I was listening to a podcast interview with the author Morgan Housel, who's book The Psychology of Money has sold millions of copies worldwide. (I promise this relates to collectibles markets; stay with me...)
Unlike most finance books, Housel doesn't focus on investing tactics, tips or tricks.
Instead, he focuses on how our innate human psychology fails us when it comes to effective investing decisions. In this podcast interview, Housel reiterated one of the simplest, yet most important points from his book:
Sticking with your investments over the long-term is key.
His example: Warren Buffett, who just retired from investing at the age of 95 after building his net worth to an estimated $150 billion.
As if his enormous wealth wasn't shocking enough, Housel also revealed that 96% of Buffett's wealth was earned after his 65th birthday.
There's no question Warren Buffett was a great investor, but his outsized success came not just from great decisions, but from doing it longer. Buffett could have retired at 65 with more money than you can imagine.
Instead, he continued investing for another 30 years, and compounded his wealth many times over.
Buffett proves the value of a patient, long-term investing perspective.
The same is true for collectibles.
When I think of the great Pokémon collectors, names like smpratte and TCA Gaming come to mind. These are not hype-fuelled investor bros: they each have 20+ years of experience in the Pokémon market. Remarkable, considering Pokémon is only celebrating it's 30th anniversary this year!
Their time in the market gave them the ability to buy cards cheaply, before anyone cared about Pokémon cards. And through their patience and long-term commitment, they've seen the values of those cards reach the huge numbers we see today: from tens, to hundreds, to millions of dollars.
Sticking with your collection over the long-term is key.
Of course, this is easier said than done. In his books and talks, Morgan Housel provides a number of reasons for why our psychology gets in the way of a long-term investing mindset. My favorite explanation of his is simple:
The long run is just a bunch of stressful short runs.
Collectors like smpratte and TCA Gaming have mastered this: their extensive time in the market means they have more experience than anyone navigating the ups and downs in the market.
And they've earned the benefits of sticking it out.
But most collectors won't hold on that long. Instead, they'll give up on their collection long before the hobby would have rewarded them.
This is a shame, but it's not surprising.
Every boom phase of the collectibles cycle brings incredible attention, and hype, to the hobby. And the hype draws in many new collectors: it grows the market.
But hype is a bad teacher, driving collectors to pursue short-term opportunistic moves and burning them out before they have the chance to discover the joy they could get from the hobby.
And, here's the thing: a long-term perspective doesn't just help the individual collector. It also creates the best possible outcome for the Pokémon market, or any collectibles market.
The market grows by building more long-term collectors.
This is why I've dedicated so much time and energy to understanding what long-term, established collectors already know through their decades of experience. I want to help share what they've learned with as many collectors as possible to, hopefully, do my small part in helping grow the collecting community.
As usual,
Thanks so much for reading the TCG Buyers Club newsletter. My name's Grey, I buy cardboard, and I'm on a mission to make collecting and investing in Pokémon simple.
Cheers 🍻
P.S. If this resonates with you, let me know! I’d love to hear your ideas for growing the hobby over the long-term.