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Quiet Speculation: Wake, Rattle, and Roll
Posted on January 20, 2010 by Kelly Reid
Hi Kelly,
I just got back into MTGO after about a two year break. I’m mostly a casual player, I used to love the leagues and drafting, but I was mediocre at best and tended to keep the cards I got to build my collection as opposed to trading them away. Playing that way ended up burning through a lot of cash so for now I’ve been sticking to the casual room, mostly pauper formats.
You make it sound easy to ‘go infinite’ just by making savvy trades. For someone starting from scratch today how would you recommend I invest my money? It seems like the height of extended season is a poor time to enter the market, should I wait for the next competitive season? How much money should I put in to get started? My goals are to finance limited play and slowly build my collection from there.
When you do invest in a card how many playsets do you buy? I assume this changes depending on the price of the card. Do you have risk controls, for example investing no more than 1-2 percent of your total trading ‘portfolio’ in a single card?
Also, where do you buy and sell your cards? E-Bay, mtgotraders.com or another website? Or do you keep it all contained within MTGO and use the bots?
As for my opinion on selling out of an investment when you’re at break-even or lower – I think you should consider selling out at any new rotation. The competitive season switching from Standard to Extended, a set rotating out of Standard or Extended, or a new set spoiling a replacement card might all lead to an erosion of demand, increasing your loss.
Psychologically we are prone to be conservative with gains and risky with losses, which is the exact opposite of how you would ideally trade the stock market. I imagine it is similar with MTGO trading (though hopefully on a much smaller scale). Sometimes you just need to cut your losses before they become crippling. As you say in your Sedge Sliver example, there is a price floor for most MTGO rares, but if you bought in above that floor, then holding on to the card until it hits bottom is very similar to holding a stock to zero.
Thanks for the articles, really interesting and helpful stuff.
Yep, keeping cards is a good way to burn through money. In general, playing MTGO is a good way to do that! You don’t have to be a Scrooge McDuck like me but making savvy trades will at least fund the adventure so you’re not cashflow negative.
Obviously pay attention to my articles, and others who write about MTGO. The trick is to locate and purchase shooting stars before they “pop” and go off. The time frame is irrelevant – you can start right now. Your goal is to keep an eye out for “crap rares” that shoot through the roof. Look at Living End, went from .15 to like 2 bucks. I bought like 16, so that paid for a draft right there. Your goal should be to double up on everything you buy, and anything above that is bonus. You have to learn to recognize those cards and be willing to sit on them for a week or two. I bought Living End on a tip from a friend in the know, and shared it here as soon as I was able. I’d invest at least 100 tickets to start if you can.
It’s all dependent on your bankroll. I never like to have more than 60% of my tickets invested (you can count money in paypal if its earmarked for MTGO too) at all, because i NEVER want to be forced to sell something. If its a cheap card like a 15 cent rare, I usually don’t buy enough. Idealy, I think 5% of your overall portfolio is the most I’d spend on a given crap rare. I usually go with 2-3% or less, but you can usually at least break even most times, as long as your basic hypothesis isn’t TOTALLY wrong.
I use ebay, a few sites, and mtgolibrary to locate bots with the best prices. It’s all about the price to me. Bear in mind when selling stuff that you have to either keep track of fractional tickets or deal in whole ticket intervals. Just a pain either way.
I mainly am talking about low-dollar stuff when I say that you should hold on to it. If you are heavily invested in tournament staples, like say Extended stuff from Mirrodin, blow that shit out as soon as you’re done with it. It can only decrease. I’m talking more about like the 6 playsets of Aven Mimeomancers I have on my account right now. Yes they’re probably going to sit there forever, but I want to have them in case someone decides they’re playable again and wrecks face. We DO have a Standard Pro Tour and PTQ season coming up.
“”Psychologically we are prone to be conservative with gains and risky with losses, which is the exact opposite of how you would ideally trade the stock market. I imagine it is similar with MTGO trading (though hopefully on a much smaller scale). Sometimes you just need to cut your losses before they become crippling. As you say in your Sedge Sliver example, there is a price floor for most MTGO rares, but if you bought in above that floor, then holding on to the card until it hits bottom is very similar to holding a stock to zero.”"
Yes, which is why I avoid buying cards that are expensive. Frankly, trading “penny stocks” in MTGO is about the least risky thing you can do online. When evaluating a card not close to its minimum price, you should ideally understand the factors necessary to bring it lower.
This didn’t get included in the original article for some reason, likely my own oversight:
Mirrodin cards represent a LOT of the staples in competitive Extended decks right now, and as such are ungodly expensive. This is the last Extended season before Mirrodin rotates. Why do you think there is such a massive price disparity between buy/sell prices on the bots? I’d sell my Mirrodin stuff for as much as I can before the last PTQ of the season, or else risk taking a loss. People aren’t really thinking ahead to the rotation yet, but you can bet your Chalice of the Void that when it comes, the price drop will be fierce.
So what do you think will be the chase rare in Worldwake from what you have seen thus far, Mr. Reid?
KBR, i think the reply post to mark could be expanded in a full article to teach how to getting started. Also, how do you sell your stuff? i ask because mtgo profit are not my job and i won’t dedicate that much time to it, but since i do occasionally “get there” (i bought living end with your guidelines before i knew you knew about it
i’d like to earn some tix 
This is my first attempt at playing the MTGO lottery … I picked up 30 Root Mazes at 10 cents each in light of the previewed Worldwake card: Amulet of Vigor.
Is this the kind of interaction that could spike the price of Root Maze … or am I way off base here?
Thanks
I’d also love to know how you sell stuff. To bots? I’d love to cash out some juicy stuff I don’t need anymore, and don’t know how to do it best.
hmmm i may need to try this, normally i only buy tickets for cards i actually want to use. Though following this advice seems like a good way to turn 100 tickets into more
With the announcement from Wizards regarding the eventual support of Legacy on MTGO, Legacy-specific staples such as Counterbalance, Sensei’s Divining Top and Sea Drake seem like strong long-term investments for players with some spare tickets to invest. Any thoughts concerning Legacy-related investments?