New research shows their return is nothing to do with – and almost better than anything you can invest your money in
Some of us still have a few old Lego sets in the garage that we just don’t have the heart to throw away. And it turns out that maybe we shouldn’t. In fact, Legos can be a better long-term investment than gold, art, stocks, or bonds.
About 10% of wealthy people put money into collectibles – usually jewelry, cars or wine – as investments. But research has shown that many of them carry risks like counterfeiting or include high storage costs, not to mention that they are often only accessible to the very wealthy.
Which brings me back to those Legos in the garage. Researchers analyzed the prices of 2,322 Lego sets from 1987 to 2015 and found that the average return on the secondary market (Lego sets sold by collectors rather than stores) was around 10-11%, higher than that of gold, stocks and bonds.
“Investors in Lego generate high returns by reselling unboxed sets, especially rare sets, that were produced in limited editions or a long time ago. Sets produced 20 to 30 years ago are making Lego fans nostalgic and their prices skyrocketing,” study co-author Victoria Dobrynskaya explained in a press release.
Dobrynskaya and her team also found that Lego sets that became more valuable over time were either very small or very large, while medium-sized sets were less lucrative. They assume this is because very small sets contain exclusive pieces and larger sets are produced in limited numbers.
While the results may be promising for aspiring collectors, members of the r/LegoInvesting subreddit seem unconvinced by the study’s hype. As ZmaGiant points out in an article, the report “could create an interesting setback in the market. There are more people than ever looking for secondary turmoil, a large buyout by new investors would send these prices skyrocketing, creating a bit of confirmation bias. But a few months later, when these new investors want cash, they may find they’re holding that proverbial bag.
ZmaGiant further speculated that anyone investing based on this study alone is unlikely to be patient enough to hold out long enough to sell their Legos with a high return.
But if they do, one thing is certain: they are building their financial future brick by brick.