Collecting Pokemon cards no longer child's play as investment returns surge

Adding them to your portfolio can help balance out more traditional investments like stocks and bonds

Mark Shininger, a Pokemon card collector in Wisconsin, US. Several factors determine the value of Pokemon cards, making some far more valuable than others. Bloomberg

With the recent surge in Pokemon card prices, collecting has transformed from a childhood pastime into a significant market for collectors and investors.

Historically, Pokemon cards were primarily seen as toys or game pieces.

However, rare cards like the 1st Edition Charizard or Pikachu Illustrator card have sold for hundreds of thousands of dollars at auctions, underscoring a growing recognition of Pokemon cards as valuable collectibles similar to fine art or rare coins.

For instance, in 2020, a mint condition Charizard card sold for more than $300,000, attracting interest from traditional collectors, celebrities and investors.

The Guinness world record for the “most expensive Pokemon trading card sold at a private sale” was set in Dubai last year, with a Pikachu PSA 10 Illustrator card sold for $5,275,000 to YouTuber Logan Paul.

Diversifying your investments is a key strategy, and adding Pokemon cards might help balance out more traditional investments like stocks and bonds.

During the uncertainties of the Covid-19 pandemic, demand for rare Pokemon cards went up, suggesting they could offer some protection when other investments are struggling. But it's important to be cautious.

The value of the cards can fluctuate significantly and is often influenced by trends in the collecting world.

It's important to do thorough research and consult experts in collectibles before investing heavily in Pokemon cards.

As with any investment, there are risks and potential investors should consider these carefully against their financial goals and risk tolerance.

The sustainability of the current hype around Pokemon cards is uncertain. The recent surge in prices might be driven by nostalgia and social media, leading to temporary spikes in demand.

Historically, markets like those for comic books have experienced similar trends where initial excitement was followed by a decline in value.

On the other hand, Pokemon has maintained a strong and growing fan base for more than 25 years, which could suggest a more stable interest.

The brand's strategic releases and collaborations, as well as the continuing popularity of its games and media, contribute to continued demand.

Several factors determine the value of Pokemon cards, making some far more valuable than others.

First and foremost is rarity. Cards that were printed in limited numbers or were part of special events tend to be much more sought after.

For example, the Pikachu Illustrator card is extremely rare and highly prized due to its unique history and limited distribution.

The condition of a card is another crucial factor. Cards that have been kept in pristine condition, free from damage or wear, are significantly more valuable.

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Collectors often seek out cards that have been professionally graded by companies like PSA or Beckett, which provide a reliable assessment of a card’s condition.

The age of the card also plays a significant role. Cards from the original 1999 base set, especially the 1st Edition ones, are highly valued because they represent the beginning of the Pokemon card phenomenon.

These cards have a nostalgic appeal and are often considered cornerstones of any serious collection.

The popularity of the Pokemon featured on the card can greatly influence its value as well. Iconic characters like Charizard, Pikachu and Mewtwo are favourites among collectors, and cards featuring them often fetch higher prices.

Current trends and the broader popularity of Pokemon as a brand can impact card values. When Pokemon media, such as new games or movies, captures the public’s attention, interest in the cards tends to increase.

This means that staying informed about the latest Pokemon developments can be beneficial for potential investors.

Additionally, they should consider regularly visiting pop culture stores to keep an eye out for the latest editions.

As with any investment, potential investors must weigh the risks and rewards, stay informed about market dynamics, and perhaps most importantly, maintain a genuine appreciation for the rich history and cultural significance of Pokemon cards.

Hassan Tamimi is the chief executive of The Little Things ME