Chart Chat: Q3 Sports Chart Pack
Now that Q3 has drawn to a close, it's time to investigate some burning questions. Which sport ruled the quarter? Which athletes put the fractional space on their back? Did memorabilia finally have its moment? Wait no more. Our answers are below.
Note: the figures below include only those assets that traded for the duration of the third quarter.
Let's address the sport literally bursting through the chart - we had to put a maximum limit on the Y axis or else the other data would be indistinguishable. That's how strong golf performance was this quarter, and it's really all owing to one asset: the Tiger Woods Tournament Used Putter on Collectable, which was up 483%, on par with some of Tiger's utterly dominant tournament performances in the early 2000s. That incredible outlier aside, it's interesting and intuitive to see that there's some clear seasonality at play here: baseball and football, both in the public eye for a good chunk or the entirety of the quarter, handily outperformed basketball and hockey, which were entering their respective offseasons.
Drilling down one level further, we examined the performance in each category by sport. Golf memorabilia was atmospheric, for obvious reasons. Basketball memorabilia, led by Wilt's uniforms, and boxing memorabilia both outperformed cards in their sports, while football and baseball memorabilia trailed. On the whole though, sports memorabilia outperformed cards this quarter for the second quarter in a row; Q2 was also a quarter of outperformance, albeit negative absolute performance, as the average ROI was -12% vs. -16% for cards, with cards absolutely cratering during the quarter. Still, since inception, the average ROI of sports cards is about 20% higher than that of sports memorabilia, so this quarter was merely a continued reversal of massive underperformance to date.
What's interesting is how little the two categories seem to correlate, particularly on a micro level. On a macro level, obviously, we know how their performance has dispersed to date, and that continued this quarter though the direction of movement was largely the same. It was around late August, however, that memorabilia hit another gear and created significant outperformance. It's particularly interesting to look at those athletes that have both cards and memorabilia trading to see if they mostly move in tandem. Looking at the examples below, the answer is sometimes yes, sometimes no, sometimes it's completely unintelligible. For the most part, the movement is directionally similar, but the magnitude varies dramatically, and since we're not talking about a huge quantity of assets yet, spikes in volatility can result in disjointed performance.
There were a few notable cases where an athlete's memorabilia outperformed his cards - Tiger, Koufax, Jordan, and somewhat surprisingly, Mookie Betts. Koufax and Betts aside, baseball cards handily outperformed memorabilia for most players, particularly in light of the strong recovery in vintage baseball this quarter. Sadly, the weight of Andre the Giant's jockstrap has simply been too much for fractional investors to bear, though the asset did recover off of lows to end September. Investors have chosen instead to articulate their appreciation for the mythological superstar via his WrestleMania card basket with Hulk Hogan. Understandable.
In baseball, strong performance was fairly widespread, across both modern and vintage players. Strength in memorabilia, however, won the day, as Sandy Koufax's game worn jersey propelled him to the top of the chart. Notably, both Corey Seager and Gleyber Torres were miserable performers in Q2, so their Q3 resurgence is a point of encouragement for buying the dip. The same cannot be said for the injured Ronald Acuna - but perhaps that creates opportunity for those who are post-injury believers.
Basketball performance is again led by a player with particularly strong memorabilia performance, as Wilt's uniforms had quite the quarter. Keep in mind, though, that his rookie uniform isn't included in these figures, having not traded the duration of Q3. So it instead reflects only the high school uniform, which rode happily in the rookie uniform's wake to returns approaching 200% (of course it's given back 34% so far this week). That's a really cool demonstration of the market reacting more broadly to an asset-specific catalyst: the buyout offer for Wilt's rookie uniform. The second best performer, George Mikan, is also the result of strong memorabilia performance, as his original Bowman photo rewarded shareholders in Q3 after inexplicably cratering towards the end of Q2. Just four players had negative performance: Dr. J, Stephen Curry, Kobe, and Kawhi. Leave it to the always electric Kawhi Leonard to be essentially flat. Guess he likes his fractional performance like Kyrie likes his earth (h/t Ted Lasso).
In football, fractional shareholders are circling the wagons with Bills quarterback Josh Allen, who has Buffalo off to a 3-1 start. The fractional world also welcomed the conclusion of Aaron Rodgers' holdout, while the GOAT continues to climb after a choppier spring. On the flip side, there appears to be a growing skepticism that Patrick Mahomes can attain the dizzying heights implied by some of his card valuations, and an unsteady start to the season has done little to reverse his softer market. Could that change when the internet once again collectively and simultaneously worships at the altar of a few no-look, sidearm passes? The internet is a powerful beast, and so is his arm, but careers are long, and so is the road to the Super Bowl. Time is on his side, but that creates both opportunity and risk.
Finally, in hockey, the Great One leads the way with his PSA 10 Topps rookie trading for the first time on Rally in September, though it gained just 20%. It will never cease to be staggering that the card is just pop 2.
Anybody that knows that the card is pop 2: Can you believe that Gretzky's PSA 10 rookies, both Topps and O-Pee-Chee, are pop 2?!
The Ovechkin card on Collectable was the beneficiary of a strong comp after challenged initial performance, while the Sidney Crosby basket continues to struggle, eh? Hockey returns to ESPN next week - a positive catalyst with more eyeballs on the sport, or more of the same?
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