Sports Memorabilia Offer 'Immense' Upside for Wealth Management Firms

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If you collected baseball cards as a kid and long ago tucked them away in the attic, you might want to do some digging because sports cards and memorabilia have grown into a multi-billion-dollar business. Last year, several cards alone fetched 7 figures, including a 1952 Topps Mickey Mantle and a 2003 LeBron James rookie patch autograph, each of which sold for $5.2 million. Also, a 1979 Wayne Gretzky rookie changed hands for $3.75 million, but the top sale last year belonged to a century-old Honus Wagner card, which sold for $6.6 million. Welcome to Barron's The Way Forward podcast. I'm Greg Bartalus, and today we have an exceptionally special guest, Howard Epstein. He's a Charlotte, North Carolina-based wealth management advisor and lifelong sports memorabilia consultant and expert. Expert. His professional career spans banking, insurance, and financial services, and he's promoted sports cards and memorabilia shows for over 3 decades. Howard will discuss an opportunity for wealth management firms that he characterizes as, quote, immense, highly significant, and virtually untapped, end quote. He will also explain where the market is, how we got here, and where he thinks it's headed. Howard, welcome.

Thank you, Greg. I appreciate the opportunity to be here and speak with your listeners today.

Excellent. Well, thank you so much for joining. Before we discuss the opportunity, tell us a little more about yourself and describe the state of the sports memorabilia market today.

Well, as you mentioned, I'm a lifelong sports card and memorabilia enthusiast with a passion for the hobby. I have been a collector, a dealer, investor, show promoter, appraiser, and consultant. I had previously run sports card shows, like you mentioned, in 3 different decades. I was an inaugural member of the National Card Collectors Association. I was a co-founder and past president of the South Florida Card Collectors Association, and I possess one of the largest collections of price guides, periodicals, and books on collecting sports cards and memorabilia dating back to the 1940s. In my professional career, as you mentioned, I— it spans banking, insurance, and financial services. I've been a finance manager for a large bank, I ran my own insurance agency for 18 years, and currently I'm an inside advisor for a wealth management firm and have a Series 7 and 66 license along with my insurance licenses that I maintain and have a spotless U4 record. As far as the condition of the market right now, obviously since the pandemic started it's really started to boom, but really it's been booming for probably 5 or 10 years. It's just that the pandemic really picked up the pace. In my paper, which we'll discuss, which I actually wrote just prior to the pandemic, as you know, when the pandemic began, most professionals were and may still be working from home. With extra time on their hands, they were seeing reports of high-dollar sales, which you'd mentioned, and found their old collections and began to submit to the grading services. This overwhelmed the services, and then they ended up shutting down their submissions for collectors. A little prior to that, in April of 2020, the ESPN series The Last Dance on Michael Jordan's last championship aired, which really ignited the hobby even more, especially for high-end Jordan memorabilia. His PSA rookie card, for example, graded a 10 prior to the pandemic, was trading around $20,000. During the pandemic, it traded as high as about $850,000. Even today, it has retreated is still trading in the $200,000 to $300,000 range, 10 times more than pre-pandemic. Everything of Michael Jordan's has increased—jerseys, sneakers, and cards. Even a debut full ticket graded a 6 out of 10 recently sold for $264,000, which is astronomical. Big money has flowed into the hobby, not only in the sales of items, but the new companies that are forming. Fractional share ownership companies, for example, which I know we'll cover later. High net worth business executives and professional athletes are getting involved in the hobby as well. The pandemic has opened up and increased the speed of the hobby becoming a go-to alternative investment like the art market has been for years. eBay alone sold more sports, sports cards in the first quarter of 2021 than all of 2020 combined. The hobby is increasing at an increasing rate.

Well, tell us now about the opportunity detailed in your white paper because you just described the macro landscape very well. And later, let's talk about the third-party grading, which you alluded to, because a lot of people may not be familiar with that. And it's exceptionally important to the hobby. But speak about this opportunity.

Well, when I wrote my white paper, I was thinking, how could I help these clients at the wealth management firms? And I thought that there are tens of millions of collectors of sports-related memorabilia in the United States. And it was reasonable to assume that there are hundreds of thousands, if not millions, that are wealth management clients. It also stands to reason that the clients who have more disposable income have greater collections that are more valuable than the average collector. It seems unreasonable to overlook this potential revenue stream and obvious customer retention service. What happens generally is when someone that's a wealth management client who perhaps may have a nice collection either passes away or ages out and wants to get rid of their collection may not know the avenue to do that best, especially in a death situation. And you know, people die from hundreds of different things, and usually it's the male who's the collector in the family, so the, the wife in this situation doesn't necessarily know where to go to liquidate their collections, assuming they want to do that. Most of the wives over the years I've spoken to are saying, 'I can't wait until I can get rid of this stuff so I can get my room back.' So there's a need for somebody like myself doing that at these firms, I think, because it will help these clients liquidate for a higher price than they could get locally. Usually a local person will get 10 or 20 cents on the dollar when they go into either a local shop or contact somebody that's advertising locally in the paper versus getting as much as possibly 90% going through an auction house that I have many contacts with already. So it's a really, it's a win-win-win situation for the client, the advisor, and the firm itself because the client who gets more money for their collection is obviously happy. And there's a citing in the paper that says that 70% of spouses that have a spouse that passes away leaves the firm within 1 year of the other spouse passing away. So not everyone's going to have a collection, we understand that, but the people that do and we help through the firm will most likely not leave the firm in those situations. And it's not just people that have collections, You have clients who inherit collections from, you know, people that pass away. And in some cases, in some cases they don't know, you know, what they've got on their hands. So that happens a lot too. It's not just people who collect, it's people that may inherit something as well. And it's not necessarily a large collection. It may be something, just a few pieces, but it may be very special pieces that they would best find out about through something like this program, which would benefit them. The, the bottom line is that it's a win-win-win situation. I know that advisors look for 2 things primarily with their clients: 1, to financially look after the well-being of their client and their assets, and 2, to increase their owner— to own assets under management. This program helps the advisor with both those both of those for clients who may have a need. And so I certainly would welcome any C-suite executive at a wealth management firm to reach out to me to discuss how I can help with their clients.

Is it really about 10-20% on the dollar? I mean, I've even heard of far worse than that in terms of— It could be.

Yeah, it could be. It really depends on the situation. I had a situation just this morning that I was discussing with an attorney here in town that had a collection that I was looking over, and she had mentioned to me that she had brought some cards over to one of the local shops. And the shop owner— and they were 1939 Play Ball cards, and on the back of those cards there's two different versions. There's an all-caps version for the player themselves, and they're just the first letter of their first initial of their first and last name as a different version. And the owner of the shop said that he thought some of those were fake. And I don't know that this was a situation where he really didn't know what he was talking about, or it was something that he was maybe going to try to buy at one of those 10 or 20 cents on the dollar deals. So I can't say, but this stuff happens weekly. I mean, you hear locally— not locally, but nationally— you hear of these high-dollar sales, or this guy a couple of years ago, this guy Uncle Jimmy was in the paper. He was 97 years old. He passed away up north. He didn't have any children, never married, and he left his collection to his nieces and nephews. They ended up selling it for over $2 million. So those are the things you hear about. It's the things you don't hear about that are out there that happen on a weekly basis that can, you know, help their clients, you know, in this situation, because it happens a lot. You just don't hear about it. Right, right.

So let's widen the lens now. And I think You've described that exceptionally well, the opportunity. Now let's talk a little more about the hobby, which is really a business now. Hobby's almost quaint, right? Given where it is with the dollar amount. Like the art market, sports cards and memorabilia are definitely seen more as a viable alternative investment. Given where interest rates are, stock valuations, I mean, tell me more about, for people looking to diversify beyond traditional asset classes, where do you fit in the whole investment spectrum?

Well, I see the sports memorabilia, sports cards and memorabilia market has really started to take off, like I said, in the last 5 or 10 years. And I think a lot of these high net worth people are looking at this market and seeing where they can diversify. You know, they've been diversifying into the art market for years. There's issues with the art market itself, and I'm not an art expert by any means, but I know that there were some forgeries years ago. Things like that. So, and it's also difficult sometimes to store those items where these are smaller items, usually especially cards or small items, you can keep them in a safety deposit box and things like that. They are gradable, and so they're certified as to what they're graded at, and there's— we can talk about the grading company soon. So there's a lot of advantages to having these, and people love sports. I mean, in general, people just love sports, you know, if you go over someone's house, they may have a painting. Maybe you like it, whatever. But usually people are involved with sports, and if you have a 1952 Mickey Mantle card, you can pull it out because it's been in the news and say, look, here's what I got. I got one of these cards, and it's graded maybe a 7 or 8 or whatever, and it's a valuable item. So things, things are looking up in the market. People are just craving these things, and there's a scarcity to these things because there's an infinite there's not an infinite market, obviously. It's a finite market. And it's—

There's a nostalgic element too, as well. I mean, if you buy, let's say, precious metal, either physical or an ETF, it's simply the metal. There's really no strings attached. But with cards, with memorabilia, there could be memories attached. It might remind someone of their childhood, et cetera. And it's situated in an era. So it's a part of Americana, really, as well. It transcends the investment world in a few ways. I did want to point out something that I found extremely interesting about cards and memorabilia is that although they are an alternative asset, they really trade in many ways, behave like stocks. For current athletes, the prices of their items generally reflect their popularity, their performance, and then expectations, their future promise. But again, with vintage rather, which are, you know, older, some people say 1975 before, etc., it's a different risk-reward, right? You're looking at if you buy an established Hall of Famer, their numbers are in the books. It might not skyrocket overnight. It certainly won't. But it's a little bit of a safer bet. Can you just tell me a little about that and also how what led to the junk wax era whereby in the past, traditionally, scarcity was a byproduct. It was really an organic process. They made the— no one thought about it in the '40s, '50s about preserving them. They just treated them willy-nilly. Hence, it's hard to find them in great condition. And then more recently, everyone started to protect them, but they made a lot. And then tell me what happened more recently with manufactured scarcity and where we are today?

That's part of the allure of it being an asset class because, you know, you can buy 10,000 shares of Facebook, but you don't really take possession of the shares. Nobody really does that nowadays. And so somebody comes over and you go, "I got 10,000 shares of Facebook." "Big deal, but you don't have anything to show me." As opposed to, "Yeah, I have a Mickey Mantle jersey from 1964. It's on the wall over there and it was signed by him." That's something that's eye-catching and a conversational piece. So, People like the investment part of that and be able to show people. As far as the vintage things, you're right, the things back in the '30s and '40s and '50s when they produced those things, the kids didn't take care of them like they do nowadays. A lot of the things that were lost actually during the war and the paper drives. So a lot of those things went out, you know, beside the mothers threw them out, you know, all that kind of stuff. So that lowered the availability of what's left. And of course, the scarcity on the higher-end stuff is very, very scarce. And you can see that in the population reports on these grading companies. Junk wax— what happened in that era there is that the card companies— and I'm a guy that thinks '75 and prior is vintage, I go with that number— but what happened in the early '80s, the the card market really was heating up, '81 and so forth. And then in about '83-ish, mid-'80s up until the early '90s, the card companies just overproduced like crazy. They were just cranking it out. And so therefore there was so much material on the market. It's a supply and demand issue. So the supply was way outnumbering the demand. So there was a drop in value. Especially in the junk wax era. It's starting to come back a little bit now because of the people that like to open up and do breaks and things like that. And so some of this stuff is starting to finally, you know, get off the shelves. But there is so much of that stuff produced. And so the card companies figured out how to alleviate that or how to avoid doing that by producing a little bit less, but also taking advantage and doing what I call the manufactured rarities or the chase cards. So what they would do is they would insert in the packs that they wanted to sell, you know, obviously their boxes and their cases, they would insert a 1 of 5 or 1 of 10, 1 of 100, whatever card, and it would be labeled as such, and some cases it would be signed. So some of these cards have skyrocketed in value, and that's some of the stuff that you see on this, you know, $4 or $5 million stuff is a 1 of 1 or 1 of like Tom Brady, for example, he's the GOAT in football. And so they've got his rookie card as 1 of 100. And if it's graded right and it's a signed card and the signature's also graded on it, you know, some of them have gone for $4 or $5 billion. So it's just very expensive stuff on the new stuff that's, in my opinion, a manufactured rarity versus the older stuff that's, you know, was produced in probably great numbers in some cases, So much of it was thrown out by the mothers or the paper drives during the war that there's just the scarcity of what's out there, availability from a supply and demand issue. Okay.

You also talk a lot about memorabilia beyond cards, and I think that's something that's a lot less understood. There's a lot less knowledge, but it certainly seems to be a burgeoning, growing area. Tell us some of the differences or pros and cons, rather, of sports cards compared to to, you know, game-used items, etc., just on a high level.

Well, that's true. There's sports cards, and sports cards are not only baseball, football, basketball, hockey, but it's golf, it's soccer. It's— there's everything out there nowadays. And the memorabilia itself is either the jerseys or the balls or bats or helmets or gloves or spikes, shoes, sneakers, whatever. Some of them are game-used. They're authenticated. There are companies that authenticate these things. And so if you— and most of these are one-of-one type situations. Recently they've got like a Seth Curry, you know, his jersey that he wore in the game that he broke the 3-point shooting mark. You know, something like that is fairly valuable. They just nowadays the new stuff, they authenticate stuff right away. They have, you know, markings on things like if someone's going to like Like when Barry Bonds broke the home run record, they had balls that were numbered and they specifically gave those balls out to the pitchers when he came to bat so that they knew the right stuff, you know, as far as that was the item that was hit for the home run and so forth and so on. So these items of memorabilia are getting more expensive, and I think rightfully so. Some of the jerseys out there that are just, you know, Hall of Famers, especially deceased Hall of Famers. You know, as we've talked about, Greg, you know, a Hall of Famer, even though, you know, their career is over, their life may not be over. So, somebody, I'll give you an example. Just throw out one name, O.J. Simpson, okay? So, obviously everyone knows what he did and the thing from, you know, 25, almost 27 years ago. He's, you know, been retired for a long time, but he's still alive. So somebody like Hank Aaron, who recently passed away, never had any things like that to go on in his life. He's in the record books. He's— it was a great hero. And so things like that, any of his items, any jerseys, bats, signed balls, whatever, have increased in price since his passing. And the only one that's left out there that's really in that era or time frame is Willie Mays. Willie is, in my opinion, one of the best ballplayers that ever lived. He's about 91 years old now. I'm not sure how much he's going to live. He obviously— he's in, I think, failing health, but hopefully he'll stick around a while. But when he passes, his stuff will increase as well. So if you're looking for an investment, you know, that type of thing is to look for obviously the Ruths, the Garrix, you know, the people that passed away many years ago. If you can get anything of theirs, obviously it's very expensive and very desirable.

Yeah, I think on Mays, I used to think Hank Aaron was the greatest of all time. I think right now I'd probably put— it's either Ruth or Mays in my book, and then Hank Aaron number 3. But those 3 are, in my estimation, perhaps the best of all time. But you could debate that endlessly.

So Aaron was one of my favorite ballplayers of all time, but I'm not sure he was the best.

Yeah. Let's talk about the all-important third-party grading companies. Such as PSA, which might be the gold standard in terms of fetching the highest prices. Just briefly tell, tell listeners how it works in terms of people sending in a card. What happens? They get it mailed back, takes some time, etc. But the importance of that and the population count, etc.

There are 4 major companies that grade cards now. You mentioned PSA. They're probably the most popular one. They stand for Professional Sports Authenticators. They started in 1991. The other grading services are BGS, which stands for Beckett Grading Services, and they started in 1999, and SGC, Sports Card Guarantee Corporation, started in 1998. And the recent entry is CSG, Certified Sports Guarantee. They're fairly new to card grading, although they've been grading coins and comics for quite some time. So you would submit a card or a group of cards into one of these authenticators, and they would charge a fee for their service, and they would grade the card, usually on a scale of 1 to 10. Some have half scales and things like that. Some grade differently, like CSG grades on surface and things like that. So they grade— the grades are obviously based on the clarity of the card, the corners, is it centered correctly or not, is there any print marks on it, and things like that. And you get back the grade, and it's graded whatever, 1 to 10, let's say, and it's in a sealed case, which is very hard to break, although you can break them out. And then you have a whatever card, you know, graded an 8, let's say. And if it's an older, you know, vintage card, especially of a superstar, you know, that's a pretty good card. And there's prices that are listed in the— like PSA, for example, has a Pop Report, which is a population report, how many 1s, 2s, 3s, 4s, 5s they've graded, and they also have a pricing guide to go by, although a lot of the guides don't go up to 10. They go up to 8 or 9 depending upon the, the year and the, the sport. So, but there are some out there that are obviously 10s, and obviously those grade very high. It's almost— I've described oftentimes to people that it's almost like on a Richter scale, you know, it's like a factor of 10 every time it goes up from 8 to 9 to 10. And it just goes parabolic up to 10. It's just an unbelievable rise. So a lot of the companies that they were inundated over the pandemic because people were submitting so many cards, they just got inundated with millions of cards. They had to shut down the submissions and hire a bunch of people to start grading their cards. They're catching up, but they're still not caught up yet. There's still submissions that they don't take, lower-end submissions. They do. They've opened it up for some of the higher-end submissions. And so they're still hiring people and grading. There's been a lot of, there's been a lot of activity in the market. Obviously, PSA, their parent company, Collectors Universe, was bought out and went private by Nat Turner. He became the CEO, displacing Joe Orlando, who was there for many years. So there's been a lot of activity in the market. A lot of fractional ownership companies have come up as well. You want to talk about that?

Yeah, well, I just wanted to go amplify a little more on the grading and the impact it had on the hobby. So one important aspect of getting cards graded is when it put the dollar amounts higher for those in excellent condition, and for people selling on eBay where there's a lot, and as well as other online auctions, it removed trust from the equation, which was a good thing in this case because there was a world of a difference in terms of value, often between like a 7 and a 10. But many people wouldn't per se pick that up on a computer monitor. And then some people might just say, oh, it's mint, it's near mint, when really it's very good, excellent, and what have you. So that created a lot of friction, if you will. And once the grading companies put hard, tangible numbers onto this, it added a load of liquidity to the market and a load of visibility, and it really instilled in a tremendous amount of confidence. At the same time, though, PSA graders or any grader, they're not perfect, right? You can see something maybe that's a 9 and it's a little more off-centered than it should be for a 9. So sometimes people can be very savvy and detect little inefficiencies and take advantage of them. And there's a saying, You know, buy the card, not the grade. And some people do that, but the number is still paramount. But the impact, again, of the grading companies has been really vast and just added so much to the hobby.

It really has, Greg. And I mentioned that in my paper as well, that when the grading companies started to come in in the early '90s, it really gave a lot of credence to the whole hobby. And it did solidify people's being able to you know, buy cards and feel comfortable about the grade and it was authentic versus maybe a fake or something like that. So you're absolutely correct about that. And there is subjectivity in the grading. You can look at two 8s and you can see maybe one's a little bit better than the other one. So there is some subjectivity to it. Some people have bought lower-graded cards and broken them out and resubmitted, and sometimes they have to resubmit them several times, but they may eventually get another grade higher, which obviously would be a significant dollar amount depending upon the card.

Right, right. And also, although it's generally advisable to buy higher, you know, higher graded cards when you can, there are times when, just like with stocks, there could be overvalued and undervalued. A PSA 3 might be a great deal, right, depending on who it is. So, and a PSA 10 may be vastly overpriced. So you really have to know how to navigate and be careful not to get ripped off.

Well, that's a very good point. I did some, uh, data things on PSA, uh, over the weekend, and I've got some numbers here I can go through with you, uh, just, uh, about vintage versus modern cards. For example, a 1986 Fleer Michael Jordan rookie card, currently it's in the $200,000 to $300,000 range, has about 321 10s, and this is PSA graded 10s, out of almost 23,000 submissions, which is a 1.4% total grade that, uh, at 10s out of the cards that are submitted on PSA. And if you look at, like, for example, a 1969 Lew Alcindor card, rookie card, who is now known as Kareem Abdul-Jabbar, on the PSA Pop Report, there's 2 10s out of a little over 4,000 submissions for a 0.05% of 10s on PSA.. And that card, my recollection is one card as a 10 sold for about $500,000 back in, I think, 2017. And I believe the last sale was around the $350,000 range a couple of years ago, I think, if my memory serves me right. But the data was not on the PSA website when I last checked, and it usually is. I don't know why they took that off. But other examples, an example I always give is the 1951 Bowman. Mantle card and the Mays card, both of which are their true rookie cards. And they're both high number cards in the 1951 Bowman series.

And high number just as an aside, high number just means it was a little scarcer, right?

Fewer were made. What happened is the card companies produced a series of, let's say, baseball series. Let's say they maybe did 5 series back then. I don't know how many there were, but and each series What happened is the grocery store at the corner would not order another case if they still had boxes on the shelves back in, say, August. So they, you know, the series that came out last was probably August, September, and they wouldn't get the order because they had, you know, the candy store on the corner would still have boxes left, and they didn't want to have them out there during football season, you know, because baseball season would be over. So they knew that, so they didn't order as many, so they didn't produce as many on the later series in most cases. Okay, and that stopped in 1973, but you know, prior to that they always had these series. So yes, a high number series would generally be more expensive. There's a 1957 Topps baseball, there's a middle series that's a little bit more rare, but other than that, usually the last series in a set is more valuable. So in 1951, Bowman's made the last series and had Mantle and Mays. They were rookies that year, and that's their true rookie card in 1951. And then in Mantle's case, there's only 1 PSA 10 out of 2,425 submissions for a 0.04% rate. And in Mays's case, there's 0 10s out of a little over 2,000 submissions. So if you flip over to 1952 and go to Topps, A lot of people love the '52 Mantle Topps as his rookie Topps card, but it's not really his true rookie card, but people think it is in '52. And that's a high number card also in the '52 high number Topps cards. As we mentioned, or I know we talked about this before, I don't know if I mentioned this, but Cy Berger, who ran Topps in 1959, decided he needed some warehouse space, and he took all his '52 Topps high number cases that he hadn't been able to sell put them on a barge, and dumped them in the Atlantic Ocean. So that's why the '52 Topps High Numbers are a very rare series. And Mantle happens to be the first card in the High Numbers series in 1952. But it also happens to be a double print in that series, where like Jackie Robinson is not. So there's twice as many Mantles as there are Jackie Robinsons out there. But Mantle, of course, is highly praised. And there happens to be 3 PSA 10s mantles in 1952 out of 1,810 submissions for a 0.06 rate. Now it's believed to be that these 3 10s came from a Paris, Tennessee find that Mr. Mint Al Rosen found in the 1980s. He found an unopened case, or a partial unopened case, in Tennessee back in the '80s. And most of the unopened wax packs from 1952 and the very high graded '52 Topps high numbers cards came from that one case that was found by him. So there's, for example, 1952 Topps Willie Mays card, which is a semi-high number, not a high number, only has one PSA 10 out of 2,581 submissions. So It's— they're very rare, especially that high grade. Almost even a common card back then in a high grade could be $400 or $500 easily. Yeah.

Well, and also, before we touch on fractional shares in the present day, could you just briefly talk about unopened wax? Because I think it's astonishing the percentage gains that were to be had by simply not opening the cards in the box, leaving them in the packs. Because if you think about it, vast majority of people would rip them open throw away the wrappers, et cetera. So there's a really, really lucrative market for unopened packs, even going back to the early '70s. I mean, I think some of that might go for $10,000 or more depending on the set and sport. Can you add any color to that? Correct.

Yeah, sure. Absolutely. You're absolutely right. The cards that are still in the boxes, still haven't been opened, are very valuable in most cases. The junk wax era, that's kind of an offshoot, but basically you're right. In the '70s, '60s, or whatever, if you've got cards back that far that are unopened, people are clamoring for these things. There are what are called breaks, which you can see on the internet. They do breaks and they do it live on the internet where someone, you know, say like I saw one, I think it was from the National last year, which I was at. They filmed it. They opened up a 1969 Topps basketball unopened package. I think it had 10 cards in it, and there was a, like, a giveaway thing as well. So there's 11 spots to buy. So the 11 people purchased, you know, the various spots, and they'd open it live on camera, and the first card would come out and it would be somebody, and that would be whoever bought that spot. That's how they do these things. But yes, the, the, um, unopened wax is just really a very, very hot item now. And especially the newer stuff too, because there's stuff that are, you know, these manufactured rarities are in some of these packs. And so people are clamoring for these things. I bought, just as an aside, I bought a 1977 box back in 1977 with a buddy of mine. And it was like, I don't know, $9 or something like that. And I kept it. I just left it and kept it.. And then about 15 years later, I was at a show with them and I said, I'll bring this, you know, I'll sell it. You know, I said, I'll sell it for $500. And I didn't care if I sold it. And a couple of times this one kid came by the table and he offered me $300. And then he came back, offered me $400. And I turned him down every time. And my buddy looked at me like I was crazy because he knew what I paid for it. I was with him. And I ended up selling it for $500, but that box today is worth about $3,000.

So, you know. Yeah, that's pretty wild. And there are, you know, some people unfortunately who will try to open packs, actually the wax ones, remove the valuable cards and carefully reseal them. There is, what's the, I forget the company, but there's one that's best known for authenticating that the wax has never been opened.

Do you know that?

Yeah, I think it's Baseball Card Exchange. Right, exactly. So that's a little pitfall, but there are certain packs like cellophane and the rack packs, which are like a longer plastic one, which are presumably much harder to tamper with. Yeah.

Correct.

That's right. Well, great. Now let's go to the present day. Fractional shares. Tell me about companies like Collectible, what this is compared to what we were talking about, the traditional version of just simply holding the card in your hand.

Okay. So, the fractional share companies, as you know, collectible.com is one of them. There's Rally, there's Alt, A-L-T, there's DIBS, there's Otis, there's probably some others I don't even know about. They're similar to— there's one for the art market as well. There's a masterworks.io for art market fractional shares as well. So, and I think that's a fairly new company as well. I don't know that much about them. But these fractional share companies attain a high-end piece of memorabilia and they sell fractional shares like stock shares, for example. So they'll, for example, get a piece of memorabilia maybe that's valued at $1.2 million and they'll sell $500,000 or $600,000 worth of shares at a certain price, maybe like at $10 or something. And sometimes they limit the number of shares the client can buy to 10 or 20 or whatever. And they usually sell out pretty quickly. But what you're buying— and they don't sell the entire piece, they sell usually up to maybe 50%, maybe a little bit less. And the person that consigns the item to the company retains usually 51 or so percent of the item, and they decide on what they think they'll sell the shares for. And so if it's a $1.2 million item, for example, and they'll sell $500,000, And then they're buying— the people are buying shares to assume that someone's going to come in and pay a higher price than what that item is valued for. And so if somebody comes in from the outside and does a private sale and says, I like that item, I want to pay $1.5 million for it, for example, and then they put information out to the shareholders and they vote on that as to whether they should take that offer or not. And depending upon what the offer is, and sometimes they'll sell it, sometimes they won't. So there's been a lot of these things popping up lately. The people that buy the shares, it's like buying shares of stock. You don't own the item and you're never going to get to keep the item and hang it on your wall or show it to your friends, but you're participating in hopefully selecting something that may increase in value over time, and some of them have done very, very well. So it's just another angle of the market and it's just exploding and expanding. The market itself is going in all directions and it's, that's why I think it's here for the long term. We mentioned before on a previous conversation about how long this has been around and the collecting market has been around for over 100 years. They started this stuff, but it really started taking off in the late '50s, '60s, and '70s. And I mentioned this in my paper. Going back on the history of the market. And I cover the grading companies as being a big influence as to why the market's increased.

Yeah, I mean, I think that's a really important point, the long history of the hobby, because there are people who might be skeptical, say, ah, you know, is this another Beanie Babies flash in a pan? What is this? And, you know, again, to your point, this is a very, very long history, and it's really come into its own lately in terms of dollar amounts and as well as data. There's just an explosion of data in terms of how they can examine the market and add transparency, liquidity, etc.

Exactly, exactly. You have, for example, the, you know, the superstars playing in the '50s and '60s, you know, the Aarons, the Mazers. They only had 4 uniforms, 4 jerseys each year to play with. They had 2 home and 2 away. So they have 2 gray and 2 white uniforms, and they would be listed on the tail of the shirt. Set 1 and the year of 1964, for example. And so you only had 4 jerseys that you could have bought and that player for that particular year. And so if you can buy something like a superstar of that caliber, like a Mays, Mantle, Aaron, DiMaggio, Williams, and of course Ruth and Garrick and those younger, you know, older players, if you can buy a uniform, it's almost no matter what you pay, you're going to make money. I mean, I think they're vastly undervalued in my opinion.

And is that mainly for who you're talking about, like the tier 1 stars, or even like, I don't know, a Hall of Famer like Lou Brock or Luke Appling or someone who's not? Would that hold for all, or is it mainly to the top tier?

No, I think you have obviously tier 1, tier 2, things like that. I mean, tier 1, I would also throw in like a Clemente or Jackie Robinson, obviously. But then you've got a tier 2, maybe like a Frank Robinson, Brooke Robinson, Carl Yastrzemski, you know, that type. And I think they'll hold their value and they're not going to cost as much on, on those players as the tier 1 players would. But almost, almost no matter what you pay, you're not going to get hurt. Obviously, if you can buy a year that's a significant year in that player's history, or if it was a signed item as well, it helps. Or if it's tagged to, you know, during that year he hit his 500th home run or whatever. I mean, And they can go back and there's companies that authenticate from a photo standpoint and try to get, you know, photo match the, the player's uniform or bat or whatever to that particular game. They do a lot of that nowadays with the newer players.

Right. I guess the proving provenance and whatnot is a lot easier nowadays. Cameras everywhere, everything's documented, filmed, etc. Correct. Yeah. So unfortunately, I'm looking at the clock and We're kind of close to running out of time, but before we go, help the listener figure out, I mean, how do they even approach this? I mean, everyone has a different shopping budget, right? There's literally millions of options in terms of cards, memorabilia. You've pointed the way directionally and quite specifically, but in terms of budget, and let's say, make a distinction between the collector and the investor, and what's the mind frame, you know, the game plan, so to speak, that they should embrace?

I think if they're a collector, I would always say buy what you like or what you love if you want to buy it to keep it and you're not thinking about making a profit. So if you have a special team or a player, you want to buy something of theirs. Obviously, the more money you spend, you know, the better item you may be able to get. As far as investors go, I would always advocate buying the most expensive item you can afford and then the highest grade possible. If it's a card, you want to go for the higher grade. Obviously a 10 is great. You know, 9s are very good, so are 8s, especially in vintage material. As far as memorabilia goes, if it's a signed ball or bat or even a uniform, obviously buy the best you can possibly buy and hopefully it'll increase in value. There's a lot of balls out there. Balls were signed by many players in the tens of thousands. So some of them are not as good signatures. The signature itself may not be as crisp as others, but the uniforms and the memorabilia and things like that, there's just a limited supply of those things out there on the market.

Okay, great. By the time you hear this podcast, or perhaps soon after, we're going to have a transcript on our website on Barron's Advisor, and we're going to have a link to Howard's white paper where you could read everything about it. It's quite detailed and interesting. But in the interim, how, how could people reach you, Howard, if they want to get in touch?

Well, if they'd like to reach me, they can email me, and my email address is hepstein, and that's E-P-S-T-E-I-N, and then the number 710@gmail.com.

All right, excellent. Well, thank you very much. My guest has been Howard Epstein. Thank you so much for joining us, and thank you for listening. I'm Greg Bartalus, and I can be reached at greg.bartalus@barons.com. You've been listening to The Way Forward. Please subscribe and check out all our podcasts at barons.com/podcasts.

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