Anyone who’s ever shelled out some 800 credits for LEGO’s Star Wars Ultimate Collector’s Millennium Falcon knows that the building bricks are worth more than their plastic weight, but who knew they were worth more than gold?
According to a recent study by Victoria Dobrynskaya — an assistant professor at Russia’s Higher School of Economics who looked at her son's LEGO collection and thought maybe she had an investment already — from 1987-2015, LEGO sets bested not just gold returns on investment, but also large stocks and bonds ... to the tune of 11 percent a year.
In a paper titled “Lego -- The Toy of Smart Investors,” Dobrynskaya and student Julia Kishilova looked at the initial offering price of some 2,300 sets offered by LEGO in that timeframe, and then compared the price return with sales on secondary markets like eBay.
And apparently, though the Falcon was recently offered as LEGO’s highest-priced set, big-ticket items aren’t necessarily the best way to invest in the toy sets. In a trend similar to the Fama-French three-factor model, which very basically posits that investing in smaller companies yields bigger returns, smaller LEGO kits showed more growth than larger ones.
“The beta of the size factor is statistically significant and the dynamics of the LEGO index we created for our research is similar to that of the size factor,” Dobrynskaya told Bloomberg. “LEGO sets don’t show a significant correlation to the financial crises and can be seen as an attractive investment with a diversification potential.”
In one case, they even found a whopping 613 percent ROI, on a kit for Star Wars Darth Revan that retailed for $3.99 in 2014 and then sold for $28.46 on eBay the following year. That’s not playing around.
Now, before you start buying even more LEGO sets, keep in mind, there’s as much certainty in this study as there is in the rest of the investment market. So buyer beware; but at least if you can’t sell a LEGO set, you can still play with it.