Wizards sent me a message on Thursday night.
“Dear Jeremy Fuentes,
We’ve decided to take your thousands of dollars in cardboard investments and chuck them out the window. The rest will be thrown out by the end of summer.
Subsequently, we’ve also chosen to throw your credibility out the window as well. Good job telling everyone to invest in Ravnica Duals since ‘they’ll be good for Extended.’
Thank you for playing Magic. We appreciate your continued support.
WoTC and the DCI”
Really? No, not really. But that’s exactly the message I got when I read the new banned/restricted announcement. I’m sure by now you’ve read Luis’s and Zaiem’s articles regarding the subject. LSV’s provides a one-step forward look into the new Extended and Zaiem’s gives a pretty thorough breakdown of what Extended will be losing. If you haven’t already, I definitely suggest you give those a read.
My reaction to the announcement was probably the same as many others. Why? Why did they do it and why did they do it like this? There must have been a better way. In my opinion, they could have done it a better way. Mirrodin was set to rotate out anyway. According to the guidelines they set beforehand, this was given information. What they should have done was announce, in advance, that starting next year they would be changing the Extended rotation and along with Champions block (which would be due to rotate next year), the following other blocks would rotate out as well, x y and z, etc. This way, they give the dealers, the consumers and everyone in between a heads up. Instead, by dropping this bomb that immediately Ninth Edition, Champions and Ravnica would be rotating out and then Tenth Edition and Time Spiral by the end of summer, Wizards is effectively throwing the market into complete chaos.
I mention terms like investments and markets a lot. I can’t help but make correlations to financial markets. I’ve been putting a decent amount of money into Magic as opposed to stocks over the years for several reasons. First of all, I play Magic; you can’t “play” with stocks. They are investments that can actually appreciate while you are getting practical use from them. Secondly, Magic investments work on a system of rules. Certain cards would be legal for certain amounts of time, all of which are predictable based on the rules. This means that your investments are less vulnerable than stocks. You don’t have to worry as much about things you can’t predict. If you follow the tournament scene and keep up to date with articles, you’ll generally be in good shape. I guess not? It turns out that Magic investments are closer in risk to stocks than I thought.
It doesn’t make them bad choices, it just means you need to approach them much differently if you are going to treat them as investments. There are actions I could have taken to prevent such an announcement from affecting my portfolio (or collection) the way it did. The main thing you need to do with any portfolio is diversify. It takes a lot of work, but if you want to protect your investment and see it grow, it is absolutely necessary. What does this mean? In Magic, investing in something like Extended is more of a mid-long term investment. It has long, slow but predictable life cycle. Vintage is more of a long-term investment. Things like Moxes and Power appreciate extremely slowly over time, but they are also very safe. Standard is a short-term investment. It takes a lot of time to keep up with Standard investments, but can be very rewarding if you are diligent. You can protect your portfolio from the DCI hammer if you spread your eggs out between multiple baskets.
Standard is very volatile, but also presents a rapid, short term growth element to the portfolio. Just say for example you invested in two Tarmogoyfs last fall. They are still the same price now, so your investment is definitely safe. However, if you instead decided on one Tarmogoyf and two Jace, the Mind Sculptors, your investment would have grown significantly, largely due to the fact you diversified your portfolio into a format that has potential for rapid growth. Conversely, if you went in on one Tarmogoyf and a bunch of Ravnica dual lands, you’d be kinda screwed. I know it is a pretty narrow example, but the more places you hide your money, the less chance a single burglar has of stealing it all. I realize that managing a portfolio with Eternal, Extended and Standard portions is almost like managing three separate collections. In finance, many people just hire professionals to manage their portfolios, whether it be because they’re lazy or just don’t feel confident enough in themselves. We don’t have those kinds of people in the Magic world so if you want to do it, you’ll have to put in the work. It won’t be easy, but if you care about your money, it will be necessary.
My advice to “diversify yo bonds” isn’t meant to be a woulda, coulda, shoulda, but rather a lesson you can take from my personal mistakes. What else does this announcement mean for us moving forward? Well you obviously have two courses of action: keep your cards or sell your cards. Let’s explore the second option first.
If you choose to sell, it means that you feel that your cards won’t reach the same or higher value within a reasonable amount of time (enough time that would warrant you holding on to them). This is perfectly reasonable if you can get anything close to normal value for them. The problem is that announcements like this tend to induce firesales of the banned or restricted subjects (see: the Arcbound Ravager banning). When the market is flooded, prices drop. I’ve seen some auctions ending recently at reasonable prices, but some also at prices lower than what I would consider good. So there’s a risk if you just decide to throw your cards on eBay. Plus by now, it might be a little too late. The later you are, the more people have heard about it and the less you’ll get. You might be able to find a local store owner or even an online shop without an updated buylist, but again, the longer you wait the less luck you’ll have. Still, if you can salvage anything close to what the cards were worth, I would probably advise you to do that. A dollar in the pocket is worth more than $1.05 two years from now, and it’s not even certain you’ll be able to get that $1.05.
If you decide to keep your cards, I can only think of two reasons why it would be logical. One, you couldn’t sell them for high enough. They say you only lose money if you sell. This is true, but if there is no possible way you will ever recoup any value, you might as well sell right? Well, there is a possibility you might in this case. That brings us to the second reason. Many have speculated that this announcement sets up the new Super Extended format perfectly. Though this is true, several things would also have to happen for the newly rotated cards to return to glory. First of all, the format would need to become a PTQ format or gain some other form of consistent, high level tournament play (e.g., The Legacy $5k series). There needs to be demand for these cards again. The problem is that there are only so many Pro Tours with only so many PTQ seasons. They already bumped off Block PTQ season to make room for the Standard PTQs. Between Standard, Extended and Limited, what else is left? Adding another Pro Tour could solve that problem, but that is already two steps ahead of where we are now. That’s where we’re going anyway though, isn’t it? I would 100% agree except for one problem. Why didn’t they announce the new format at the same time they announced the effective end of the old one? Even if they are going to bring this new format into the fold, I have a huge problem with the timing of it all.
They will probably announce Over-extended soon, but they didn’t yet. By not doing so, they’re leaving everyone in a state of limbo. On the night of the announcement I spoke with several friends about what they thought and what they would be doing in response. My friend Andy said it was ironic that they announced they would preserve the reserve list, but then just turn around and announce this. “The whole thing about the reserve list was that they wanted to protect collectors and dealers by letting them know that when Wizards makes a promise, they keep it. So it’s funny to just drop an announcement that will cost (dealers) a whole ton of money.”
It’s true that there are also many cards that will be leaving the format that are viable in Legacy and Vintage. But will those formats be enough to help those cards maintain their value? It’s really hard to say. And if this new Overextended format comes, what cards will be banned or restricted? Will it take over the current Legacy scene and leave those old decks in the dust? So many unanswered questions that remain unanswerable until we hear more.
Any sort of belief I had that Wizards takes care of its customers is in the same trash where they threw my collection. But I don’t want to use this article to rant or gripe. I want to help the you not make the same mistakes in the future and also help advise you on what to do going forward. If you continue to invest in MTG, be sure that you diversify and keep up with the market. Next thing you know they’ll be reprinting power. They say one thing, but you know how that goes. If you sell or are planning on selling, I don’t doubt that you’ll be able to re-buy your cards once the new format is announced for the same if not better price. If you choose to hold, I wish you good luck and hope that it ends up paying off in the end. If you have any other questions regarding this subject, I’ll happily field them in the comment section.
Thank me for playing Magic? You appreciate my continued support? We’ll see about that.