Archive for June, 2021

Your Money Goals

3 Factors which determine your investment strategy

You may be wondering what is the right investment strategy for you, but without knowing anything about you, any advice on which investments are right for you may in fact be the wrong ones. There are basically three factors that determine which are the right investments for you, they are:

1. Your age

2. Purpose for the money

3. Your risk profile

Starting with your age. It would be rather silly of you to invest all your money in growth funds if you are aged 65 because if the market takes a dive such as was the case during the 1987 sharemarket crash and to a lesser extent, the Global Financial Crisis during the early 2000s you have less time to recover from these setbacks whereas the young ones have time on their side.

The purpose for the money is the second factor.

Decide whether you require the money in the short-term, medium-term, or long-term.

Short-term would be up to a year.

Medium-term is 1-5 years

Long-term is longer than five years

Short term expenses would be, a bank account for emergencies, a holiday within a year, dental expenses, or t pay for the kids schooling for a year.

Medium-term would be savings for a car.

Long term would be your retirement fund, saving for a house deposit, or saving for the trip of a lifetime.

Your risk profile is a determining factor in where you invest your money. If the thought of the sharemarket taking a dive will give you sleepless nights then investing growth stocks in the sharemarket is not for you. A better option would be managed funds where you will be given a choice between growth, balanced, and conservative funds.

It is important not to get into debt for there is a cost to debt and that is interest. Interest adds to the cost of goods bought with borrowed money, and this adds up to a fortune during a lifetime of borrowing for consumables. This is called bad debt because the value of the item declines over time.

There is such a thing as good debt though and this is your first home because the value of the property increases during the lifetime of the loan but even this is not always a good option for some people if you live a kind of transient lifestyle.

“Everyone is to their own,” so only you know what makes you tick so your personal circumstances are the determining factors which govern where best to invest your savings.

You must do your homework before you invest in anything, whether that is the sharemarket, managed funds, or gold. There is so much information available on just about everything, and that includes finance. It is just a matter of learning the ropes and having a financial strategy which suits your personal circumstances.

PSA Shut Down for 90 Days – The Effect on the Sports Card Industry

On March 30th, 2021 PSA (Professional Sports Authenticator) announced they were temporarily suspending all their grading services below Super Express ($350 a card) for at least 90 days with the hope of reopening all services around July 1st, 2021. PSA received more cards in 3 days than they did in the previous 3 months which is what led to the backlog and ultimately the difficult decision of suspending new submissions for a couple months.

OK, so let’s look at the impact this may have in the short term. Long term should be negligible to the sports card industry as it looks like at this point in time since they intend on being back to servicing all PSA grading levels within 90 days.

1 – People I believe will step back and take note on inspecting each card and really enjoy the card look for what it is more rather than just looking for a graded card since they won’t be grading nearly as many cards as they were previously simply because of PSA’s postponement of services.

2 – With SGC (Sportscard Guaranty Company) at minimum of $75/card and BGS (Beckett Grading Services) at minimum of $100/card to get a card graded within 1 month or less we most likely aren’t going to see much of an increase in business since PSA still has Super Express service open at $350/card and their brand commands so much higher values in the open market.

3 – The suspension of PSA grading services leaves the opportunity for companies like HGA (Hybrid Grading) and CSG (Certified Sports Guaranty) to make up ground especially on the lower-end cards with values of $500 or less because of their low cost grading services. So far I believe it will be CSG that has the best chance at grabbing a good piece of the market share for value cards of $500 or less away from PSA at least in the short term while PSA’s value service is suspended. How much CSG retains in market share if PSA reinstates the value grading service at $25 is the unknown variable.

4 – In the short term, PSA 10 values should increase on all cards but especially should increase on lower end cards valued at $1k or less simply because you can’t grade with any sports card PSA at that value unless you wanted to utilize the Super Express service, but that wouldn’t make financial sense to do at $350 per card. I fully expect this will create more demand for those cards in the short term. However, in the long term many of the base level cards that are PSA 10 should return to normal values once/if PSA resumes their value service which is currently set at $25/card. The higher value cards of staples in every market (baseball, football, basketball, etc) should continue to rise though as there are less of those available in the marketplace which is the simple rule of supply and demand.