Get Rich Investing In LEGO
Original Article: https://www.wired.com/2012/12/get-rich-investing-in-lego/
Here at GeekDad, we're huge fans of Lego for its play value, but it turns out that a growing number of people out there are interested in Lego for its financial value. And no, I'm not talking about the old-school approach to investing by buying stock in the company -- these people are buying up select Lego sets, holding on to them for a few years, then re-selling them for a substantial profit.
HERE AT GEEKDAD, we're huge fans of Lego for its play value, but it turns out that a growing number of people out there are interested in Lego for its financial value. And no, I'm not talking about the old-school approach to investing by buying stock in the company – these people are buying up select Lego sets, holding on to them for a few years, then re-selling them for a substantial profit.
Over at USA Today, there is a full story on some of the people investing in Lego kits. For instance, they profile David Schooley, a father of six who has more than 3,000 mint-in-box sets stockpiled in a climate-controlled storage facility. Schooley's investment returns him 10% to 15% annually, which easily beats most stock investors. An even more impressive return scenario is described in the article:
Let's say two investors had $10,000 to invest at the end of 2011. One investor bought 174 shares of the Vanguard S&P 500 index exchange traded fund for $57.45 apiece, while the other bought 100 boxes of the Emerald Night Lego train set for $99.99 apiece. The Emerald Night is a 1,085-piece Lego set that, when built, looks like a classic steam engine with a tender and a passenger car. Fast forward to today. The stock investors would have done pretty well, with a 15% gain, including dividends paid. But the Lego investor would be able to sell the Lego Emerald Night trains for $203 each, for a total 103% profit. In other words, the Lego train would have outperformed the stock market by 587%."
There are many factors driving the surge in interest in Lego, including tie-ins with movies like Star Wars and Lord of the Rings, and the legion of Adult Fans of Lego with the disposable income to spend on collectibles.
Unsurprisingly, the interest in Lego investing has spawned a website dedicated to it. Brickpicker's mission statement is:
The mission of BrickPicker.com is to educate the Lego enthusiast and collector of the most up to date and current prices of new and used Lego sets. Through our partnership with eBay, we have access to thousands of current and past auction results from the thousands of various Lego sets sold on eBay. By utilizing this information and putting it into easy to understand charts and graphs, the BrickPicker member can make intelligent and cost effective choices when making their next Lego purchase. In addition, BrickPicker members are able to view pricing trends in the Lego world. Various tools and data are at the BrickPicker member's fingertips, not unlike many 'stock' websites. This will enable the Lego collector to put a value on their own collection and to gauge future purchases. While our site has information about the multitude of Lego sets in existence, our focus is about the 'value' of these sets. We hope you enjoy our site and use it to make intelligent and cost effective Lego purchases in the future."
Of course, like any investment, there are risks, including fire, theft, fickle future buyers, and the chance that Lego will reintroduce a kit and clobber the resale value.
Head over to USA Today for the full article...