Instead of investing in stocks or bonds, considering collectible toys could be a more valuable return on investment, according to a new study.
Researchers in Russia published an analysis who discovered that LEGO toys outperformed traditional large stocks, bonds and even gold. Their study found that the supply of iconic toys like LEGO declines over time, and their high collectible value can generate high returns in the secondary seller market.
In a sampling period between 1987 and 2015, researchers found that LEGO investments averaged at least 10-11% per year, which is a faster and higher rate of return than stocks, bonds, gold and many other collectibles like stamps or wines. .
“LEGO investors generate high returns by reselling unpacked sets, especially rare sets, which were produced in limited editions or a long time ago. The sets produced 20-30 years ago make LEGO fans nostalgic, and the prices for them are skyrocketing, ”Victoria Dobrynskaya, one of the study’s authors, said in a press release
Many people can assume that only certain collectibles are good investments. A Barclays survey, a wealth management company, found that about 10% of the wealthy invest their wealth in jewelry, works of art, antiques, vintage wines and cars.
The ROI of these traditional items is much more well researched, which Dobrynskaya says is different from unusual products like LEGOs, which may appear less serious.
Dobrynskaya and his co-authors analyzed the prices of 2,322 LEGO sets from 1987 to 2015 and found that aftermarket prices for these sets ranged from -50% to over 600% per year. The value of small and very large LEGO sets has increased faster than the prices of medium-sized sets, which Dobrynskaya says is likely due to the fact that small sets contain unique parts and minifigures, while large sets are produced in smaller quantities and are more attractive to adults.
In his research, Dobrynskay also points out that once a LEGO box is opened the supply of that particular set decreases and eventually the set becomes more scarce, collectors are looking for it and the price inevitably goes up.
A unique feature of toys like LEGOS is that sets are often withdrawn and based on specific, often iconic themes. For example, the Dobrynskay article mentions the LEGO minifigure, Mr. Gold, released in 2013 for $ 2.99. It is considered highly desirable for collectors and is offered in the secondary sellers market for around $ 2,000 today.
Barbie dolls, Beanie Babies, and superhero figures are also similar to LEGO in their ability to create a high return on investment in the aftermarket, due to their limited supply and rarity.
LEGO is particularly unique, as it is a toy company that has been around for almost 90 years and is considered the largest producer of toys in the world. According to Dobrynskay’s research, the LEGO factory in Denmark produces 2.2 million toy bricks per hour, and the number of LEGO bricks made each year is five times the current world population.
LEGO is not just a toy for children, thousands of adults around the world collect the toy, which adds to LEGO’s ability to retain its value.
However, Dobrynskaya said that not all LEGO sets are equally successful and true LEGO fans can sort through the nuances of the market and see the potential for investment in a particular set.
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