LEGO as Investment

weinner

I went to see my broker today and took money out to invest in lego. He asked me what my plans are with the money and I did tell him. He laughed, I laughed back, and told him to do some research. I told him I will double or triple my best stock, which is Apple, currently at 61%. He said I'm crazy. We'll see who's crazy.

LegoFanTexas

@LegoFanTexas So tell your mom she would be better off now selling them and purchasing Lego. Gotta turn that over at some point and get better present return ;)

Then again, if she takes a tax hit . . .

She is keeping them for her children, I already know I'll put my favorite over my fireplace when I end up with it when she passes. I could sell it, but I doubt it, I quite love the one she bought for me, I could pass it down to my kids when that time comes.

The question becomes, in 50 years, will it be worth more or less than it is today, after inflation?

Who knows, but I think that painting has a better chance of being worth more than Lego does, to be honest with you. :)

BrickDancer

^^Which ones are you going to invest in most right now @Weinner?

allmybricks

Less. Anyone is lucky to ever sell a TK in the aftermarket... Complicated editioning, with most editions never touched by TK himself. It's commercial art where the value is completely inflated by the network of galleries.

A sealed Cafe Corner is already worth more than most TK paintings in the aftermarket. I'd be willing to bet there are more active buyers for the CC than TK too... eBay isn't the place to sell art, but you can see how many TK auctions end without any interest at all. Look at the top 100 highest priced TK listings on eBay and how many are selling...

LegoFanTexas

You're right about the mass marketing of TK artwork, so much as been produced that most of it will have little value for awhile...

The paintings that my Mother has (three of them) are Studio Proofs, meaning that TK himself actually painted on them and signed them himself.

Those are the only editions I think will have any real value in 50 years, too many of the other editions are being made.

I've toyed with buying a Master Edition print, they only ever make a single one of those in the world in each size. That makes it unique, and possibly the one to "invest" in, if one were going to do so.

allmybricks

Toy with LEGO, not with art. :-). You'll never find an art consultant that will recommend buying anything by TK. He's not an investment grade artist. If you do find one that does, run... You're likely in a TK gallery. :-)

Say a TK master edition (which is still just a lithograph that he's painted over, not the original painting) costs $5, in a questionable market (meaning its not growing for whatever reason) You'd be better off working with a consultant to find (5) up and coming artists with aftermarket potential and buying 5 pieces at $1.

It's like the UCS MF at $2500. Will that go to $5000? Possibly. Would it be faster or easier to ride 5 x Green Grocer from $500 to $1000? Or 10 x Tower Bridge? Or 200 x Nuckals ATV?

But you've already got all those bases covered. :-) and by coveting all the bases they don't all need to be winners...

rocao

I told him I will double or triple my best stock, which is Apple, currently at 61%. He said I'm crazy. We'll see who's crazy.

The flip side is that a LEGO set will never do this (from my portfolio):
AAPL: Price Paid: $13.27 Total Gain %: 4,490.83%

LegoFanTexas

Toy with LEGO, not with art. :-). You'll never find an art consultant that will recommend buying anything by TK. He's not an investment grade artist. If you do find one that does, run... You're likely in a TK gallery. :-)

Say a TK master edition (which is still just a lithograph that he's painted over, not the original painting) costs $5, in a questionable market (meaning its not growing for whatever reason) You'd be better off working with a consultant to find (5) up and coming artists with aftermarket potential and buying 5 pieces at $1.

All very good points...

Nothing wrong with any of it, all I'll say is that all 5 of those "up and coming artists" could easily be worthless... Unless TK really screws up his brand, someone will want the higher end items that he painted.

Or they won't. :)

Time will tell...

One fair point is that anything sold as "collectible" usually isn't... but then again as I said, she owns three of them, they are beautiful works of art (I think so anyway), and one of them will belong to me when my mom passes, and I really don't want to sell it anyway. :)

CCC

^ The other thing about art is that you can enjoy it and still retain its value. You can hang it on your wall and get 10/20/50 years of pleasure from it. If you open your Lego to enjoy it, you've lost value since it is no longer MISB. All you can do is sit and look at the box and think about what is inside.

Dougout

I went to see my broker today and took money out to invest in lego. He asked me what my plans are with the money and I did tell him. He laughed, I laughed back, and told him to do some research. I told him I will double or triple my best stock, which is Apple, currently at 61%. He said I'm crazy. We'll see who's crazy.

That's funny. My father is a financial adviser and he also had no idea that lego was collectible. He said he's not very keen on investing in collectibles because they are part faddish. I think most big investors would care less about lego because they've only dealt with stocks their whole life and the idea that a toy can make money is foreign to them. Not to mention, these investments can take up a lot of space which regular stocks do not. That said, my father did tell me there was one guy in his firm that does collect lego and has a big storage bin full, whatever that means.

@rocao, Wow!!! You must have bought very early in the company's history. 60k will buy a lot of lego, assuming you didn't sell any shares yet. I know someone that got in very early on apple, but he sold his shares almost two decades ago for a fancy sports car. Disappointing, considering he could've bought a mansion if he waited long enough.

Dougout

@CCC I see your point, but the value doesn't go down much. The MF is almost as valuable used as it is NIB. Yes, you may lose a tiny bit of value if you open a MISB set, but that is when the real fun begins. I consider lego art. Especially from seeing all the sculptures people have built themselves and the ones in legoland. Many people, along with myself, consider the boxes art as well. We can enjoy the art while we play with it, while we admire our creations or even while its still MISB.

cheshirecat

Presumably most standard investors don't want to spend the time looking for bargains, selecting the good deals, storing the sealed boxes and then selling through ebay or other platform. Although the ROI can clearly be very impressive there is a not-insignificant amount of effort involved and it is very hands on. Whilst some will love that the majority will just not be interested.

Its entirely possible to invest in art or wine and never see or touch a bottle or painting - the same with stocks, its not like you have to let an employee or two stay at your home (which is the equivalent). As far as I'm aware this kind of managed investment is not yet possible with lego.

^^^^ Apple shares can also fall and hell have they got a long way to fall - eventually people will realise that there's nothing that special behind the brand. Their product releases over the past 12 months have been entirely disappointing from a technical pov, although a large number of stupid people still happily hand over more money for the same product that will eventually end. The brand is now almost entirely based on image and that is inevitably extremely fragile.

roxio

I bought over 50 of one set and resell at over 2000% profit, problem is the actual £££ is low

weinner

^^^^ I know, I hate apple products, but people are lemmings and keep on buying the stuff. I told my broker one more ipad and iphone, then I'm out. So far an ipad has came out so we'll see.

gmpirate

^ Completely disagree. I had both pc's and macs at work and home for years. Now I just use Parrallels. Love the Apple ecosystem. I know it's part if their mantra, but everything "just works". There are constant incompatibilities with pc's. I use Siri all the time. Waiting for the new Apple television for my office :) Yes, I'm a zealot, but I've built pc's for years for both personal and professional reasons so at least I am without being blind ;)

LegoFanTexas

Ditto the Apple thing...

Typing this on my iPad... :)

It "just works" which is why they sell so many.

My current cell is a Droid 3, this is the last one I'll own, this fall when the iPhone 5 comes out, I'm switching. Too many little headaches and problems with the Droid for my taste, and it runs slower and slower as time passes.

weinner

YAY! more money:)

gmpirate

Lol

weinner

I've been thinking about switching to the iphone as well, just because I don't want big brother google all up in my business.

rocao

@rocao, Wow!!! You must have bought very early in the company's history. 60k will buy a lot of lego, assuming you didn't sell any shares yet. I know someone that got in very early on apple, but he sold his shares almost two decades ago for a fancy sports car. Disappointing, considering he could've bought a mansion if he waited long enough.

I bought the bulk of my shares in 2004, so it wasn't early relative to company history (IPO December 1980) and it was 3 years after the introduction of the iPod, but it was prior to the historic run up. And the $13.27 was my price per share, not my total initial investment, so yes, I could buy a lot of LEGO :P

weinner

^^^ lucky man.

dougts

^^^^ I know, I hate apple products, but people are lemmings and keep on buying the stuff. I told my broker one more ipad and iphone, then I'm out. So far an ipad has came out so we'll see.

I actually love their products, I just hate their business policies that make it exceedingly difficult to transfer items I own around to various devices/computers I own.

DaddyDeuce

^^ Early Thomas Kinkade may be viable as an asset class, but later Kinkade products are of diminishing value.

http://www.thestreet.com/story/10863800/6/5-completely-worthless-collectibles.html

Multiversal

Being sixteen years old, and having only recently started on my first part-time job, my collection so far has been funded by allowance, birthday/christmas money and gifts. However, now that I start to make a bit of money myself (just a bit, mind), I figure I might be able to afford something I haven't been able to before: the near-mythically reputed Modulars.
Then I thought of something else: If I can afford one, I might be able to afford two. This would require me not to buy any other Lego for a while, but I'd probably be able to handle that. Anyway, the idea was that I'd buy two of the same Modular building, keeping one unopened as an investment (and, quite obviously, building and displaying the other).

According to [email protected] in Denmark (where I live), each modular in current sale is priced at its original 1400 DKK (except for Town Hall, which is 1500 DKK). I've checked the UK [email protected] as well, though, and the pricing there is quite intriguing: Apparently the sets are marked down for each set that follows it. The oldest, and thus cheapest, of them, Fire Brigade, is now down at 100 GBP, which equals roughly 800 DKK. Compared to the original 1400 DKK, you see, that's something of an offer.
However, the British [email protected] won't ship to Denmark, so the only solution is for me to contact a friend of my father's who lives there, and ask him to recieve them and bring them along the next time he's in Denmark (which seems to be in August).
Judging from pictures, my favourites are as follows (from most favoured to least favoured): TH, GE, FB, PS. The prices, however, are too much for me if I was going to get two of any other set than the FB.

Knowing these facts, what would you do in my situation? And what, by the way, is the expected resell value of an MISB 10197 Fire Brigade in, say, Anno 2020?

Thanks in advance. =)

Thezoofox

FB will almost definitely be the next modular to EOL so for my money that would be the one to get. It's actually a lot of peoples favourite due to the interior build. Resell value is a whole different speculative area. Although you would almost certainly see an increase in price over 5 years for a MISB FB.
Hope this helps

Diggydoes

I would highly recommend to check europe's different amazon-pages(.es .it .co.uk)! They ship international and if you do some research you will def.find good prices on the modulars! For example,amazon.es had the Pet-Shop for 107€!

Multiversal

@Thezoofox:
I'm glad to hear that the FB is a set worth getting, anyway. Still, I really don't want to miss out on GE, but I'll just hope to have the money for that next year.

@Diggydoes:
I tend to rely on Amazon.co.uk for many things, but that doesn't have any of the modulars listed below regular prices. Besides, the boxes are quite large, and Amazon often adds a whole lot for shipping, so I don't think that's quite the best solution for me (I was hoping to take advantage of the current free shipping for more than 75GBP-orders offer at [email protected]). But thanks anyway. =J

Diggydoes

Well i currently bought two modulars and paid about 10€ for shipping (to Germany) on Amazon.es,that brought each Pet-Shop to 112€! I'm pretty sure you won't get it cheaper anywhere in Europe!

sidersdd

Toy with LEGO, not with art. :-). You'll never find an art consultant that will recommend buying anything by TK. He's not an investment grade artist. If you do find one that does, run... You're likely in a TK gallery. :-)

Say a TK master edition (which is still just a lithograph that he's painted over, not the original painting) costs $5, in a questionable market (meaning its not growing for whatever reason) You'd be better off working with a consultant to find (5) up and coming artists with aftermarket potential and buying 5 pieces at $1.

Whoa, that Thomas Kinkade dude you guys were talking about just died.
http://www.mercurynews.com/nation-world/ci_20344195/thomas-kinkade-one-nations-most-popular-painters-dies

DaddyDeuce

Whoa, that Thomas Kinkade dude you guys were talking about just died.
http://www.mercurynews.com/nation-world/ci_20344195/thomas-kinkade-one-nations-most-popular-painters-dies

Those EOL announcements always come so unexpectedly.

Sorry, couldn't help myself.

allmybricks

Tragic. Sad to see so young. :-(

Talk about speculation though... The market for his work immediately after death will be the best opportunity to get any money out.

LegoFanTexas

Sad, only 54 years old... weird that we were just talking about it here, I feel kinda bad for bringing him up... :(

You say just after his death is the best time, you don't think it is his death plus 20 years? 50 years? There is so much of his art out there, it isn't "rare" other than the very high end stuff he did.

Perhaps it depends on what his family does with the estate and how it is marketed going forward...

LegoPodcaster

Any ideas on how the POTC sets will do once they retire? Any predictions on which sets from POTC will do the best once retired? I personally think the Captain's Cabin is a really nice set and should do pretty decent.

dougts

^ the two ships. anything other than that is a crapshoot. Being a license, I don't see any of them necessarily cratering, but not sure there's any huge growth potential either.

pteric

I really think they will do OK. I don't think POTC sets will be re-hashed and reproduced like a lot of Star Wars sets are.

Si_UKNZ

I'm with dougts -the ships will do well, but the rest won't. However with the possible exception of captains cabin as a small 'minifig pack', and part of me hopes cannibal escape will also do well, as I love that set, however RRP was too high to start with so not likely to go far above RRP if at all. I do think the minifigs will continue to do well and some might go very high like the mermaids and the Penelope Cruz minifig.

CCC

I found that small sets from the HP range did very well if you can get them at 50% off. They have a high number of minifigs to parts, and hence if you resell the minifigs by themselves, then you can get a good return - if the minifigs are popular. I have sold parted out minifigs from Freeing Dobby and Forbidden Forest sets for on average about 1.5x RRP for the whole set, leaving me with free parts and a decent 2x profit / 3x return on what I paid.

Of course, it is a different market you are aiming at.

I reckon the same will be true of smaller POTC sets too.

Brickarmor

Browsing by year in the Brickset database: if the set is still produced the "shop Lego.com" will appear in the right column, correct? If not then it has been discontinued, yes?