Buying comics can be a difficult business to master. You need to have a keen eye, good business sense, and an ability to size up the market to make a profit and avoid a loss. However, is there ever a time when taking a loss is the correct move? Over the short-term, you want to avoid losses in order to perform as a profitable speculator. Quite often though a longer-term horizon can yield stronger results. The key is to be able to take the loss in the short-term and that requires cash flow. Can money be made from an initial loser purchase of a known popular comic book above market value? Further, how does a slabbed and graded book fit into this short-term cash flow loss? Using “The Killing Joke” let us examine the anecdotal evidence and why a decision is made to purchase at a loss?
Costs of Slabbed and Graded Books (rough estimate)
The cost of slabbed and graded books is not cheap. It runs between $18 and $28 per book not including Fastpass or some other add-on. Further, you pay freight to the company doing the grading and back to your home as well. That essentially means a minimum of $35 to the graders and another $35 back. So now we are looking at another $70 of cost to have your glorious book graded. Basically, it runs anywhere from $88 to $98 to have one book sent to your grader of choice. Obviously, the more books you send the cheaper the shipping can be, you get the idea.
The Killing Joke (First Print)
The Killing Joke was part of Joker’s rise to power as the most popular villain of the DC Universe. This book was written by Alan Moore, he shreds the last decency as the villain of yesteryear from the Joker and puts on the big boy pants of destruction and sadism. This book was created in 1988 and the art (pencils and ink) was done by Brian Bolland. For the time it was one of the most impressive images of Joker to date.
Buying at a Loss
I recently purchased a book slightly above its market value. The Killing Joke (First Print) had already been slabbed and graded at an 8.5 grade. The price from the collector was not unreasonable at $85. It was a little high $15 above the FMV of $70 for this comic book. Now, this particular book has 14 different prints. Some had next to zero value, while others are rare and more expensive than the first print. I have three rules I follow buying at a loss.
- The character and book must be popular
- The price cannot be higher than 30% above the regular market price.
- The chance for a future catalyst (movie or TV series) must exist, we certainly aren’t going to see the 3D-Man anytime soon in a Marvel movie.
This Killing Joke checked off all these boxes, and I had always wanted to own a copy. I didn’t buy it to crack the case and press. It was already a guaranteed grade when I purchased it, and someone had spent a great deal of money getting it CGC’D. I didn’t have to worry about getting a bad grade sending in a rag to be slabbed. I was purchasing a known quantity which is the benefit of trading in and out of CGC slabs. In a nutshell, I traded the uncertainty and additional cost of CGC for a lower grade and a book in-hand. Prices for slabbed books fluctuate drastically, especially above near mint-minus so if I really was stuck I could just sell at the nearest upswing.
This was only a small risk for a primary character and a very popular book. I felt I could resell it at a moment’s notice for most of what I had paid. Further, when I calculated using GoCollect.com the analysis matched my understanding of future value. Namely, by calculating the one-year return trend in a grade 8.5 which has returned a positive +27.5% profit trend; then if that pattern held I would be in the money in one year and in profit in two. This last point is the most important part of my thesis summed up best with this old proverb, “A bird in the hand is worth two in the bush.”
This purchase was not even a long shot, simply a high probability of success despite buying at a loss. Sometimes with investments, the guaranteed return is worth an initial overpaid entry fee. You don’t need to strangle the Joker within an inch of his life to get paid off like a hero.
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Your perceived value is not buying at a loss. Often, listed prices fail to reflect rarity, which matters much more than demand when the supply is very low. There isn’t any point in paying over listed prices when a comic is common; give it 5 minutes and another will be listed at that price. The difference comes when a comic comes up for sale once a year or so, or similarly, when the demand for something rare is so high that there is great competition for multiple copies per year. In that case, you can throw whatever “guide” you follow out the window. This is not to mention the fact that scarce books also carry unique properties. Sure a copy has not come up for sale in a year, but this is the only CGC 9.8 or, for Golden Age books, this copy is FN or better. In those cases prices blow away arithmetic progressions but do not do so in an irrational way.
Norman, Thanks for the article. You made a statement though that I think needs more analysis: “I was purchasing a known quantity which is the benefit of trading in and out of CGC slabs.” I feel that more and more often now, slabed (CGC’d) books are not a known quantity. Lately I don’t think I can trust the grades, they are all over the place and not consistent. This makes it hard to trade as you say. As you mention, getting books slabed is not cheap, we need to be able to trust and count on consistant grading. I don’t think we are getting that now. Can you do some research and an article about that? thanks
I did the same with a 9.2 Son of Satan #1 I paid $11 more than guide.
Its a great buy but if the books goes up, the only grade you want to be in is 9.8. Everything else is playing nickels and dimes
How did you calculate the one-year return trend? Thank you!
Nice article. It gives collectors, flippers and readers the idea of ROI for slabbing books. I ALWAYS get everything pressed and cleaned. When I do modern books, I do at least 10 issues. It helps bring the shipping cost average down versus doing 1-2. I pay shipping to my presser, average $2/book to get there. Pressing is $12/book. His handling fee to CGC is $1/book. Shipping to CGC $2/book. Grading is $18/book. Shipping to me is $2/book. The shipping costs are the average for me.
The average cost to get a modern book pressed/graded/shipped is $37-$38.
$37 + $3.50 = $40.50. That is what I have invested in my copy. It came back a 9.6. FMV is $110. I’m ahead $69.50 in a perfect world. I had no qualms about investing another $38 in it as I only have $3,50 ($7.70 in 2021 dollars).
You will be ahead of the game if you do your research. You made a sound investment that will give you a decent return in the future.
It does make me wonder sometimes when the value of a 9.8 is talked about. There’s a lot of shipping and handling essentially baked into that value. The book itself may be commanding a price of 100 graded, but you’d have to own or find a dirt cheap bargain book and slab it to realize that value yourself. And the comic hasn’t gained anything but the guaranteed grade, which hopefully could be used to gain a higher resale value if and when the comic becomes more valuable.