Comic investing tips #4: Understanding comic prices and movie hype

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I have stated in the Google+ community that “appearance in a movie” is no longer a good reason for speculating or investing in a character or issue. There are going to be so many characters on screen in the years to come that appearing in one is no longer a special event. However, I still see lots of readers and members using movie appearance as the sole reason for comic price appreciation. I think it is time I dig a bit deeper to let you know what is really happening.

 

It is expectations vs actual correlation

For something like movie hype to affect real prices, there has to be something real. In the beginning, the train of thought goes something like this:

  • Movie success = lots of new blood or fans
  • Some of them will become comic collectors and pay money for key issues
  • Prices increase

Unfortunately, after numerous movie events such as GOTG, Winter Soldier and even Antman, we can see that the successfully box office hits didn’t translate to more fans who will spend money to buy our keys. In other words, movie successes didn’t translate to more demand for the comics.

Given that there is no real correlation between movies and comic prices, what then is the real reason that comics tend to experience appreciation when news are announced? It is expectations. In particular, it is the expectation of speculators and collectors that future prices will increased due to the rationale explained above, which resulted in them grabbing books either for resale or to avoid paying future higher prices. This increased in buying pushes prices up, leading to the wrong conclusion that movie news tend to move prices because there was a fundamental change in comic buying market.

So, given that it is expectations that move prices, and not any real change in demand, we have to be careful. Expectations can shift very easily and we are now seeing part of that happening. Collectors or speculators are no longer so eager to grab a book just because of some movie news, which resulted in prices responding less aggressively. This in turn will further dampen expectations, resulting in a slow circle that movies wouldn’t matter much anymore.

 

Real demand drivers for comics

At the end of the day, it is still the comic collecting community at large that will affect prices, not some hypothetical new blood. As investors, it is up to us to come up with a list of demand drivers that will affect real change in buying behavior among collectors, which eventually will affect comic prices.

An example of such a driver? Market talk is one of them, especially at places where many collectors gather such as the CGC boards.

If you are a savvy investor, you would spend time on comic forums, facebook groups and G+ communities to see which book is being talked about, not for speculation but as something they really liked. These books tend to see strong price appreciation in the secondary market. A good example is what they call the club. Everything a club forms around certain issues, I see an uptick in comic prices for these issues. This effect is real and is something you should look into.

Another example of a demand driver is being published and marketed regularly. The saying that out of sight, out of mind is so true especially its converse. When a character is being published and gets constant PR on comic sites, their first appearance tend to appreciate as well. This effect is real and is not dependent on hype. Comic books do affect comic readers, who will think about collecting a character’s first appearance to complete their collection.

If the two big drivers coincidence, i.e. lots of market talk + constant exposure through publication, we will see an explosion in prices. Moon Knight and his WWBN #32 is one example. Squirrel Girl as well. Even Gwen Pool is the result of these 2 forces coming together.

 

Conclusion

If you want to get ahead in comic investing, it is time to reduce your dependence on movie hype and look for real factors that drive comic collector’s behavior. The better you are at this, the better you can predict which book will be the next WWBN, GwenPool Variant, EOS #2, Supergirl #23 etc al. Good luck!

2 thoughts on “Comic investing tips #4: Understanding comic prices and movie hype

  1. Great article – and I totally agree. This is something that has frustrated me a few years already – as so many speculators seem to only care about the next movie/tv appearance. While agree there is some quick money to be made on the right books generally this is not the way I recommend anyone to invest in comic books.

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