or behave accordingly.
Raw
After buying some sealed product and ripping it, you end up with “raw” cards (sometimes “singles”). These are just the unprotected, ungraded copy of the card that came in the pack. This is allegedly the most liquid, fast-selling, in-demand item at most card shows. Most people are not paying $500-$5000 for highly collectible and sought after graded cards. The average person is probably just trying to fill a binder of cards they like for whatever reason. These can range from $1 to $1,000 or more, depending on the rarity and condition.
Most people collect raw cards to put in binders. These are displayed or viewed as “personal collections”, where again, many people collect for the art or nostalgia aspect. Personally, I’m super into it. Check out these sweet sweet binder pages of my teams from Pokemon Fire Red and Z to A that I wanted to immortalize in binder pages, along with a matching art aesthetic! I also have pages I want to create (with some cards I’m missing that I want to collect later) that includes pages like Kanto/Johto starters, legendaries, and more.
Graded
If your raw card is in extremely good condition, you could consider grading it, which is what many investors/collectors do. Grading is the process of mailing or submitting your card to a grading company like Professional Sports Authenticator (“PSA”) or Beckett Grading Services (“BGS”) or other services like Certified Guaranty Company (“CGC”) or TAG (AI grading). Each company has their own reputation, upsides and downsides. I would recommend looking into which are popular for what you find important. However, I will say that, in Pokemon, the predominant currency is PSA graded cards (“slabs”).
Good condition means the centering is good on the card on the left/right and top/bottom on both the front and the back. PSA has an explicit guide online that you can reference to learn more, and Youtube has a plethora of examples of influencers talking about grading quality if you’d like to learn more. AI grading is coming a long way but isn’t perfect yet, so grade at your own risk. These days, many people are upset with grading companies due to dramatically increased demand increasing wait times for graded cards to return, and upcharges for insurance when returning a higher value card back to you.
The nature of grading cards adds to the deflationary nature of pokemon. First, each set has a print run that is physically limited by factory capacity, then it will be limited by time as the Pokemon Company prints multiple sets per year, so needs to rotate sets out of print when they release more and more subsequent sets. Not all this supply will be purchased, and of the supply purchased not all will be opened (see: sealed section). Not all that are opened will have high quality condition cards to be graded a 10/10, and then not all of the 10s will be available as purchasable supply on the market as more collectors buy and hold. Thus, graded cards also become scarce and pricing dynamics can be highly sensitive to demand, especially for highly popular pokemon like Charizard, Gengar, Pikachu, Mewtwo, etc.
