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MTGO Finance is…different. I would expect that many of my readers have heard this before, but I doubt that many understand just how different the MTGO marketplace is from paper MTG. I’m going to try and put some quantitative measures to give real context to the qualitative and oft repeated maxim of “MTGO is cheaper than paper.” Then, I’ll go over several aspects of MTGO finance, many unique to MTGO, and highlight my current spec choices as they fit into each category. Spoiler alert: I may have written a lot….I’m so sorry, this will be the only time it’s this long. Pinky promise.

About Me

But first, let’s talk about me. If you’ve read the other Battle of Tix articles, you may have noticed that each competitor has a different approach in pretty much every aspect: writing, organization, and speculation. I will be approaching Battle of Tix with two different goals in mind: 1) to teach and 2) to learn.

For the teaching, I plan to have many of my articles go over aspects or tools of MTGOFinance with updates on my #BoT specs weaved in or separated, however they best fit. These will generally be either info about MTGO specific trends/peculiarities or tools that can help you track prices and make decisions during speculation.

For the learning part, you first need to know about myself and MTGO speculation. As I said in my intro article, I’ve been dabbling in this for a bit over 2 years now with the goal to make a little bit of money (less noble than most people’s “play MTG cheaper”, but I have mouths to feed). In these endeavors I’ve been very risk-averse. Like, really, really risk averse. As in, my guiding principle in making a spec is simply “don’t lose money.” If one follows that, they are pretty guaranteed to make money, but only a limited amount, unfortunately. I, personally, need to learn to make more risky specs, as that will enhance my profits. The trick is to just make more good calls than bad. To give a concrete example, we can look at a fellow #BoT competitor’s specs from last week. Ryan (@CryppleCommand) made specs on:





Splinter Twin Splinter Twin





All Is Dust All Is Dust





Ulamog, the Ceaseless Hunger Ulamog, the Ceaseless Hunger





Narset Transcendent Narset Transcendent





Thought-Knot Seer Thought-Knot Seer





Reality Smasher Reality Smasher





Languish Languish

I personally wouldn’t have made any of these specs, because I didn’t see a very clear-cut reason for their increase (my risk-aversion, some might say ‘poor’, evaluations). And, indeed, he lost almost 10 tix with the Twin, All is Dust, Newlamog, and Narset specs. But, he more than made up for that loss with the gains of Thought-Knot Seer, Reality Smasher, and Languish (+18 tix). So, I while I would have avoided that risk, not bought any of those, and made $0; he made out with 8 tix. So, I’m hoping to come to terms with risk and being okay with making bad calls and losing some money, as long as I can balance that out with good calls that give me a net positive in the end. This also boils down to just doing more volume of speculation, as I currently like to just wait around for really good opportunities with low or no risk. Additionally, I’ve mostly kept to Modern specs, as they are more predictable and don’t have the volatility of standard cards…but they are also much less valuable, limiting the ability to turn a profit. Now, on to some meat!

Cards are Worth Less (Worthless) on MTGO

As I mentioned before, this is probably the phrase that is used to introduce someone to MTGO, as it’s quite the fundamental difference. First, let’s try to understand why and then we’ll get to some quantification to illustrate the disparity between MTGO and Paper prices.

Why is card X worth $Y? As always in economics, it’s ‘supply and demand’. In MTG, demand comes in many forms, but the main driver is the metagame. If a card is in a tournament viable deck, there will be high demand for it. If supply can’t keep up, the price will be high (see mythic rares). If there is enough supply, the price won’t be too high (see most rares). In paper MTG, demand can take many other forms:

Metagame (tournament viability)

Good/staple in Commander

Casual (no LD/counters, obvobvfobv) favorite

Foil/’pimp’

Collectors

However, on MTGO, there is very very little demand from casual/commander players, collectors, and everyone (currently) hates foils. This leaves just the metagame demand on MTGO card prices, such that cards not played in decks are pretty much worthless, there just isn’t any demand for them so their price falls to less than 0.05 tix.

However, there is one other factor that props up the value of some MTGO cards: redemption. Many, many sets are redeemed on MTGO and it has a very noticeable impact on prices. Because redemption takes MTGO cards and turns them into Paper ones, it effectively encompasses all of the categories of demand that paper cards are subject to, but it kinda spreads it out across the whole set (the mythics in particular). Once a set becomes non-redeemable (~1 yr after its rotation out of standard), the demand on any particular card perishes and prices plummet precipitously. This leaves only the metagame to drive the demand AND the metagames driving that demand are limited to the non-rotating formats: Modern, Pauper, Vintage, and Legacy.

Now, let’s illustrate these points using Modern legal cards. For starters, MTGGoldfish has this nice “total format price” index. This, by itself illustrates the point, Paper MTG cards are worth double their MTGO counter parts (~4,000 vs ~1,800 as I write this). However, this index only tracks certain ‘staple’ cards, which are chosen manually and thus can lag behind the actual metagame.

To get a larger picture, I’ve collected, from MTGGoldfish, the TOTAL card price history of every card legal in Modern (discounting event decks, promos, dual decks, etc) for the past 2.5 years. I’ve ONLY included prices AFTER redemption ends, that way we eliminate effects from 1) standard playability and 2) redemption. Modern Masters sets are included a month after release, when prices equilibrate, as they are neither Standard legal nor redeemable. Set symbols indicate when a new subset of cards is included in the data (the set’s entire block + core set). Also, this is not limited to unique printings, so every printing of Tarmogoyf, for example, is added into this “Total format cost”.

As you can see, in July of 2013, every Modern legal card on MTGO was worth ~$2,000 with the value of the paper cards being ~$7000. In March of 2016, when the graph ends, MTGO cards have doubled to $4,000, as have paper cards – to ~$14,000, a 3.5x multiplier that seems to hold relatively steady.

Other interesting points to note: the trends are similar between the two, with a bit more volatility in the MTGO prices. You, expectedly, get price jumps when an entire block of cards is added to the analysis in both MTGO and paper. However, take a look at MM2015. You’ll notice virtually no gains on MTGO. That’s due to the rapid equilibration between reprints – MM2015 printing of a card is cheap because it’s being drafted and that forces down the price of the original printing, too. Thus, adding all those cards to the analysis doesn’t have much of a net effect because you are simultaneously decreasing the value of many existing cards. This doesn’t really happen in paper MTG. I would attribute the ‘peak’ around MM15’s printing in the MTGO prices as increased interest in Modern…which tapered off within 3 months.

So, the sum of all Modern legal cards on MTGO is ~3.5x less than the Paper counterparts…what about the individual cards. Well, taking the prices of every card and sorting them into categories gives you this:

There are about 9100 Modern legal cards (each printing of a card being counted, no duel decks/promos/etc). On MTGO, almost 85% (7653) of the cards are worth less than a nickel…that’s kinda depressing (or exciting, depending on your perspective). From there, you can see, in every category, Paper cards have more than double the number of cards at that value. Most notable is the >$10, where MTGO has a paltry 79 cards to paper’s almost 300.

The implications of these two graphs are this: there are few cards worth spec’ing in on MTGO (in Modern, at least) and any particular card has limited gains, as only a few can break the $10 mark (meaning you’re likely to make no more than few tix profit per card, again, in Modern).

Standard cards have their own, different, price ceiling. In paper, with the standard ‘large set’, on average, you will open a complete set of cards (+ an extra set of rares) in 121 packs. Thus, the cost of complete set must be less than the cost of 121 boosters (so, like $340, ignoring the value from the extra set of rares). This is a hard ceiling; if card prices force the total set price higher, more boosters will be opened (since it becomes guaranteed profitable) until the increased supply lowers prices. To redeem a set on MTGO, you must pay a $25 fee + $3/order shipping (almost $30 for non-US shipping). This means the ceiling for a set of MTGO cards is >$30 lower than the Paper ceiling. This is why you can’t have two $100 mythics in the same set – there is a limit to the total set price. Outside of things like Jace, Jace, or Jace, you’re probably not going to have standard legal cards gain more than 10 tix value. Additionally, since you can only redeem full sets on MTGO (and redemption drives card values), rares are, as a rule of thumb, worthless. There are two rares for every mythic opened, so there is, quite literally, double the supply of every rare, compared to a mythic in a set. This abundant supply drives down the prices unless there is an extremely high demand from the metagame (K command, CoCo, Secure the Wastes, Thoughtseize, fetchlands).

These are just some numbers to keep in mind and ground yourself when ‘investing’ in MTG cards. It’s good to know the limits of the profit you can turn. And, if you are coming from paper MTGFinance, that card values are vastly different on MTGO. Now, lets move on to some other aspects of MTGOFinance.

MTGO has an Efficient Economy

MTGO is great because it’s all digital. There are no shipping fees to cut into your profits. Transactions are all done with event tickets, where you aren’t going to take a profit hit each time from transaction fees from things like paypal, ebay, or selling on TCGPlayer. All cards are near mint, you can’t lose a card (unless you lose your account...), you don’t have to sort cards, and they are already in a searchable database. There are many many sellers and buyers with a relatively high liquidity in the market. There are plenty of downsides to MTGO and MTGOFinance, but it’s important to keep these positive aspects in mind.

MTGO has an Inefficient Currency

Speaking of MTGO downsides, we have some…limitations when it comes to currency. Generally event tickets (tix) are used for transactions as the de facto currency. If you ever want actual cash to spend on things in the real world, you’re going to take a hit converting these. Fortunately, the current value of tix is relatively high and stable at >$0.93/tix. In the past, before the tix-only entry option in events, there were many many tix in the system and this supply lowered their value. However, once those events started to deplete tix from the system, their value thankfully recovered.

The other, downside to tix is that, unlike an actual currency but like a certain nation, they are indivisible. The workaround is that bots ‘save credit’ to divide tix. This works, if you are actually going to be a patron at that bot again and as long as you keep buying and selling on MTGO. Some people prefer to stick to one or a small set of bots to limit this ‘waste’. I have taken the stance of using many (30+) bots, but they are ALL bots that I know I will (or could) shop at again. Sometimes you’ll come across a bot with a good price, like selling a card for 6.3 tix when everyone else is selling for 6.8. However, you should probably stay away if that bot has a very small inventory, such that there are no other cards you’d conceivably want to buy now or in the future (small current inventory is indicative of small future inventory). What good is that 0.7 tix credit if there’s nothing you’d ever use it to buy? You would have effectively spent 7 tix on the card when you could have spent 6.8 on a bot that you will definitely frequent again (thus would actually use the 0.2 tix credit).

However, don’t be blinded by this. If RandomBot5676546 is selling a card for 0.3 tix each while all your normal bots are selling for 0.5…you can certainly buy 3 from the random bot, ignore the 0.1 credit you’d have and think of it as buying the cards for 0.3333 each, saving 0.5 tix.

I’ll mention here that this is going to affect my running total displayed on the #BoT sidebar. At the moment, I have 13.3 tix of credit spread across ~30 different bots. Near the end of the competition, I’ll consolidate and recoup these credits. But, for now, they will be unaccounted for in my portfolio.

Spikes happen fast

As I said before, redemption is digital. Transactions are instantaneous. It’s not like paper MTG where you tried to buy Ancestral Visions when the banlist update happened, had to wait for them to get shipped, then had to spend time listing and flipping the card for profit (you all did this, right?). On MTGO, you can do that whole process in under a minute. The downside is that prices can also fall extremely rapidly. A day out of town, away from MTGO, and you can come back to a rout of your specs. In MTGO, prices are set by proprietary algorithms. When cards are bought, bots raise prices, as the bots buy cards, they lower prices. Lots of people trying to buy a card will spike it hard. If the metagame shifts and many people want to switch decks, boom, prices can plummet.

To illuistrate this, we have the recent B&R announcement. I have to eat crow on this one. I thought there was NO WAY they were unbanning a card in addition to the expected and known Eldrazi ban. Thus, I was caught completely off guard by the unbanning of Ancestral Visions AND Sword of the Meek. I was on MTGO when the announcement went live, but I didn’t expect the unbannings, so I didn’t have any plan in place. I looked around for some thopter/sword pieces, but they sold out within literal seconds.

Luckily I saw @SaffronOlive’s tweet about Tezzeret, Agent of Bolas and completely agreed that he is sweet with thopter/sword. Plus, he is a mythic from a middle set. Supply would be low and he’s a ‘next level’ spec – not the actual cards that were hot (thopter/sword), but a card that will likely be in a deck with them (so buyouts would be slightly slower). Looking around for copies for sale confirmed that he was in low supply, as there were few available. I only had ~15 free #BoT tix, so I bought a single copy at 14.288 (full disclosure, I bought 10 more around that price with my own personal (read: non-#BoT) spec tix).

That evening, as I was making dinner, I checked the price. Sure enough, it had shot up over 10 tix. Now, I’m not so sure thopter/sword is actually tier 1. Even if it is, would the Agent of Bolas be the best build of the deck? Because of that uncertainty, I decided to lock in my profits and sold for 23.44 tix – a 9 tix profit over the course of as many hours. Had I more free tickets, I would have been able to go deeper and make quite a nice profit. However, as I mentioned, I was not expecting such a crazy B&R announcement, so I didn’t leave a cache of tix to make quick specs like this. Had I not pulled the trigger, I could have been selling him right now for >33 tix each…c'est la vie.

Prices can be volatile and cyclical

I have yet to understand why, but there are several cards on MTGO that have a extreme cyclical spike-trough pattern. For example, Dismember (NPH), before its Modern Masters reprint. Every couple of months it would seem to shoot up more than 2 tix, then fall back down. Identifying these cards provides a good opportunity to make ‘easy money’. For Battle of Tix, I went with:





Groundswell Groundswell





Gut Shot Gut Shot





Utopia Sprawl Utopia Sprawl





Glistener Elf Glistener Elf





Journey to Nowhere Journey to Nowhere

These all show a cyclical pattern like this and were at a low point when #BoT started. Additionally, they are very cheap pickups, so have little associated risk (but also little reward). Journey to Nowhere was doing quite well, but started to plummeted before I had decided to sell. Luckily, I noticed the downward trend and got out (read: panicked) with a 1 tix profit, though it should have been higher – it is difficult to know exactly when to sell. Utopia Sprawl did okay as well, netting me 1.6 tix, though I again missed the peak to sell out. Groundswell, similarly, was doing well and I chose to hold out for more profit. It then started to fall, but I feel confident it will rally (Infect is good in new modern, right?). Gut Shot hasn’t seen much movement, so I’m just holding for now. Hopefully, BoP- and Elf-rich decks will be good in post-Eldrazi Modern (or if Eldrazi stays good), giving Gut Shot a home and raising its price.

Redemption and New Standard

Redemption drives card prices (demand). Cards for redemption come from sealed/draft events (supply). The majority of sealed/draft is done with the most recent block. These three facts result in a price increase of existing Standard legal cards when a new block is released. These cards are still legal in Standard and are redeemable, but they are not being drafted. Demand stays relatively constant while supply dries up. I took positions in a few cards that I expect to benefit from this trend, with a bonus that they could spike if they happen to be good in standard with SOI and EMN. These cards include:





Shambling Vent Shambling Vent





Surrak, the Hunt Caller Surrak, the Hunt Caller





Caves of Koilos Caves of Koilos





Llanowar Wastes Llanowar Wastes





Evolutionary Leap Evolutionary Leap





Kozilek, the Great Distortion Kozilek, the Great Distortion





Sylvan Advocate Sylvan Advocate





Kiora, Master of the Depths Kiora, Master of the Depths





Hallowed Moonlight Hallowed Moonlight

I already got out of Caves of Koilos and Sylvan Advocate, netting 4.35 tix. I’m confident the others will rise so I’ll at least break even, though Shambling Vent is doing quite well already (did I jinx it?)

Prices are Lowest After a Set Becomes Non-redeemable

Again, redemption drives prices. When a set becomes non-redeemable, redeemers will liquidate their remaining incomplete sets. This is an influx of supply. Coupled with this is a severe lack of demand. Few cards are actually tournament playable in Modern/Legacy/Vintage, so there is little demand for Theros cards, for example. High supply + low demand = low prices. This can be seen dramatically with Theros prices. Redemptions unexpectedly ran out in Feb of 2016, and prices tanked. However, this represents a good time to pick up cards that should have a low, but sustained level of demand, raising their prices in the long term.

For this trend, I picked up Xenagos, the Reveler, Purphoros, God of the Forge, and Heliod, God of the Sun. Unfortunately, the ‘true’ low for these cards was in March, as the redeemers were liquidating, but I couldn’t get in on them til #BoT started in April. Nonetheless, they’ve all seen rises. I got out of Purphoros, making 4.2 tix profit and the other two have risen enough so that I’ll make at least a very small profit, but I’m still holding out for more. As a bonus, if Xenagos actually makes it into a successful Modern deck…I’ll make bank with my 48 current copies.

Card Prices Across the Board Tank During Release Events

People love playing with new cards. They’ll do anything to meet this goal. This includes selling any existing valuable cards in their collection. Thus, during release events there’s generally an across-the-board decline in card prices. This got me, I believe it was the reason Utopia Sprawl didn’t peak higher (what better to sell than an expensive common you have many of?). Several of my other targets have also lost some value. Hopefully it is simply due to this temporary supply glut and they’ll recover. Time will tell.

Other Cards I’ve Sold

I think it’s important to mention any specs I’ve completed that didn’t fit into the above categories.

Lightning Helix (RAV) : Was at a low point, so I bought in and it spiked quicker than I expected so I got out, making 10.5 tix profit.

Worldspine Wurm (RTR) : Also at a bit of a low point. I expected the Eldrazi ban to make Grisel Bran (the cereal with 100% DV of salt in every serving) better. However, the unbannings made blue decks better, so this deck may be falling out of favor. I was up at least 0.25 tix per copy at one point (coulda, shoulda, woulda been a 4 tix profit). But, prices fell and I barely got out before I lost money. I’ll take a 0.18 tix total profit over a loss, though.

Remand (RAV) : I really expected this to do well with blue decks being a new craze. I was up over 0.5 tix a copy at one point, but, like Worldspine Wurm , these fell and I got out just in time, 1 tix profit.

Primeval Titan (MM2) : Maybe this one was just a bad decision on my part. I thought he might get a bump from the B&R announcement, but that didn’t pan out.

Glimpse of Nature (CHK) : This was opportunistic, as the price fell. Price grew a bit and I got out at a 0.55 tix/copy profit. I would expect this to be reprinted in EMA and I wanted to liquidate these to move into other things, so I took my profit and ran with it.

Kytheon, Hero of Akros (ORI) : This was me trying to take more risks and get into standard cards. Luckily it paid off and Humans was indeed a good deck, then it seemed to not be such a good deck and I sold for a 11.3 tix total profit.

I am always available to take questions via Reddit or Twitter (@MTGKaioshin)

Joe Hill