Valiant expensive variants... and the market in general.

[greg]

I made a similar post over at the CGC message board about recent expensive variants (specifically Amazing Spider-man #667 Dell'Otto variant)
http://boards.collectors-society.com/ub ... er=9751956" onclick="window.open(this.href);return false;

... but I want to discuss the Valiant variant situation here.

When there was only one type of comic (no variants), every copy was the same... apart from the condition.

What I've come to realize is that variant comics create a scenario where the "total market" for a comic book isn't just a simple calculation of the number of copies times the average price.

The "total market" is the number of copies of each variant times the average price for each variant.
We're all interested in the average price for the rarest variant books, but I think we can learn something from the pre-variant days of collecting... before we had to talk about each variant.

Harbinger #1 (1992) is an example where there was not a variant. There might have been 40,000 copies printed and the average copy might have been a 9.2 or so... so the total market for Harbinger #1 might have been at least $2,000,000 back in 1994 (the height of the Valiant craze) when you could easily get $50 for Harbinger #1 in an average condition. Some copies had the coupons clipped, but 9.2 was generally considered "high grade" and many 9.2 might have sold for $100 or more... balancing out those damaged clipped coupon copies.

Today, I'd be surprised if 30,000 copies still exist... and the average surviving copy might be closer to 8.5 today, since those that weren't destroyed have probably added some damage (on average) in 25 years. If the value of a raw 8.5 copy is about $50 today, and 30,000 still exist, then today's "total market" for Harbinger #1 (1992) might be $1,500,000.

Similarly, if there are still 30,000 copies of Harbinger #2 (1992) and they're worth about $8 each in average (8.5) condition, then their collective value would be around $240,000... or about one-sixth the "total market" of Harbinger #1. Is Harbinger #2 about one-sixth as important? Seems like that's not far off.

Even though Bloodshot #1 (1993) is a very common book, there are probably still at least 400,000 copies (when 600,000 were printed), and at $1 each (because it is possible to find them in large bulk), that would be $400,000 collective value.

Moving into Valiant books with variants, Archer & Armstrong #0 (1992) had about 100,000 copies printed, so let's say 75,000 still exist. There were 5,000 Archer & Armstrong #0 Gold (1992) printed, and they were special and likely better protected, so let's say 4,500 still exist.
When it comes to the collective value for all copies of Archer & Armstrong #0 (1992), we've probably got $375,000 for the regular edition if they're $5 each (average condition for all existing copies), and another $112,500 for the gold variants... if they're $25 each in average condition. That's a total of nearly $500,000... about one-third of Harbinger #1 (1992) collective value, but about double the Harbinger #2 (1992) collective value. That's also higher than the collective value of Bloodshot #1 (1993). That seems to make sense to me, since Harbinger #1 is such an important book, and Harbinger #2 is a strong pre-Unity issue, but the first appearance of Archer & Armstrong is probably twice as important as Harbinger #2 collectively and the first appearance of Archer & Armstrong is probably more important "collectively" than the first Bloodshot issue (which isn't his first appearance), but was a high print run book.

Although Archer & Armstrong #0 Gold is probably only about 5% of the remaining copies, and Archer & Armstrong #0 regular edition is about 95% of the remaining copies... about 20% to 25% of the collective value is in the variants.

Looking at Bloodshot #0, there were 300,000 regular copies, 5,000 gold editions, and we know of 25 platinum and 1 pink prototype-style edition. Let's say those 300,000 regular editions are still around 250,000 copies and worth $2 each, once you factor in the cost for shipping/travel/whatever that it would take to actually round up quite a few of them once you exhausted the bulk buys at $1 each or less. That's $500,000 for the regular editions.
If the gold editions are still around 4,500 copies... at $10 each, that would be $45,000 more. Since we saw the variant for Archer & Armstrong #0 result in about 20% to 25% of the collective value, it's a little strange that Bloodshot #0 Gold is only about 8% of the collective value.
Even if we say that every average Bloodshot #0 Gold is a $15 book on average, that only gets us to 12% of the collective value. Where is the other 10%? Obviously, it's in the Platinums... and that's what we see. 25 known copies of Bloodshot Platinum (and 1 Pink) sharing 10% of the total collective value of the Bloodshot #0 market would be $55,000 divided by 26. That's $2,100 each... on average for Platinum or Pink. Higher than $2,100 for Pink, higher for CGC 9.8 Platinum, but $2,100 average for those 26 books.

It's a little weird how well that works, using Archer & Armstrong #0 Gold to estimate a price for Bloodshot #0 Platinum.

When it comes to a book like Divinity #1, there might be 15,000 copies in existence. An average copy for every version of the book EXCEPT the 1:40 Larosa variant might be about $12. So, the collective value for Divinity #1 (not including Larosa) might be $180,000. Is that reasonable? Well, that's less than our estimate for the collective value of Harbinger #2 (1992). Divinity #1 isn't a pre-Unity classic Valiant book, but it is the first appearance of a new character in the new Valiant. Approaching the collective value of Harbinger #2 (collectively) might not be far off for Divinity #1.

Now, if the Divinity #1 1:40 Larosa variant follows the 20% to 25% of the collective value pattern, we should expect that another 20% to 25% of the collective value is in the Larosa variants. That would be $60,000 out of $240,000 (25%). If there are 350 copies of the Larosa variant, then each one might be around $171 (because $60,000 divided by 350 is $171). The Divinity #1 1:40 Larosa variant sells for more than $171, but we're estimating using old Valiant books as our reference. If the average condition for all copies of Divinity #1 1:40 Larosa variant is 9.2, then $171 each probably wouldn't be far off, or maybe the Divinity #1 1:40 Larosa market will settle a bit... but $171 isn't exactly $20. That Larosa variant looks like it's got strong fundamentals... at least as far as all these assumptions go.

[tchalla8]

Sorry....I think my brain exploded and oozed all over my desk about halfway through....

[greg]

Sorry....I think my brain exploded and oozed all over my desk about halfway through....

Valiant collecting is already a weird place to be. Theoretical Valiant pricing rationale is only for the weirdest of us. Consider yourself "normal".

[mkb28]

Things that make you go hmmm!

Interesting analysis, Greg.

[DirtbagSailor]

This. Yes. Well done Greg!

[possumgrease]

Variants. I just don't understand them. On the one hand, I think of them as manufactured collectibles destined for failure, but considering the prices that people are paying for some, there must be actual demand, either from many collectors or a few zealous collectors with disposable income.

$9k for a del Otto book whose only claim to fame is a cover with a by-design limited print run? We've moved beyond Beanie Babies, pogs and Franklin Mint territory.

To each his own though, right?


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[Elveen]

Greg can I get all that in a few bullet points?

It's Sat. Morn, it's been a mentally exhausting week, I sorta feel like my students do during 6th period after 3-4 tests earlier in the day.

Bullet points ?

[greg]

Greg can I get all that in a few bullet points?

It's Sat. Morn, it's been a mentally exhausting week, I sorta feel like my students do during 6th period after 3-4 tests earlier in the day.

Bullet points ?

That was my original intent last night, but I didn't think I could jump into bullet points without explaining myself.

Now, I can do bullet points.

- Established Valiant books like Archer & Armstrong #0 (1992) have an estimate of 95% regular editions and 5% variants by the supply numbers.
- The value of Archer & Armstrong #0 (1992) is more like 75% for regular editions and 25% for variants, (not 95%/5%) because the variants (Gold) are more valuable.
- If that's possibly some kind of "75/25 rule" that variants are 25% of the total value for an issue, then Bloodshot #0 would have 75% value for regular editions and 25% value for variants.
- We see that Bloodshot regular is about 75%, and Bloodshot Gold is about 12%, but that would mean that Bloodshot Platinum is about 12%.
- If Bloodshot Platinum was about 12% of the total value of all known copies of Bloodshot #0, the platinum books would be about $2,100 each... and they are.
- The Bloodshot Gold + Platinum situation is that the variants are worth about 25% of the total value for all copies of Bloodshot #0... the 75/25 rule holds up to the test.
- Applying the 75/25 rule to a new Valiant book like Divinity #1, it would mean that Divinity #1 1:40 Larosa variants would be about $171 each... and they are.

Conclusion: We might have found a previously-unidentified equilibrium point in the market where comics with variants are about 75% of the total value for the regular editions and 25% of the total value for the "most preferred" variants.

[Elveen]

Thanks for the bullet points.

Now I think I need an Evil Greg interpretation.

[evil greg]

Thanks for the bullet points.

Now I think I need an Evil Greg interpretation.

Variants suck the value out of regular edition comics.

If there are 10,000 comics for $4 each, that's $40,000.
But if 500 of them are variants, the 500 variants suck $1 away from the other 9,500.

So, you get $3 regular editions (9,500 of them),
and you get $19 variants (500 of them),
but the original $40,000 is still $40,000.

Variants are vampires.

[StarBrand]

[greg]

Simplified...

A = Total supply
B = Normal value
C = Variant supply
75/25 rule

D = estimate for the variant value

D = A * B * 0.25 / C

[greg]

Simplified...

A = Total supply
B = Normal value
C = Variant supply
75/25 rule

D = estimate for the variant value

D = A * B * 0.25 / C

Archer & Armstrong #0

A = 105,000
B = $10
C = 5,000

D = 105,000 * $10 * 0.25 / 5,000 = $52.50 for Archer & Armstrong #0 Gold

[nycjadie]

Shadowman 13
A = 9400, give or take
B = $4.5 (average between the A & B cover)
C = 1:20 470, 1:50 188
D = 9400 X 4.5 X .25 / 658 = $10,575

1:20 - $19 x 470 = 8930
1:50 - $110 x 188 = 20680

I'm sure my math is off, but these numbers would suggest that this variant may be priced at much more than 25% of the value of the print run?

[greg]

Shadowman 13
A = 9400, give or take
B = $4.5 (average between the A & B cover)
C = 1:20 470, 1:50 188
D = 9400 X 4.5 X .25 / 658 = $10,575

1:20 - $19 x 470 = 8930
1:50 - $110 x 188 = 20680

I'm sure my math is off, but these numbers would suggest that this variant may be priced at much more than 25% of the value of the print run?

The 75/25 rule is applied to the imaginary scenario that there are no variants.

Once it is applied, it's not 75/25 anymore... because that would be a kind of circular calculation.

[greg]

The preferred variant for Shadowman #13 is the 1:50... so even though the 1:20 is a variant, it isn't the "top variant" for the 75/25 rule.

Also, the Comichron number of 9,400 for Shadowman #13 is North America, first month only. Let's use 11,000 copies for the total supply, rather than the 9,400.

A = 11,000
B = $4.50
C = 220 (the 1:50 only, calculated... it's probably more like twice this amount)

D = 11,000 * $4.50 * 0.25 / 220 = $56.25 each for the 1:50 variant

The problem with this book is that we don't know where those 220 are... the market values this book at about double the $56.25 estimate.

So, either the book is overvalued at $110, or the supply of Shadowman #13 1:50 behaves as if there are only about 115 copies in circulation.

[greg]

Another possibility is that Shadowman #13 might be a $9 comic if there were no variants, and B should be $9.

[jmatt]

Can you dumb it down a bit more for me. Perhaps a chart?

[greg]

Can you dumb it down a bit more for me. Perhaps a chart?

Check a few posts back for evil greg.

He's pretty dumb.

[400yrs]

Simplified...

A = Total supply
B = Normal value
C = Variant supply
75/25 rule

D = estimate for the variant value

D = A * B * 0.25 / C

Archer & Armstrong #0

A = 105,000
B = $10
C = 5,000

D = 105,000 * $10 * 0.25 / 5,000 = $52.50 for Archer & Armstrong #0 Gold

That right there is beautiful.

[Sunlight on Snow]

I've just sobered up and now I am suddenly feeling awfully dizzy again!

[mkb28]

Greg:

Were you once a janitor in a Boston University that would sometimes complete math problems that were left up on the chalk board?

Good stuff!

[onearmedwampa3000]

Simplified...

A = Total supply
B = Normal value
C = Variant supply
75/25 rule

D = estimate for the variant value

D = A * B * 0.25 / C

This is great stuff Greg. On your initial Bloodshot 0 example how do the VVSS factor in with the Gold, Pink, and Platinum?

[greg]

Simplified...

A = Total supply
B = Normal value
C = Variant supply
75/25 rule

D = estimate for the variant value

D = A * B * 0.25 / C

This is great stuff Greg. On your initial Bloodshot 0 example how do the VVSS factor in with the Gold, Pink, and Platinum?

The VVSS would complicate the discussion quite a bit... The original intent of the formula was to calculate for the "most preferred variant"... since that is the book without any ceiling (in theory). The other variants are automatically valued below the "best one".

[myron]

this is some awesome analysis...thanks greg and evil greg...