At the end of last year we wrote an educational post highlighting some of the similarities between the sports card collectibles industry and stock market investing.  We wanted to see how well we’d do if we invested in some boxes of the newest baseball card product — 2023 Bowman Draft — featuring a rare Tom Brady autograph card and the rookie cards of Major League Baseball’s most recent batch of prospects.  As we noted in our prior post, opening packs of cards is the riskiest part of the sports card industry.  You simply don’t know which cards you’re going to pull, so your investment can quickly become close to worthless if you don’t pull any good cards, or you can hit it big by pulling a rare or highly sought-after card.  In the sports cards world, opening sealed packs is similar on the risk scale to buying stock options in financial markets that can quickly move sharply higher or go to zero.

So how’d we do in our recent box break?

Below are pictures of the various cards we pulled across the six boxes we opened.  All in all, of the 4,500 cards, we got 30 different autographed rookie cards along with dozens of “short-printed” parallel cards that are serial numbered.  These serial-numbered cards are more rare and thus more valuable than the non-numbered “singles” that fill up the majority of packs that we opened.

Our best pull was a Paul Skenes blue autographed rookie card serial-numbered out of 150 that was selling for roughly $450 on eBay at the end of December.  Skenes was the #1 overall pick last year by the Pittsburgh Pirates; a pitcher from LSU who is maybe most famous right now for dating LSU gymnast and NIL-celebrity Livvy Dunne.

After checking the most recent completed sale prices on eBay for all the cards we pulled, we found that the entirety of our collection was worth about 50% of our total purchase price of the six boxes.  Ugh.  We certainly didn’t find the rare Tom Brady that would have immediately doubled or tripled our initial investment!

From an investment standpoint, our experiment was not a success!  Down the road, there’s a chance that one of the autographed rookie cards we pulled will skyrocket in value.  After all, Mike Trout was a relative nobody when his rookie autographs first showed up in the 2009 version of the same product we opened.  The least rare of the Trout rookie autographs currently sells for five figures.  But the higher likelihood is that we’ll never make our initial purchase price back on these packs!

For any card collectors reading this that might see a card they’re interested in, feel free to reach out!

The S&P 500 has gotten off to a rocky start to the new year, but it hasn’t knocked down bullish sentiment yet. This week’s bullish sentiment reading from the American Association of Individual Investors (AAII) rose from 46.3% in the final week of 2023 up to 48.6% this week.  That edges bullish sentiment back towards the multi-year high of 52.9% put in place two weeks ago and still leaves bullish sentiment over a full standard deviation above its historical average.

As for bearish sentiment, things are not as extended, though at 23.5%, the share of bears is still several percentage points lower than the historical average (31%).

That means the bull-bear spread is also still historically in favor of bulls with a 25 percentage point gap between the two.

Including other weekly sentiment surveys, the picture is a bit more muddled albeit still showing a bias towards bullishness. For starters, after its holiday hiatus, the Investors Intelligence survey posted its highest reading on bullish sentiment since November 2021.  Conversely, this week’s reading in the NAAIM Exposure index tracking active managers’ equity exposure plummeted from a reading above 100 (meaning managers reported they were fully invested long) all the way down to 71. That is the lowest reading in the index since early November.

The S&P 500 is still within 2% of its record closing high reached exactly two years ago today, but beneath the surface, there have been some big moves.  The chart below shows a distribution of two-year returns for every S&P 500 stock that is currently in the index, and while there have been some big winners and losers over this period, the average component’s move has been just a modest decline of 0.54%.  So while the S&P 500 is down 1.9% from its high, over that same period, the ‘average’ stock in the index is down even less.  For all the talk over the last year about how narrow the market has been, over the last two years that hasn’t been the case.

In the tables below, we show the 25 best and worst-performing stocks in the S&P 500 over the last two years.  Starting with the winners, all of the stocks listed have rallied at least 63%, and there are another 14 stocks that are up over 50% that didn’t make the list. Perhaps what stands out most about the list of biggest winners is what stocks aren’t on it.  As shown, only three Technology sector stocks (and no Communication Services sector stocks) made the list, and of those three, not even one has a market cap of more than $30 billion.  The only mega-cap stock on the list is Eli Lilly (LLY), showing again how while mega-cap tech had a great 2023, on a ‘two-year stack,’ their performance has been unremarkable. While tech stocks weren’t well-represented on the list, Energy and Industrials filled the void with eight and six stocks, respectively.

Among the list of biggest losers over the last two years, 18 are down over 50% led lower by VF Corp (VFC) and Match Group (MTCH) which have both plummeted more than 70%. Both of these stocks now have market caps of less than $10 billion, and of the 25 names shown, only three (Paypal-PYPL, Estee Lauder-EL, and Pfizer-PFE) have market caps above $50 billion.