Question on Time Frames for Selling

[tennispro160]

This has been an extremely informative site. I have decided to try my hand at investing in a few lego sets as it seems like a fun hobby to help fund a personal collection. I found LoTR Weathertop on clearance for $20 each at my local Walmart and bought a few. I also picked up a Hulk Breakout for $35. I bought a few others but these are the main ones I have a question about. At what point is it a good idea to sell? I realize no one may no the perfect time as sets go up and down, but I would like to hear your opinions. The average price listed on this site now for either of those sets are over $50 so I could already try to make a profit, but should I expect prices to rise more? Any advice would be a great help as I'm sure it would apply to other sets I may invest in as well. Thanks.

Sorry if this has been covered somewhere else already. I haven't found it yet if so.

[MartinP]

When I sell Lego sets, I generally wait till the set is retired. Some people wait 1-3 years after the set is retired to sell the set.  That is when the most profit is most likely to occur. So my recommendation is to wait at least till the set is retired to sell the set to make a profit. If you need the money for another investment sooner, you can sell it earlier and still make a nice profit.

[DoNotInsertIntoMouth]

Its tough - unfortunately investing is not the easiest thing in the world to do - takes a lot of work. And it is absolutely different for every set.

 

So first you have to settle on what you want out of a set and if it has the potential to get there. 

 

How I do it? I don't invest in a set unless I think I can double my money in 2 years or so. So that narrows things down. I also don't buy a set unless I get it at a price where I know I shouldn't lose money.

 

When do I sell? Well, basically when the major growth stops. Most of the time out of the gate sets grow quite a bit and then tail off. This is different for every set. Harry Potter is right on the end of that now. This is about the time to sell for it.

 

However, Imperial Shuttle is in the middle of its growth period.

 

Most of the time this is 2 years-ish - but not always - look at the 10179 Millenium Falcon - it just keeps growing.

 

SO the short answer is, decide what you want out of a set, but be ready to part with it when its growth stops (I categorize this as about 6 months or so without any gain). What is a good example of that?

 

Look at 6211 - barely up from a year ago Great set - but not an investment anymore even though its CAGR is very good.

[TheDarkness]

It all depends what sort of return you are looking at for your investment. Everyone has different benchmarks they want to sell at. Some will sell at 30%, others 50% and some not a penny under 100%, so it all depends on what you set out to achieve with your purchasing. Are you waiting until you think the set is pretty much as high as it will ever go? All depends on yourself and what your financial goals are.

[DoNotInsertIntoMouth]

Another big point is when you have a chance to invest in something better. 

 

Example: I bought about 12 5888's from TRU when they were having a pretty good sale because it is EOL. TRU is still selling them, but for too much. I banked on them going sold out and then climbing shotly after. Unfortunately 6 months later - still in stock. 

 

SO I am slowly selling them off, making about 10 bucks per or so. Not great at all - but I am freeing up the money to reinvest in something else.