THE HISTORY OF SPORTS CARDS - FROM BUBBLE GUM TO JUNK WAX, PARALLELS & EVERYTHING IN BETWEEN

History of sports cards

Though there’s been renewed interest in sports cards over the past few years, cards have a long and storied history that spans more than 150 years. These collectibles originated in the 19th century, when cigarette and candy companies started including baseball cards with their products in order to drive sales by capitalizing on the sport’s popularity. While it is often said that there are two eras of sports cards - vintage and modern - there are really five distinct eras with important differences and unique characteristics. The cutoff dates are not exact, but when looking at a specific card it is important to understand the approximate era it comes from.

Pre-World War II vintage (before 1941) -

As baseball was the dominant sport in the U.S. for the bulk of the 20th century, baseball cards make up nearly all pre-WWII cards. These cards were less for collectors than they were methods of advertising the issuing company - such as the American Tobacco Company that issued the famous T206 series in 1909 - and often acted as protection for the cigarettes or gum, naturally leaving the cards in poor condition.

Additionally, prior to the early 1930s, there simply were not that many cards made as complete sets were not produced every year. Therefore, it is unusual to find cards from the early part of the century, and even harder to find them in good condition, so even poorly graded issues can be relatively valuable.

In the early 1930s, a production boom occurred, with the famous 1933 Goudey set leading the way, with a relatively high number of cards in good condition nearly ninety years later. For example, 12.4% of 1933 Goudey’s grade as a PSA 7 or better as opposed to 4.0% of 1909-11 T206s. 

 Post-World War II vintage (1945-1979)  

After the war, the Leaf Candy Company, Bowman Gum Company and Topps Gum Company got into the sports card business, leading to a golden era of cards in the 1950s. By the mid-1950s Topps was the dominant force and the most iconic cards from the era are Topps baseball cards.

This was when the Baby Boomer generation started collecting cards, as our parents and grandparents are so eager to retell us, and this nostalgia still drives a lot of the high-end market today. Stories abound of kids putting cards in their bicycle spokes or having their parents throw out what could have been a million dollar collection.

Because there was not an emphasis on keeping cards in good condition or any idea that they might be valuable in the future, there is a natural scarcity of cards in mint condition. This is also when you start to see more sports emerge with trading cards issued - for example, in 1948 Bowman released the first official basketball set - but baseball cards still make up a large majority of the notable cards from this era.

Junk Wax Era (1980-1996) 

By the time the 1980s rolled around and the Boomers were adults with disposable incomes, certain cards from their childhood started to become incredibly valuable, which led to tremendous growth in the industry. More card companies, including Fleer, Donruss, Score and Upper Deck - entered the space and met increased demand with overproduction. Additionally, collectors now knew to keep cards in top condition and store them away for the future.

As a result, very few cards from this era are valuable, and in most cases it’s only the ones in absolutely perfect condition that fetch high prices. There were simply too many produced and too many that still exist in excellent condition. So many people who grew up in the junk wax era still have their collections somewhere in a storage unit or at their parents’ house hoping that one day it will be valuable. 

Modern Era (1997-2012) 
As a result of the junk wax era, interest in the hobby declined and a lot of Gen Xers and Millennials stopped buying sports cards. We entered into a “Trading Card Winter” so to speak. Starting in 1997, companies responded by introducing “insert” cards with limited print runs, and eventually those cards - often with autographs and/or game-used memorabilia - became highly sought after. While vintage cards have a natural scarcity due to the lack of cards from those eras surviving in good condition, inserts offer an artificial scarcity because of their limited print runs.
This drove demand for the rarest cards, some of which are now among the most valuable sports cards overall. It’s also during this era that basketball cards became the most sought after as baseball cards fell in stature, riding the growing popularity of the NBA and a relative decline in baseball fandom.

Parallels Era (2013-present) 

That leads us to today, where basically the only cards worth pursuing are inserts and parallels (cards that are similar to base cards but with a different color or different design), with entire sets and boxes made up entirely of limited print runs, autographs and patch cards. For example, a box of 2020-21 Panini National Treasures Basketball Cards has 10 cards in the entire box and retails for $5,000 or more. In that box are 4 autograph cards, 4 memorabilia cards, 1 printing plate card and 1 base or base parallel card.

There are now so many parallels and subsets and slight variations of cards that it is often difficult to narrow down the best rookie cards for certain players. Rising star quarterback Justin Herbert has so many that there’s a guide to the top-70!

While the rarest 1 of 1 cards and prestigious rookie patch autograph cards can still command extremely high prices, there are some who believe this is the new junk wax era - an overabundance of “rare” cards means that no cards are actually rare. Additionally, because the players from this era are still active and playing, there is a lot of price fluctuation based on current player and team performance and cards from this era are certainly the most speculative.

Historical performance of sports cards

Historically, sports cards, particularly the blue-chip ones, have represented an excellent investment. The PWCC 100 Index, a rolling list of the top-100 cards in the industry, has outperformed the S&P 500 significantly over the past five years as of December 30, 2021. Since 2008, even the cards ranked 101-2500 have seen a 272% gain versus the 230% gain the S&P 500 has seen. As you can see in the graph below, a lot of the gains have come in the last year with the sports card market starting to gain separation from the S&P in 2015. 

 

 

CardLadder’s Indices are also a valuable source of macro data, broken down by sport and price point, with their CL50 a measure of blue-chip cards.

 

  

The CL50 index since 2004 shows steady growth with a spike right around the beginning of the pandemic, followed by a bigger spike last winter, followed by a correction.

Be aware that micro data for individual athletes and cards are just as, if not more, important than macro data for the industry and individual sports.

The sports card market

The sports card market is not a monolith and its movements as a whole do not necessarily dictate the movements of different sub-classes. Beyond the differences between modern and vintage discussed above, every sport moves in its own way, generally rising in demand and price during the season and falling in the off-season. Macro trends in popularity also affect price movements between sports, with basketball cards now leading the way. The international popularity of soccer combined with collecting’s growth globally could very well see another changing of the guard in coming years.

The market for high-end cards often moves differently from those with lower price points with higher end cards offering slightly more stability. Certain types of cards, usually those of younger athletes, are better for speculative flipping and certain cards, generally those of retired legends, are better for long-term holds. Over the past year, while there were wild price fluctuations amongst all sports cards, the more speculative assets generally saw wider swings than the more established assets.

There is also the market for “sealed” wax, meaning unopened packs and boxes, which often represent nothing more than a lottery ticket. The vast majority of the time when someone “breaks” a box, the cards found within are much less valuable than the unopened box. But the thrill of possibility keeps people coming back. It’s like a slot machine for cards.

Finally, there is the market for “raw” ungraded cards, which for a while was a steady source of income for many dealers. They would buy the raw cards, submit them for grading and immediately sell for a profit as graded cards become much more valuable given the third party stamp of approval. This strategy becoming more commonplace and the explosion in interest in the market as a whole led to massive backlogs and price increases at grading companies. Generally the strategy is no longer as viable, but a collector with a keen eye can still take advantage of opportunities.

Which sports cards are the most valuable?

As with most asset classes, the main value driver for sports cards is scarcity, with difficult to find vintage cards, highly graded modern cards and limited print run cards at the top of the list. Rookie cards are always going to be the most valuable card for a certain athlete, and for modern cards, the rookie patch auto (RPA; a signed rookie card with an equipment patch, usually a cutout of a player-worn jersey) cards take the crown.

Of course, cards of the best players tend to be the most valuable, but more than that, it’s players who have maintained a cultural following during and after their careers that become the most desirable. Ted Williams was a better player than Mickey Mantle, but Mantle’s cards are more valuable. Tim Duncan was every bit as good as Kobe Bryant, but Kobe’s cards are more valuable.

Here’s a list of the highest sales in every major sport as of now - all of which happened in 2021:

Baseball: 1909 T206 Honus Wagner SGC 3 - $6.6 million

Basketball: 2003-04 LeBron James Exquisite RPA /23 BGS 9.5 - $5.2 million

Football: 2017 Patrick Mahomes Panini National Treasures Logoman 1/1 - $4.3 million

Hockey: 1979 Wayne Gretzky O-Pee-Chee PSA 10 - $3.75 million

Soccer: 1958 Alifabolaget Pele PSA 9 - $900,000 

Why should you invest in sports cards?

Like with a lot of collectibles, sports cards saw an explosion in interest during the early days of the pandemic, resulting in significant price increases that peaked in late 2020 and early 2021. While prices dipped in the summer months, they have rebounded recently as auction houses continue to see record volume and media interest remains high with all of the record sales that took place in 2021. EBay sold more cards in the first half of 2021 than it did in 2020. Card show attendance boomed in 2021, with over 100,000 attendees at the National Sports Collectors Convention in Chicago with nearly half being first-timers. Anecdotal evidence abounds of younger collectors flooding shows across the country.

While 2022 may not match the highs of 2021, expect more record-breaking sales and a rise in interest as sports card collecting continues to become more mainstream. The acquisition of card giant Topps by Fanatics for $500 million signals growing optimism that the card boom is here to stay and not just a passing fad. Additionally, the company Verified Market Research projects the global sports card market to grow at a CAGR of 23% through 2027.

Sports cards represent a way to invest in player performance on a more long-term basis than sports betting does. Sports fans who believe that certain young players will become all-time greats can see the value of their portfolio rise with the fortunes of their favorite athletes. Imagine investing in LeBron James cards at the beginning of his career, or Shohei Ohtani cards before the 2021 season. As with a lot of the other asset classes that have seen huge gains in the past year, sports cards are simply more enjoyable to invest in than traditional asset classes. As interest grows globally through sports like soccer and basketball, the market will only grow with it.

What should you look for when investing in sports cards?

When you look at a card, the basic components are the year it’s from, the athlete or athletes pictured, the company that manufactured it, the number of the card if it’s a limited print run and any special characteristics like an autograph or a piece of equipment. If it’s been graded, you see what company graded it and what the grade is. But within each of these basic categories there are important distinctions.

The year it’s from is important because you can determine what era it fits into and it also helps you determine whether it’s a rookie card for the athlete. It’s obvious why the athlete matters, but there are cards, usually inserts or parallels that do feature multiple athletes and those cards are almost always less valuable than those with just a single athlete. A LeBron card or a Jordan card is generally more coveted than a card with both LeBron and Jordan. This is particularly true when the secondary athletes are not as desirable as the main athlete.

Certain brands of cards and certain sets within those brands are worth more, something that depends on what year the card is from, but for modern cards, it’s usually because of how expensive those packs and boxes were when originally sold. For example, for modern basketball and football, Panini National Treasures is the standard bearer and for modern baseball it’s Bowman Chrome.

For numbered cards in a limited print run, if the number corresponds to the player’s jersey number, particularly if it’s an iconic number (Jordan’s 23, Kobe’s 8), that card is more valuable. For example, the 2003-4 Exquisite LeBron James RPA numbered 23 of 99 sold for $2.46 million just weeks after a different one in the same grade without the jersey number sold for $1.3 million.

With autographs, the quality of the autograph is important so look at the clarity of the signature and whether it’s been smudged in any way (there is sometimes an autograph grade for a card as well). The autograph being straight on the card is much more desirable than if it’s on a sticker that is then affixed to a card because with an on-card autograph you know the athlete actually handled that card.

 

 

For equipment, usually it’s game-used by the athlete on the card, but sometimes it’s only just player-worn from a photo shoot and sometimes it’s neither, just a patch from a common jersey. Game-used is the most valuable, naturally. Also important is the quality of the patch which is usually determined by the number of colors shown - the more the better. The most valuable patches are unique, such as the NFL shield or the NBA logoman seen below.

 

 

 

Grading

If the card is raw (ungraded), the important factors are the centering, corners, edges, color and surface of the card, with centering usually the most important for eye appeal. If the card is graded, it’s important what company did the grading - the three major ones are Professional Sports Authenticator (PSA), Beckett Grading Services (BGS) and Sportscard Guaranty Corporation (SGC). While the factors above are still what the companies look at when grading, all three have slightly different scales and different standards - here are PSA’s, BGS’s and SGC’s.

Generally PSA is the most coveted by collectors, followed by BGS, followed by SGC. For example, a PSA 9 is generally better than a BGS 9 or SGC 9. However, because BGS gives half grades, they rarely give perfect 10s so BGS 10s are better than PSA 10s or SGC 10s. BGS also provides subgrades for centering, corners, edges and surface to get to an overall grade with a card receiving a perfect ten in all subcategories receiving the rare and highly coveted “black label”. All three companies also offer the option to grade the autograph on signed cards but it is not compulsory.

Keep in mind the grades are subjective and based on the opinions of a single grader within a company, so there are variations within grades - not all PSA 10s are created equal. Many collectors will "crack a slab" - meaning to open the plastic case a graded card is held within - and resubmit either to the same agency or a different one in hopes of getting a higher regrade.

How do you price sports cards?

As with most collectibles, the best way to determine market value for sports cards is by looking at comparable sales. Nearly all the major auction houses allow you to search through their past results:

Goldin, Heritage, PWCC, Lelands, Robert Edwards, Mile High, Memory Lane, SCP, Grey Flannel

EBay also has sales going back a few months but unfortunately it's harder to track down full results from there and the data can be less reliable, as there’s no way to track whether a sale was actually finalized.

There are several third-party sites that report sales data, most notably Cardladder, which was just bought by PSA, which also collects auction data on cards it has graded. Other sites include OnlyAlt (which is also a marketplace and holds auctions), Vintagecardprices and Sports Card Investor. Be aware that none of these sites has complete and accurate pricing and sales data on its own as there are so many different cards and sales that it’s easy for there to be gaps in the data. When doing your own research, be sure to double and triple check the data, ideally at the primary sources (auction houses) if something feels off.

It is also crucial to check the population reports of the three major grading companies - PSA, BGS and SGC. It is always important to know how many of a given card exist at every grade when evaluating how much a specific card is worth. Be sure to check all three companies - it’s easy to be fooled by a listing hyping a BGS 9.5 as the highest grade in a pop report when several PSA 10s or SGC 10s may also exist.

 

Often, particularly for vintage cards or parallels, there aren’t any recent sales to use as comps, and so the valuation will not be as precise. You should first look at trends in different grades since the last sale of the given grade. For example, if you are evaluating a PSA 10 and there hasn’t been a sale in the last year, look at how the PSA 9s have performed in that time period. If there are no cards of any grade as a comp, you can check other notable cards of that athlete to see how they have performed in that time period. This is not always going to be determinative but it does give you an idea of investor demand for that particular athlete and card. 

You can also look to sales of lower grades or more common parallels to try and extrapolate valuations. It can be quite difficult though, as sometimes the multiplier between different grades can be 1.5x or 2x, and sometimes it can be 50x depending on the pop report. The difference between a /5 parallel and a /25 parallel might be 2x or 10x. Many times cards of the same grade will sell for different amounts because of a difference in eye appeal. It is always best to get as much data on whatever specific card you are pricing rather than try to rely on overall rules of thumb. 

Ultimately, understand that there are no hard and fast rules and so much of what determines a card’s value is specific to that individual card - the sport, the year, the set, the athlete, the grade, the eye appeal - there are so many factors that go into it. There is no substitute for experience and the more cards you see and evaluate and the more sales data you read, the more comfortable you will be in pricing cards. 

What are the risks when investing in sports cards?

Rising population reports

There are different risks for the different classes of sports cards and a couple that apply universally. First, with the recent explosion in interest in cards as investments came an explosion in submissions to grading companies, causing PSA and BGS to both pause their services, which caused a ripple effect throughout the industry. Now, with both companies working through their backlog, the population reports are going to change immensely, with a lot of cards becoming more common than previously expected. This shouldn’t affect numbered parallels or vintage cards as much, but for modern cards, we are already seeing some ridiculous numbers – there are now 20,371 PSA 10s of the 2019 Zion Williamson Panini Prizm and 16,216 more PSA 9s, for example.

Active player risk

For any cards of athletes still playing, there is always the attendant performance and injury risk. For younger players (think Luka Doncic or Joe Burrow), this is a bigger risk than for established greats (LeBron James or Tom Brady) who have a much higher floor because of their existing accomplishments. If a young athlete with high potential does not pan out, the value of their cards will plummet. If they or their team have a poor season, the prices will drop in the short-term. For modern players, so much of the value is tied to how fans are currently feeling about them and that is almost entirely tied to whether they are doing well and whether their team is winning.

Cultural relevance changes

For vintage cards, except for the absolute legends of a given sport, there is the risk that the player will lose cultural relevance going forward. This is not a risk for Michael Jordan cards, but it may be a risk for Wilt Chamberlain cards. The icons for older generations may not hold their value as well as those who remain icons for younger generations. The same can be said for overall sports - the ones more popular amongst younger generations are going to hold their value and provide less risk than those who have seen their popularity decrease. Modern baseball cards have generally struggled as the sport has seen a decline in interest from Gen Z, whereas soccer cards have been on the rise as the global collecting market grows.

Declining scarcity

Finally, every time sports cards have seen increases in popularity, card companies have responded by overproducing items and flooding the market with supply, causing prices to go down. 

As mentioned above, there are now so many parallel and insert cards that even the “top” cards have become less scarce. Also consider that nearly all collectors know now to preserve the cards so the vast majority of cards get high grades which dilutes the value of highly graded cards.

With these factors, it is easy to envision a future where even PSA 10 rookie cards of top players produced now will be so common that they barely have any value.

See below for data from GemRate that shows the majority of modern cards receive top grades:

 

Where can you buy sports cards?

Now, more than ever, there is easy access to the sports card market with new marketplaces opening all the time. Of course, the granddaddy of them all is EBay, which has an incredible amount of listings across all sports and all price ranges. You can also buy from the auction sites listed above - PWCC now has its own marketplace as well. A few of the newer marketplaces include MySlabs, Alt, StockX and StarStock.

Always be careful of buying any card at “sticker price” as it is almost always going to be above the market value. Always negotiate with the seller if possible or bid at auction (though remember that auction houses charge a “buyer’s premium” of around 20% on top of any bid).

Fractional platforms such as Collectable, Dibbs, Otis and Rally have allowed investors to buy shares in blue-chip six- and seven-figure cards. Each features secondary markets where you can buy and sell shares. There are also options on social media, with Facebook trading groups and people offering cards for sale on Instagram, Twitter and even YouTube. When dealing with individuals it is imperative to do your due diligence to make sure a seller is legitimate and the product they are selling is legitimate. It’s much safer to go through a verified site that has buyer protections.

And of course, there are the analog, real life options with card shops resurfacing in most cities and card shows seeing record attendance - here’s a list of major card shows in 2022, but there are also lots of smaller, regional shows. Big-box retail stores like Wal-Mart and Target often carry packs and boxes of cards as well. When buying a card, also consider insurance and shipping options to make sure you are covered if something goes wrong. Also think about potential storage options for high-end cards whether it’s a third-party vault (PWCC, Goldin and Alt all have vaults amongst others) or a safe deposit box. 

How to get started investing in sports cards?

  • Decide how much of your portfolio you want to allocate to sports cards, and how much of that you want to put into short-term speculative investments and how much you want to put into long-term investments.
  • Explore the listings on Vincent and read in detail about the current sports card offerings.
  • Go to EBay and search for your favorite athletes - there will be an incredible amount of selection there.
  • Go to Alt, Dibbs, MySlabs and PWCC Marketplace to see what is available there.
  • Go to Otis, Rally Road and Collectable to see what sports cards are on their secondary market and are available for trading.
  • Sign up for accounts at auction sites to explore past and upcoming sales to see if there are any cards that interest you in your price range.
  • Go to message boards - Blowout Forums is the best - to join a community and learn more about the hobby.
  • Check social media (Twitter, Instagram, Facebook) to follow individuals and companies in the industry and join trading groups.
  • As always, do your own research.