I recently approached a seller on Instagram about buying a PSA 10 2007 Topps Kevin Durant #2. He had a few of them, listed at $550 each. I was able to negotiate two for $1000, but then told him to give me a minute to further consider the deal. That “minute” led me to a new approach in buying cards and grading.
In that “minute” I looked up Ebay Solds of raw Durants. They were selling in the range of $40 to $50 each. I found a few lots up for auction. I immediately thought to myself: why pay $1000 for two PSA 10s when I can spend roughly the same hobby funds buying 20 raw Durants and grading them myself? I was sure I could earn at least two 10s in the process, maybe a few more. Needless to say, I didn’t take the deal.
Over the next 7 to 10 days I was aggressive with my bids and grabbed two 10-card lots for $1000 total after tax and shipping, or $50 per raw card. At $50 per, this card was an 11x (“ex”) opportunity – 11x being the value ratio, PSA 10 vs. raw. $550 for a PSA 10 divided by $50 raw, there’s your 11x. The higher the ratio, the better the risk/reward. I would target at least 10x and you can find many higher ratios. Dirk Nowitzki is presently a 40x ratio! Plus he’s a lock for the Hall of Fame – a great opportunity to apply this strategy, and one that I jumped on. The low PSA 10 Pop and the fact that the card is 20+ years old will make it difficult to pull many (if any!) 10s, but if I hit only a few, I’m winning, as I will illustrate with the Durant lot. In general, the older the card, the lower your percentage of PSA 10s will be. If you find newer cards for this strategy, you’re more likely to have better grading results.
Back to those Durants. I decided to grade 19 of the 20 raw cards at PSA’s Economy Service level. $20 per card, 45-day turnaround. The one Durant I didn’t sub had a crease. I returned it to the seller who refunded me $50. That put my revised total for the raw cards at $950. Grading 19 cards cost $400, which includes shipping and insurance. Grand total for 19 Durants plus grading: $1350. That’s my cost basis, or outlay.
I don’t have the grades at the time of this writing so this is all hypothetical, but my goal is to beat the deal I walked away from – two PSA 10 Durants for $1000. Here are modest grading projections for my 19-card submission, based on the condition and close inspection of the cards purchased: 3x PSA 10, 10x PSA 9, 6x PSA 8.
When I identified Durant as a buy, I did so with the belief that he was undervalued and would go up in the near future, most notably, when he makes his return to the court. But the jump in Durant’s value came much sooner than expected.
Two weeks after I subbed my Durant lot, Gary Vee dropped a PSA 10 Kevin Durant bomb on his Instagram page.
Prices for this card have skyrocketed. They were hovering below $500 before Gary Vee’s post – they’re now at $800+, a substantial increase! PSA 9s are selling around $300, with 8s at $75 per.
My outlay again: $1350. Expected graded return value based on the recent sale prices cited above: $5,850 total. Subtract 15% for selling and shipping fees and I’m at $4,975, a $3,625 return on my outlay, after full recoup, assuming I sell all. Let’s assume I keep one PSA 10 and one PSA 9. Still leaves 17 cards valued at $4,750. Subtract 15% for fees and shipping and that’s $4,000 in value, a $2,650 return on investment, PLUS I walk away with two high-grade KD rookies.
Figuring out the graded vs. raw ratio on the 2007 Durant, calculating the risk/reward, and subsequently walking away from that initial deal – assuming my grade projections aren’t too far off – was well worth it. In doing so, I not only found an economical path to ownership of this player’s card, I discovered a new hobby investment strategy. Find a card you believe in with a solid graded vs. raw ratio. Buy lots. Submit for grading. Get the card you want AND make a substantial profit in the process.