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Brickpicker Blog

Brickpicker blog articles on LEGO investing, news, reviews, evaluations, discounts and more...
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I want to start a regular blog that will update the information I presented there along with an expansion to include the other time periods available and a little analysis/commentary.
Firstly some notes on the scope before I begin:
I have not restricted the qualifying sets by size or age or any other dimension Information is based on US prices only Not all themes are included as I have zero interest in Bionicle/Hero Factory for example. (I just didn’t have the willpower to gather the data for them really). Most of the rest are covered though. I tried to look at as many sets as possible, but there is a chance a few may have been missed, if you spot some that should/could be included please let me know One Month Growth (change in Market Price from last month)

52% growth in one month for a Star Wars battle pack tops our list. That’s an impressive performance and one that’ll make the Star Wars and minifigure punters happy. The list is dominated by releases from 2009 onwards and on reflection that makes sense as many of those sets will be recently retired or approaching EOL so will be enjoying a bit of a price spike.
It will be interesting to see if any of these sets can maintain some of this growth longer term. Which leads us nicely onto our next time period:
Six Month Growth (change in Market Price from Nov 2012 )

6808 blows them all away with 400% in six months! Looking a little closer though you can see this was on the back of only 3 sales and a price jump from $1 to $5, so not as impressive as it may seem. Highlighting the volatility of a small set with low volumes. The same criticism can be levelled at the rest of the top 4. Then we come to the 21016 which is part of the Architecture theme. 106% has been spectacular and I’ve never seen this set mentioned around before on the forums (sure it probably has but I’ve missed it). Not many people would have picked that ahead of the widely known 9465 Zombies that has had such a well documented rise to fame. Maersk Train is perhaps the only other set on the list that is widely discussed.
One Year Growth (change in Market Price from May 2012)

Because I went through this exercise using last months data in those previously mentioned forum posts I can now add in a column for the change from last time for these next three time periods.
The top 4 sets on the list all suffer the same low volume volatility issue. Then we get the Level Crossing and Hogwarts Castle that have had plenty of copies sold and were on my previous list for this time period but have slipped a few places. NRG Jay enters the list with a strong performance. Quidditch Match and Lighthouse Island have both shown their respective growth periods are not waning yet as they increase up the ranks.
Two Year Growth (change in Market Price from May 2011)

Now into the two year time frame we begin to remove some of the short term fluctuations that can occur with some of the narrower time periods. Level Crossing tops the list still and there are plenty of other well known sets making an appearance. Notably absent is the 10179 Millennium Falcon who “only” scores 103.6%.
I was surprised by the number of new entries to the list as I expected it to be fairly stable. But some of the new ones have had good growth in the last month or two which brings their 2 year result up quite a lot.
Retail Growth (change in Market Price from Retail Price)

Now for the full measure of growth from the retail value of the set. Obviously a set with a $0 listed retail price like all the promo giveaways etc are excluded as we can’t divide by zero, so that has weeded out a few of the small polybags or very very old sets for which we have no retail data. But the list is still dominated by cheap sets that have increased by large multiples. Most are very old as well and therefore have the same low volume volatility problem. Perhaps the first “real” contender is 10190 Market Street, such an impressive result for a set in just 6 years. 7884 Batman’s Buggy is an unexpected surprise that I was really aware of until now, but I’m sure some of you will know it well and have invested accordingly.
Conclusions
Completing this exercise I’ve been a little surprised at the volatility in the results. Sure, I expected some of the cheap older polybag sets with super low volumes to dominate the lists a little, and that’s something I might address in the future with a volume limit or something similar. But the amount of change from one month’s table to the next (in the last 3 periods) was an eye opener. It means that it is going to take a few more months of doing this before we can see the trends appearing.
One thing that does explain it a little is the fact that the filter algorithms Jeff has developed for the Ebay listings are constantly being improved and this means that the data you see for one month’s update may get altered next time around as the filters get enhanced.
The other major discussion point is that these top 20 lists all the absolute best investment decisions you could have made if you had perfect future knowledge. The amount of under the radar sets and “sleeper” hits have been a big wake up call for me. We sometimes become a little circular in discussing the popular sets for investing (Modulars, UCS, etc) and lose sight of the fact that many of the best investments to be had right now are probably some of the least discussed sets. It does mean there are plenty more topics ripe for discussion on the forums and in blogs.
I’ve only given a cursory analysis of the lists themselves and would like to leave it to you on how best to interpret the results. The numbers should speak for themselves and I’d like to hear your take on them in the comments below.
Analyse those investments you made back 6 months, 1 year, 2 years ago and ask yourself how they compare to the lists above. Could you have made a different choice considering the information you had available at the time? Did you perhaps miss out on a few of these top performers because you thought they would be less profitable than they sets you did buy? Are there lessons you can learn from that to help you with making current and future investing decisions. The smart investor should be constantly assessing performance to create a feedback loop with the goal of enhancing future profitability. Good luck
Note: Following on from these two forum posts:
http://www.brickpicker.com/forum/index.php/topic/3681-what-did-you-invest-in-1-year-ago/ http://www.brickpicker.com/forum/index.php/topic/3878-top-20-sets-2-year-return-rates/
Semper Paratus - the United States Coast Guard's official motto - should serve as a beacon to Brickpickers. Translated from Latin, it means "Always Ready", and while it's appropriate to the core mission of the US Coast Guard, it's doubly appropriate for savvy investors on the lookout for their next investment purchase. This summer, BP members should recognize a familiar sight: a new wave of Coast Guard sets will be sailing into brick and mortar retailers. Should Brickpickers keep an eye out for discounts on these sets, or let them sail into the sunset?
To provide a basis for assessing the potential of the new line, it's critical to review the return profile of the original. Released back in 2008, the original Coast Guard sets were released in two waves. The first was highlighted by 7739 Coast Guard Patrol Boat and Tower, while the second was headlined by 4210 Coast Guard Platform, a once-in-a-lifetime sea base set in the middle of the ocean, similar to an oil rig. Here is a quick review of the first Coast Guard sets:

It's pretty clear the secondary market loved the first wave of Coast Guard sets. And why not? The sets have a great color scheme, it's a nautical theme so boats abound, and to top it off, the Coast Guard Platform is unique among City sets. I believe the Coast Guard platform outperformed the rest of the sets, despite it's high MSRP, because it was on the market for only 5 months. Frankly, the rest of the line likely benefitted from the theme's quick retirement as well, with none of them lasting more than 8 months on retail shelves.

What a phenomenal set! 4210 Coast Guard Platform
Interestingly, there were three previously released Coast Guard sets, but they weren't released as part of a subtheme. 369-1 Coast Guard Station was released in 1976, 575-1 Coast Guard Stationwas released in 1978, and 6435 Coast Guard HQ was released in 1999. While the data is a bit spotty, it appears only 575-1 performed well after retirement, fetching an average of $259 for a sealed box.
How will the new releases perform? Well, let's review the current releases along the same metrics as we did for the first:

Look familiar? The 2013 release has an identical set line-up except it lacks a base set (a real missed opportunity in my opinion) while adding a new pontoon plane. Note the pontoon plane hasn't been released in the US yet, so this is one that could perhaps be on a limited production run similar to 4210 Coast Guard Platform.

Who doesn't love a Lego pontoon boat? 60015 Coast Guard Plane
So, we know this wave is VERY similar to the last release, but can we predict whether it will perform similarly? To assess this, let's take a look at another City subtheme that's been released twice: Construction sets. There have been two full releases of the construction subtheme: one in 2005 and one in 2009. Here are the performances of each:

Lego can be very formulaic when assembling their theme and subtheme set line up, and in this case we can utilize this to our advantage. Like the Coast Guard releases, the two construction releases are very similar in make-up: both have a crane, a construction site, and four jobsite vehicles to fill in the gaps. In comparing the performance of these sets, the 2009 release netted siginificantly less than the the 2005 releases. While 2005 has probably maxed out its returns and the 2009 sets may have a little room to grow, we should still expect a discount in returns from the 2013 Coast Guard sets. Using the construction sets as a model, expect anywhere from a 35-65% drop in ROI from the original Coast Guard release sets.
For some, that doesn't leave the BIG profits that some investors expect.
I will strongly consider adding 60015 Coast Guard Plane, especially if I can grab it on sale, because of its uniqueness among the Coast Guard subtheme, and the prior performance of the two other pontoon planes that were previously released. 7723 Police Pontoon Plane has seen a 113% ROI post-EOL, while 5925 Pontoon Plane has seen a 193% retirement ROI. Be aware that while 7723 is a good comparable, 5925 probably isn't, so lean more toward 100% when predicting an expected return for 60015.
The Coast Guard motto Semper Paratus beckons investors to be "Always Ready". In our case, it should be for new Lego investment opportunities. While the new Coast Guard sets show some promise, be sure to scrutinize every set's expected return profile before inveseting. As the construction sets showed us, a second release will likely suffer from investors' "been there, done that" ambivalence due to Coast Guard fatigue. While there are opportunities with the new Coast Guard sets, be sure to locate the rocks before diving off this cliff.
As always, invest accordingly...
Back in the summer of last year (2012) LEGO released its new and vastly improved version of one of the most iconic locations of the whole Star Wars universe: Jabba's Palace. The new version included several improved mini and maxi figs, and it was a very good recreation of the "actual" structure. What's more, LEGO apparently had planned to produce the compatible Rancor Pit for a while now, making this set even more unique.
Nothing else was really out of the ordinary about this set. Sale numbers since it really were pretty good and consistent, topping 100 copies sold on most months. Regarding its market value, the set experimented the typical spike in price that comes along newly released set as soon as they hit the market, but right after that it went into the typical downward trend as a result of retail discounting and increased availability. For several months after its release, the market value for the set ranged from $83 to $109.
LEGO investors had mostly positive comments about this set, but it was not one of the most talked about ones considering that its retirement was not expected until at least the end of 2013. What took place in the month of April, however, took everyone by surprise and produced some really crazy figures.
As early as the last week of January, news started being reported negative comments made by some religious groups making the claim that the set released by LEGO had some racist connotations. According to some of these groups, the structure resembled one of the most important structures of the Muslim community and, what's more, suggested that the Jabba character presented some stereotypes that reflected negatively on the Muslim community. We all know that Jabba is not the perfect role model and represents one of the worst criminals in the Star Wars universe, and that is what made some of these groups feel some antipathy for the set.
Fast forward a couple months, specifically to the end of March and the beginning of April. Some news outlets started spreading the news that the backlash suffered by LEGO regarding this set had prompted the company to make the decision to retire it earlier than expected. The religious groups claimed victory, and from there everything started to change.
The news of this supposed early retirement went viral and, as a result, the set in question started being purchased in larger quantities every second that passed. Prices on eBay soared, stores were completely sold out and even here on Brickpicker threads and posts related to 9516 were spreading extremely fast. From experienced investors to casual fans, passing through a more than likely high amount of average Joes hoping to make a quick buck, started hoarding the set a quickly flipping them on eBay for mark-ups of even $80 over its retail price. At one point, the set had completely disappeared from almost every single major retail store in the country, thus making eBay one of the few choices for those wanting to get a "piece of history" or at least to avoid missing out on a set they had planned to acquire later.
Before I continue, I have to say that I actually went ahead and purchased 4 copies of Jabba's Palace on April 2nd, and immediately listed three of them on eBay for around $ 160 (Got them at Target for $87). The three sets sold in less than an hour, and I was able to keep the 4th copy all to myself with the profits, and even had some money left in the end.
That personal note aside, let's now evaluate the numbers of sold sets and the price fluctuations over the past 12 months from Brickpicker's Price Guide:

You can see in the graph above just how significantly the quantity of sold sets spiked during this April event. In the month previous to the craze and the month right after, the set sold closet to 10 times less copies than during April. With over 900 new sets sold, Jabba's Palace easily became the Top Selling set of the month and set a record of monthly sold sets that will probably not be matched in the near future, if ever. Note that a few months ago, during the period when Minecraft was really hard to find it sold over 1,000 in two consecutive months.
Also, a very important fact to note is that the vast majority of these over 900 sets were sold in a period of less than a week, making it even more impressive.
This increase in sold sets had to come with an obvious price increase as well, and that is in fact what ended up happening. Take a look at the graph below where the Market Value of the set is presented:

So, in the month of April the set went up from $83 to $ 124. The spike is very obvious in the graph and one thing you have to remember when taking a look at it is that as the craze died down, the last 3 weeks of the month started seeing a decrease in the price of the set as most large retailers started re-stocking this set at retail price while short term flippers panicked and started dropping prices accordingly. If the trend of the first week had maintained for the rest of the month and the large retailers had not replenished their stock, the set would have probably gone up to at least $150.
Eventually, as always, the fact that LEGO had never said that the set would face an early retirement caught up to the market, and as demand for the set decreased, the price for the set did just the same. You can also see in the graph that the set took a hit as a result, and is once again selling at around $96 on average. Again, if it had not been for the fact that the data for the last three weeks of May get tallied as part of that month, we would probably see an even lower market value for this current 53 day period
So, now that things are relatively back to normal and the set is selling its regular amount of sets per month at close to its average price, what can we expect to see in the future? Well, there are a couple of things that are worth mentioning.
First, we need to keep our mind on the prize and remember that this set was going to be an investment winner whether the April even happened or not. This set is superb and includes some great figures in it that should carry it towards the investment Olympus. Furthermore, historical figures support the fact that Jabba themed sets do pretty well in the secondary market, and as such we can expect no less than the same from this vastly improved set. If anything, this event can give the set a boost in the secondary market product of having some sort of interesting "history" attached to it.
Another thing that we got out from the event is something that LEGO usually does not publish at all: an expected EOL date. In efforts to calm down the hysteria and later to further explain what was going on, LEGO announced that this set is expected to retire by the end of this year, as scheduled. This is one extremely rare case in which investors are handed out this kind of information and can therefore act on that as they see fit. You don't see this very often, if at all.
Lastly, these events just go out to prove how a series of misrepresented statements and the internet can affect the supply and demand for everything, even our loved LEGO. There are a lot of individuals in the market that make decisions based on whatever they see reported on the internet or entirely by hype. This kind of misinformed decisions can result in everything from wasted time to large financial loses, but it also means profit opportunities for those willing to take advantage of the situation and those that really understand the market.
What makes this event even more interesting is that we saw almost the complete opposite happen with the UCS B-Wing exactly a month later. In that case, a deep discount depressed the value of the set substantially and we'll have to keep an eye into how that affects it in the long term. For more info, read this outstanding Blog article by Quacs on the subject.
Jabba's Palace April spike was certainly an interesting phenomenon, and how it affects the set's performance in the future is something we will probably be analyzing once it goes EOL later this year into early 2014.
Thanks for reading.
 
Guest
Thought you'd never use math once you got out of school? Think again. Today, as my first personal blog article, I am going to briefly describe a method to predict a set's worth using its CAGR.
A while ago, Ed showed us what CAGR is, and how to calculate it in this blog article (http://www.brickpicker.com/forum/index.php/blog/4/entry-15-cagr-compound-annual-growth-rate-and-lego/), but for all of you who don't want to open a five hundredth tab, CAGR, or Compounded Annual Growth Rate, is basically the rate at which a set grows compared to its original value per year. A high CAGR = a good investment, a CAGR below 10% (or even a negative number) is usually a sign that a set isn't doing so good, unless the set can maintain a low CAGR for a very long time.
Often people are aware of what the CAGR of an item is, or at least what its predicted CAGR will be for a period of years, but don't know how to apply that information to see what the value will be when the item is 1, 2, or even 10 years after retirement. With a simple equation, you can find out.
Without further ado, here is the equation:
(Orignal Value/MSRP)(CAGR - a 35% CAGR would be entered as 1.35 here)(Number of Years)
The reason that a 1 has to be added in front of the 0.35 is because without it, you would be saying the set is basically dividing its value in 3 each year, which would be a negative CAGR (I'll get to that later). Now, let's work on some examples:
Assume that Set A has a MSRP of $39.99. Its predicted CAGR is 40%, and you want to know what its value will be in three years. First, substitute the values into the equation:
($39.99)(1.4)(3)
Then, calculate, remembering to always get rid of the exponent first. To work out the exponent on a calculator, punch in 1.4 and then hit the x/y key (you will need a calculator with an x/y key) and press 3. You should get an answer of 2.744:
($39.99)(2.744)
Lastly just follow through and multiply:
($39.99)(2.744)= $109.73
You're done! The answer means that if Set A continues on a 40% CAGR for the next 3 years, it will be worth $109.73 at the end of that three year period. Now I'll do one more just to make sure you all get it. Follow along with a calculator if you want and make sure you get the same answer:
Set B is worth $24.99 when it comes out. It is predicted to have a CAGR of 15%, and you want to know what it will be worth in 10 years.
($24.99)(1.15)(10) = ($24.99)(4.045) = $101.09
Now, what happens if you are trying to calculate for a set that has a negative CAGR?
I'm not as entirely sure with this calculation as I am with the positive one, and hopefully you never have to use this one. It's hard to explains so I'll just demonstrate it:
Set C has a MSRP of $44.99, and you want to know what it will be worth in 5 years. It's predicted CAGR for those 5 years is -3.67%.
First, let's transfer that negative number into something usable. Take 100 and minus 3.67 from it. You get 96.33. Next, divide 96.33 by 100 and you end up with 0.9633 (there are other ways of doing this, but I think this is the easiest to understand). Now, you can use 0.9633 as the growth (or in this case shrink) rate. Set up the equation:
($44.99)(0.9633)(5) = ($44.99)(0.829) = $37.32
I hope you all weren't to bored by all the math, but the calculation is easy and I hope it becomes of use for all of you. Now to finish off, I'm going to have a little challenge, and see who will be the first to answer:
Look up the current (May 13 Data) CAGR and MSRP of 9476 Orc Forge. If it continues at that rate for the next 2 years, what will it be worth at the end of that two year period? Happy calculating!
 
Awhile ago I placed a very large order on Bricklink to the Czech Republic for a fair quantity of white LEGO bricks/plates, etc. Some of these I ordered in USED condition to save a good deal of money. However, everyone who has an old collection knows, that among their whites (and sometimes blues and greys), lie the dreaded yellowed/discolored pieces.
The plight is certainly common to any longtime LEGO owner, and until relatively recently was a problem unsolved. Enter Retr0bright (follow the link for the full rundown), the brain child of trial and error and some great minds. Though not specifically minded for LEGOs, the findings still apply as we're all dealing with the same ABS plastic in the end.
The basic TL;DR is this: most ABS plastic (LEGO included) has added chemicals to make it flame retardant. This retardant, primarily the chemical Bromine (Br), was found to be the cause of the awful yellowing/browning of formerly white ABS plastic. The Retr0Bright mixture uses a chemical reaction between Hydrogen Peroxide, An "Oxy" based cleaner (Sodium Precarbonate as an active ingredient), and UV light (Sun or lamps) to reverse this process.
Some of you may have heard or even used this process before, but for those who haven't, here's my explanation/tutorial on how to give those whites new life (or allow you to save some money on those Used Bricklink pieces!)

Things you will need:
-1x 88 cent bottle of 3% Hydrogen Peroxide (The ideal strength for a speedy process is 10-15% for best results, but I was testing here! 3% will work just fine if it's all you can find. You will just have to wait longer.)
-1x 2 dollar tub of my grocery store's OxyClean equivalent (The only thing that matters is the active ingredient, Sodium Precarbonate.)
-1x Re-purposed Vessel (I use a butchered Simply Limeade bottle here for ultimate thriftiness. You can use any vessel really, but make sure it's clear so sunlight can pass through. Also, be sure it is NOT sealed. This process releases Oxygen from your bricks, and this can build up pressure in a sealed vessel)
How to start it up:
1-Pour an amount of Hydrogen Peroxide into your vessel that will give the amount of pieces you're cleaning enough space to float and spin around. I used roughly 1/3rd of my bottle for this test.
2-Drop in half a teaspoon to a teaspoon of the Oxy ingredient into some hot water just to mostly dissolve it, then drop it into your Hydrogen Peroxide. Less is more here. If you add too much, you can damage the surface of your bricks, so really just add a little bit. You can always add more if the reaction isn't occurring.
3-Drop in your LEGOs and shake/stir them around.
4-Leave them soaking in the sun (ideally) or under a UV lamp makes this process take a few hours versus an entire day (or two depending on the yellow-ness of your LEGOs). If using a lamp, be sure the lamp isn't so close as to heat the mixture, as the heat will be problematic to the process.
5-Come back to check on the vessel every hour/two hours and shake it around so as to make sure each face of your LEGOs gets roughly equal time in the sun.
You will know the process is working if small bubbles are forming around your LEGO bricks and floating upward. Check for this at the first hour. If the mixture is dormant, add a TINY bit more Oxy to the mixture and repeat until you are sure the reaction is taking place.
Depending on the yellowing of your bricks, you may need to soak these for as little as 3 or 4 hours (in the sun) or as long as a full day or two. The main rule is patience. Your bricks have taken years to yellow. You can burn a day or two reversing it. KEEP IN MIND, this liquid mixture will only be "active" for about 2-3 days. Up until then feel free to re-use the same mixture on your parts!
fSo onto the interesting part, my own test results!
Here's my test set of pieces. The slopes in the upper left corner are NEW white pieces to show the color difference. These are all from my 15+ year old collection save the 4x8 plate which was part of my recent Bricklink order. I tried to get a variance of shapes but in general tried to pick out some of my worst offenders:

After about a 6-hour soak in the darkness (started this process at about midnight) and about 2 1/2 hours in the sunlight, this is the same set of pieces after being soaked in the Retr0Bright mixture, again the slopes in the upper left corner are NEW white pieces:
Some of the yellowing is still visible on some of the pieces, but in general this process is amazing. I can easily soak these again for another run and I think they'll be indistinguishable from new bricks. If some of your are concerned about printed pieces, multiple tests by others have shown that printed LEGOs survive just fine, and if anything only fade a small amount in cases where the piece was severely yellowed and had to be soaked for a longer time period. Stickers will likely come off of pieces using this method.
There are also people who recommend cleaning your LEGOs beforehand, which I did not (as this was a quick proof-of-concept test). I have heard people running their LEGOs through cool cycles on their dishwashers or individually scrubbing them with toothbrushes or sonic toothbrushes. This really just removes any dirt or material from the LEGO and doesn't affect the chemical reaction.
For some references on others experiences and some other information for those unsure of submitting their LEGOs to chemicals, here are some links I used for background research:
Removing Yellowing from Plastics
LEGO Whitening: A LEGO creation by Eggy Pop: MOCpages.com
LEGO Whitening- Retr0Bright - home - Discussion
The Brothers Brick

This is a mostly copy-paste of a post I did awhile back for my Mobile Frame Hangar buddies, but it's definitely still relevant. I've since used this process to de-yellow a large amount of my old bricks, and the results were a lot better on my second run using a high concentration of Hydrogen Peroxide that you can source from beauty shops.
Whether it is an exaggeration or not, in popular culture there has always been the perception of some sort of a friendly rivalry between the two main public service branches, the police and fire departments. I really have no idea about how big this rivalry, or if it even exists, in the real world, but I thought it would be fun to play with the idea in the context one the LEGO CITY theme, so later we will be examining which of the two has been the better performer over the years.
Before we do that though, I feel necessary to give a little background on the theme overall, even if it has been discussed some in previous articles. The CITY theme was first released in 2005 to replace World City as the next theme to feature most of the “town” sets LEGO has been released over more than a decade. At the time this article was written, the theme overall presented a Compounded Annual Growth Rate (CAGR) of 13.03%, a figure above the average LEGO theme of 11.36 %. This could be attributed to the popularity of the theme with some of the most important LEGO customers, those being kids and AFOLs, due to some of the characteristics of the sets themselves that are out of the scope of this article. Let’s now focus specifically on the performance of Police and Fire themed sets.
Over the course of the years, Police and Fire sets have been one of the staples LEGO keeps producing almost continuously. Having your own fire or police station forms part of almost every single kid’s dream while growing up, and LEGO understands and capitalizes on that really well by always expanding both of those sub-themes and keeping them on the shelves year after year. Even more, AFOLs have proven to be another group that is very interested in the sets, not so much for traditional play but for recreating large and realistic looking cities.
Among both sub-themes, there has been a long list of really nice and varied sets; small, large, stations, boats, planes are just some examples. Furthermore, LEGO has been releasing some very interesting sets that deviate some of the more traditional ones we named before, like the more recent Police Dog Van or Bank and Money transfer, that add some more depth and realism to any city.
From an investor’s standpoint, there seems to be some sort of animosity towards some of the CITY sets that fall into the fire or police category, mostly due to something stated above: there are a lot of remakes and re-releases. This is an issue that a lot of investors worry a lot about while making their investment decision, because it would appear that if a set that retired just two years ago is re-released after such a short period of time, collectors and fans would opt for the newer and cheaper version rather than going for the old version that usually goes for above MSRP.
While some investors are right in their perception concerning remakes and their negative impact on growth, this does not necessarily mean that sets are investment losers. From some of the information you will see a little bit later in the article, you will be able to verify that several of the sets that have been re-released in some form or the other most of the time are very strong performers. In the case of CITY police and fire sets, the real issue with remakes is not really that hampers long term growth, but rather that the sets do not usually provide the possibility of making a decent return shortly after retirement (within a year of EOL). Some of these sets do take some time to appreciate substantially, but in the end they DO perform, so I would really recommend them only to those who really have a long term investment horizon rather than a short one.
Let’s now go into detail a little bit more. The following tables present all the sets that have been retired so far on both the police and fire sub-themes, leaving out the promotional sets and those that have less than 50 pieces.
Police

Fire

OVERALL WINNER: Police
*Note that the Police sub-theme has more recently retired sets than Fire does, a factor that could skew the CAGR higher.
It appears from the tables above that CITY police sets easily beat fire themed ones (I’m sure some of the law enforcement related members in the forums will be happy with those results). The average CAGR for police sets is around 15 %, while the fire themed sets “only” grow at about 10.6 % per year. Interesting to note is the fact that if we divided this themes out from the larger CITY and place each on Brickpicker’s overall them CAGR, police sets would place well above the LEGO average CAGR, while fire sets would place slightly below.
Going deeper into the numbers there are several things that I think are important to examine in this article. Note that each sub-theme could be divided even further in some categories like Stations, Boats, Helicopters and so on, that in my opinion give us a little more information about which specifics sets tend to do better than the rest overall.
First of all, you will be able to note that the station type sets, the ones that are re-released most of the time, do end up appreciating pretty well in the long term. In some cases they even turn out to be extremely good performers (7945 and 7744), while some of the newer ones, as you can see, have appreciated very slowly since they were retired. This trend fits well with what I talked about in a previous section.
A second thing I wanted to highlight was which sets have usually been the best performers among both themes. If you take a look at the table above, a very specific type of set immediately jumps out on both sub-themes: Boats. As it was examined on a previous EC article, boats and ships have usually been really solid choices when it comes to LEGO investing, and it would appear that also applies when considering smaller CITY sets. The 7906 and 7207 Fire Boats, along with the less traditional 7944 Hovercraft, have all more than doubled in value, while the 7287 and 7899 Police Boats have performed in a very similar fashion.
Finally, as with every theme, there have been some sets that have really not performed as good as we would like. Having said that, we really can’t expect every single set to be an investment home run, and it really all comes down to being able to pick the right sets at the right price.
Overall, I think you should be pretty satisfied by the overall performance of most Police and Fire themed sets. Even though you don’t really hear that many good things about them, mostly because they are there ALL THE TIME, their historical performance has proven to be a solid one, so you can definitely be sure that by putting a little work and research into these sets they can become a very important part of your diversified brickfolio.
To conclude, let’s go ahead and examine some of the CITY fire and police sets currently available:
7498 Police Station VS. 60004 Fire Station


Comments: These are the two most recent stations on both sub-themes, and they are extremely similar in almost every significant aspect. Both stations have pretty much the same amount of pieces, same MSRP and therefore same Price Per Piece ratio, also at first sight, you will note that even the building structures share some of the same design elements.
The Fire Station was just released a few months ago, while the Police Station is rumored to be closing in to retirement. It is somewhat hard at this point to determine which one will perform better in the secondary market, but just basing of historical data I would have to go with the Police Station.
WINNER: Police
60008 Museum Break-In VS. 4209 Fire Plane


Comments: The Museum Break-In set is one of those more unique sets that LEGO has been releasing more and more trying to expand the variety of Fire and Police sets beyond the more traditional sets. The set is really very cool looking and has some very nice details that enhance the looks of the recreated scene, like some paintings and other artifacts that the thieves are looking to remove, the museum itself, and the police helicopter. On the other hand we have the Fire Plane that is one of the best looking fire sets currently available, in my opinion. The plane comes with several 1x1 blue translucent bricks that are used to simulate the water dropping from the compartment to extinguish the fire, as well as some other nice features like a fire truck (that connects to the plane as well), a couple of “burning” trees and some other minor accessories. As much as I also like the Museum Break-In, LEGO planes overall have proven to be really great performers, so if I had to pick, I would definitely invest on the Fire Plane.
WINNER: Fire
4439 Heavy Lift HelicopterVS.60010 Fire Helicopter


Comments: The 4439 Heavy Lift Helicopter is a really cool design based on a helicopter design that is not seen that often in LEGO sets, if ever. The body of the helicopter is really big and comes with two rotors, one in the front and one in the back. On the fire side of things, we have the 60010 Fire Helicopter that has a very high price per piece in comparison, mostly due to the inclusion of the motorized winch piece. Leaving that aside, the helicopter is more traditional looking, but the set does come with an extra section where “fuel” canisters appear to have caught fire, so there is extra playability with that too. Both models have things I consider very unique, and that does not allow me to pick a winner in this match up.
Draw
7288 Mobile Police Unit VS. 4430 Fire Transporter


Comments: The Mobile Police Unit shares some similarities with the retired Police Command Centre, as they are both mobile police units. The performance of the Command Centre has not been that good at this point, and it has been retired already for a little more than two years. There are really not any redeeming features that would make me assume that this newer version will perform any better.
The 4430 Fire Transporter is a Toys R Us exclusive, something that could be considered a positive aspect since its availability will be fairly limited, but that not always translates into great future returns. Other than that, the set is very interesting and a mobile command center kind of set seemed to be missing from the fire sub-theme.
Winner: Fire
60007 High Speed Chase VS. 60005 Fire Boat


Comments: The High Speed Chase set is pretty cool on its own, as it includes a Chase McCain minifig, along with some features that are necessary in every high speed chase: a patrol car/truck, motorcycle and a very fast looking sports car. There are also some minor features like the spike strip, barriers and cones.
Having said that, I really think there is no way for the police set to be able to beat the Fire Boat. As we have talked about before, boats in both themes have proven to be one of the most successful investment choices along the years, and I really see no reason for this last version to be the exception.
Winner: Fire
Final Tally for Current Sets: Police 1 VS. Fire 3 (1 Draw)
So, despite Police sets being historically better performers than Fire ones, I really think that the current selection tilts the balance more in favor of the latter.
These sets examined above are not the only ones that are currently available, just the ones I really wanted to cover and that I felt could match up. The most important set I left out of this analysis was the 4440 Forest Police Station, that at this point is really one of a kind and could turn out to be a great investment as well.
Now that we finished that, I hope at least some of you who were not thinking that much about CITY fire and police sets as an investment may change your minds and at least take a closer look at some of them, there is really the possibility to earn great returns on some of these, especially boat and plane sets!
Thanks for reading
I just pulled this off the brickultra.com website. Apparently, TLG is finally getting around to releasing a TMNT polybag. Here's what it looks like, and the link to brickultra's story:

http://brickultra.com/new-lego-tmnt-polybag-30270/
My take: I think this is another in a long line of questionable decisions made by TLG regarding the TMNT theme. The first polybag should be an enticement to buy more of the theme, and I really question whether the best approach was to include a "Krang in the Robot" minifig. It's already included in the Shellraiser Street Chase set, and while Krang is an important enemy to the turtles, Shredder should be their primary concern.
In a broader sense, I think the stars of this entire theme are the turtle minifigs, so why not include one of them in the first polybag?
Also, while I understand flick missiles are popular add-ins to polybags since they give a small set some instant playability, it's still a flick missile. Further marginalizing the flick missile is the ridiculous "set-up" that Krang is shooting at. They appear to be painted boxes intended to mimic the turtles, but why would anyone ever fire a missile at a group of painted boxes? This is what a 7 year old does with a beebee gun, not a technologically advanced missile-firing artillery cannon.
If you can't tell, I've been very disappointed with the TMNT theme. The figs are phenomenal, but everything else has been a hot mess. From the anchor set not being the largest of the theme to the numerous complaints about the fragility of the Shellraiser set, it appears TLG (and whoever licenses TMNT to Lego) has really mucked this theme up.
That said, I think the lair has a chance to provide decent returns in the secondary market. It's got Splinter and two Ninja Turtles: Leonardo and Raphael. The turtle lair is neat looking, and a base, so it has nice realism, detail and playability.
I will not be going anywhere near the rest of the theme.
 
In this 3rd Edition of the Re-Make Impact Evaluation section I will be focusing my analysis on a set that may not be one of the most noticed or liked by investors and collectors: the Gungan Sub from The Phantom Menace.
If you are even remotely aware of the Star Wars franchise, then you more than likely know The Phantom Menace is considered by a large majority of the fans as the worst movie produced under the whole series. What makes it even... better? is the fact that the ship itself is related to the most annoying creatures in the Star Wars universe: the Gungans. All of these factors certainly don't help this set's popularity with the SW community, but as the target demographic for this set is probably young kids and teens that grew up under the new trilogy, I can't really say that LEGO made a mistake releasing this set. We just have to live with it.
This version of the Gungan Sub is not the first released by LEGO, however, as they did one way back when the movie was first released in 1999. Below you will find a table comparing the most important statistics of both versions:

You can see above that both sets were are very similar in various aspects. Before I forget, the older version retailed for $50 while the new one does for $70.
Let's now evaluate the numbers that will help us determine the impact the 2012 version had on its predecessor from 1999

I think it is pretty clear from the graph above that the impact of the announcement and released of set 9499 had a huge negative effect on the original version. Set 7161 dropped significantly over the past year (around 38%) and I think most of that drop is as a result of the new version. For a set of this kind that I believe it's not iconic at all, the impact of a having a new and greatly improved version is something that will almost always result in depreciation of the older model. When parents and other customers can go ahead and pay even retail price for the better version ($70) instead of paying the secondary market prices of the old version, they will almost always go with the re-make. This has as a consequence a drop in demand for the older set and a drop in price as well.
In this particular case, the older set took such a big hit that was even selling below the market value of the newer version for a couple of months, coincidentally those months with the highest demand for LEGO. So far, this has been actually one of the most extreme examples I have come accross so far when evaluating set remakes, and I think it goes back to the fact that the main buyer of this set are parents getting it for their kids and not hard core collectors. Once the cheaper alternative was released those parents simply shifted their money towards it and forgot about the older version.
7161 has had a small recovery over the past couple of months, but the damage is already done. I don't see this set coming back up to its pre-9499 levels, and the data should serve as a lesson of why holding sets for a really long time can become a very costly strategy.
Thanks for reading!
Remakes, clones, variants, redo’s, copies, call them what you will but they play a big part in the savvy investors thinking. Especially in the most beloved Star Wars theme. There is almost always a remake or two, or more, in every new wave of Star Wars themed Lego sets that are released these days. In fact it has become one of the common criticisms of the theme across many Internet fan sites and discussion forums.
So what impact do remakes really have on secondary market prices, both on the old set(s) and on the newly introduced one? Is it always a negative impact? And can we predict what sets may be remade in the future?
First we need to look at what sets have had remakes, what is the scope of the issue here? Well if you put the search term “X-Wing” into Brickpicker or another Lego set database you’ll get 12 results of sets with X-Wing in the name. That is a huge amount of sets based around one type of ship. For the scope of this article I’m only going to be looking at full sized models i.e. I will exclude mini-builds, polybags, and the planet series. Information on those could be an article on their own and I want to examine what the effects of remakes are for the larger sets that are more commonly used as investments. Small polybag sized sets aren’t really going to influence a large scale model that much. I’ll also be excluding any set bundles like 65145 as there is insufficient data on those.
Here is a chart showing all the Star Wars remakes I could find:

This shows there are 36 different combinations of remakes, far more than I would have thought. 20 subjects have a twin, 10 belong to a group of three, 4 groupings of four sets, the mighty Millennium Falcon has 5 incarnations, and the X-Wing has a staggering 7 different versions! Hopefully I’ve captured them all, but there may be one or two I’ve missed (sometimes it can be hard to spot a remake if the names aren’t similar). There are also a few grey areas around what exactly should be considered a remake, for example I’ve excluded the 4501 Mos Eisley Cantina from the Landspeeder numbers even though it has a Landspeeder just because I think the focus of the set is wider than that vehicle. There’s also the R2-D2 Technic set with the new UCS model, but I feel they are so different they should be separate.
OK, so how do these remakes affect the secondary market prices of sets? Well it can be a little hard to determine, especially as we don’t have perfect and complete information available. Ideally, we would be able to go back right to a sets’ release date and view monthly current prices all the way. We can’t though. What we do have is the CAGR of each set over it’s time since release as well as rates of return for the last 24 months, 12 months, 6 months, and 1 month, which are based on the current market price changes over those periods according to Brickpicker data sourced from Ebay US. (Data from other Ebay regions have recently been added but will take time to build historical information).
Examining the return rates of sets that have had a remake vs those that have not may provide us some insight into how a remake may affect values. Using 24 month and 12 month rates of return are probably our best option as we don’t have to go back to the release date of a set. Using those measures is also more relevant to current investment trends. Likewise, comparing the return rates of sets that were for example released in 2004 and then 2007 is difficult as we can’t really examine the impact of the 2007 set on the 2004 set. So what I have decided to do is look at all the sets that have had a recently released (within the last 2 years) remake.
Taking all our Star Wars sets released from 2011 and prior that have had a remake in either 2012 or 2013 we have 22 sets across 11 different subjects (vehicle or set types)(also excluded the advent calendar). Looking up all 22 sets and getting their respective 1 year return rates from the awesome Brickpicker tables, we can calculate an average of -8.69% return across them all. That is quite a drop! I then looked up all the rest of the Star Wars sets that have no remakes at all, so have only had 1 set made on that particular subject. There are 138 of these sets and their average 1 year return rate is -1.62%. That means that in the last year their secondary market price on Ebay US has shrunk by an average of -1.62%. (As an aside I was surprised by these negative 1 year return rates, I had to check my data a few times but it was correct. This is a curious result, what is causing it? Possibly Star Wars Lego fans moving into the LOTR theme is one theory I thought of, but looking into that would be a whole other article!).
I also took all the sets released in 2010 or prior and looked at their 2 year return rates (the total percentage gain you would have if you bought the set 2 years ago at the market price and sold it at the market price now). There are 31 different sets across 17 different subjects that have had a remake in 2011 or later. For these 31 sets the average 2 year return rate is 1.81%. Not a great result for 2 years storage time. For comparison, looking at the Star Wars sets that have not had any remakes at all, found 128 sets and their average 2 year return rate was 13.35%.
These results can perhaps be visualized a little better in the chart below:

As you can see, this analysis has provided solid evidence that remakes or clones negatively affects the secondary market price growth of the original or earlier released versions.
Let’s look at some specific examples that should help to illustrate this issue.

The above graph shows prices for the two V-Wing sets. 7915 was released in 2011 and has stopped the price growth in the older 6205 set for a period of time. Looking at raw prices is interesting, but we can examine this effect more closely by taking the growth rate of the set price from period to period i.e. the rate of change from one period to the next in the market price. Lets look at that for the V-Wing sets:

This shows that once the newer 7915 set was released there was a dramatic drop in the growth rate of the older 6205 set. This was alongside the traditional negative growth for 7915 that we see in a new retail set as people take advantage of regular store discounts to obtain the set below retail prices. Both sets then track each other back to more normal positive growth rates in the period from 6 months ago to last month, before both taking a bit of a dip in the most recent price results.
Notes on the above, and subsequent, graphs:
Care should be taken when interpreting the graphs in that the X-Axis (horizontal time period) is not linear. i.e. it does not follow regular intervals. Yearly growth rates are presented up until the “6 months ago” point at which time the gap we are measuring is actually 6 months, then to the “last month” point where the gap is only 5 months, and finally the “current” point which is only 1 month of growth between our current market price and what it was 1 month ago. Often the shorter gaps will have lower growth numbers or tend to be closer to zero, that makes sense as growth over a whole year is often greater (either positive or negative) than just a month. Given the above issue, it is important to note that the purpose of the graphs is to compare between sets, and not necessarily to look at the growth trend for any one set. (If you want to look at one set go to the Brickpicker page for that set and look at the excellent graphs and tables available there). We only have data for the retail price, the 2 years ago, 1 year, 6 months, 1 month, and current prices. Therefore, for older sets, to predict what the price was between the sets’ release year and 2 years ago it was necessary to take the retail price and the 2 years ago price and then average out the price movement across the intervening years. This is almost definitely not accurate, but it is the best we can do unless we take a guess at how a set may dip after release to then rise at EOL, but that will be different for every set. I have shown that difference in the X-Wing graph later on. Data was taken from the May-13 release of Brickpicker data that was for the period ending Apr-13 Lets have another look at another clear example. What better than the aptly named Clone Turbo Tank. Two great sets, 7261 released in 2005 followed by 8098 in 2010, both of similar size and design.

Again, the original set has strong price growth before the release of the remake curtails and depresses it. Looking at the percentage growth period to period it becomes even more apparent:

The new set comes in and it’s greatly received and immediately shows growth while its predecessor plummets before returning to a more normal growth.
Here is a more another interesting example. Looking at just the 2 most recently released Y-Wing sets. The 8037 released in 2009 and the new 9495 released last year:

Because the 8037 set was released in 2009 and most likely was available for perhaps 18-24 months on retail shelves we get a nice view of the dip in price to 2011 for our first available price measuring point. The set goes EOL and immediately jumps 25% only then to have the 9495 come along and take the wind out of its growth sales.
How about when the newly released set is a better model? Perhaps a good example is the recent 9492 TIE Fighter which is an improvement over the old 7263 model.

The old 7263 enjoys moderate growth until the new improved 9492 is released, whereby it drops sharply. The 9492 drops initially as well, providing a text book example of heavy retail discounting affecting the Ebay price. Both sets then recover a little and their growth rates track almost identical patterns. I had expected a bit more of a drop for the old model here though as I think that the new one without the blue colors is so much better, but perhaps I’m a little biased and the general public don’t share that view.
Another good example of an upgraded set is the Imperial shuttle. The recently released and newly retired 10212 UCS Imperial Shuttle has had an impact on the prior 7264 Imperial Inspection that was also a very nice set.

7264 saw very healthy growth through to 2012. The release of the new UCS set appears to have taken a little while to have impacted unlike some of the immediate impacts we have seen before. This may be due to the 10212 being released in the later part of 2010 and not having many discounts for a while. But 6 months ago as retail discounts for it occurred and rumours of its imminent retiring circulated, the increase in demand pushed down our 7264 set and it is perhaps not yet recovered as the 10212 takes off after recent EOL.
OK, lets get a little more complex and check out some examples of multiple releases. The Millennium Falcon has had 5 different decent sized sets released over time. It’s an iconic part of the Star Wars universe and obviously very popular, so The Lego Group have released new version fairly regularly. Also, unlike the X-Wing it is a unique ship i.e. there is only one Millennium Falcon, while the X-Wing is a class of ships with a few different variations. The raw price graph is dominated by the juggernaut that is 10179 the UCS set, so lets just look at the growth percentages:

Things look a bit messy, even after not including the 7190 set from 2000, but upon closer examination you can see the effects each new remake has had on the prior versions. The orange shaded area highlights the most interesting point for which we have good data. This is where the most recent set, 7965, was released in 2011 and shows the subsequent drop in all the sets price growth in 2012. That is for all except the phenomenal 10179, it seems this UCS behemoth is impervious to the power of the clones!
The X-Wing is an even more complex situation, with 7 large sets across history including the recently released 10240 UCS version and another one, 9493, still on retail shelves. Impacts on the very early versions are hard to examine so let’s look at the four most recent sets:
There is a lot of information contained in the above chart. Firstly, I’ve included a dotted path for 6212 which I think gives a possibly more accurate view of what the trend for this set would have been in the past. As I’ve already stated, we only have the retail price and the 2011 price as markers to go by, so drawing a straight growth line between them is the most consistent thing we can do. But there would most likely have been a drop after retail release reflecting discounting, before recovering and moving into high positive growth after EOL. The size and timing of the dip and recovery will differ between sets a bit though.
Second, the blue shaded area shows us that when 9493 was released there was an associated drop in price growth for the existing 6212 and 4502 sets. Thirdly, when the 10240 was released last month there was a sharp drop in that next most recent 9493 set and a slightly smaller one for the old 4502. But the 6212 has recovered a little and this shows it may come back to a more normal growth trajectory. It will be interesting to see how this plays out in future months as the new 10240 UCS set continues at retail and the 9493 goes EOL at some stage. It would also be interesting to look at the effects on the other UCS X-Wing 7191 set once we have more time periods.
In summary I think the evidence is very clear that remakes do indeed affect the secondary market price of the older versions. The magnitude of that impact is perhaps hard to tell at an individual case level as there are other contributing factors such as:
The age gap between the remakes Is the set very similar in size and retail price as the original – probably increases the impact Is the set an improvement on the older model? Retail discounting of the new set UCS sets possibly immune, or at least far less influenced? Is the theme itself, or the Lego market in general, on the decline, or experiencing a soft spot in growth? On average though it would appear that that remakes effect values by lowering growth by around 6 to 7 percentage points per year for a couple of years before recovering to more steady, but lower, growth paths. Over time we will have more data that should help us judge the materiality of the suppression of longer term growth.
Future Clones?
Can we use our knowledge of past remakes to perhaps predict what sets that Lego may decide to do a remake of in the future? This would help us make investing decisions either by avoiding possible remake sets or by not holding them for too long.
The Star Wars theme is quite mature, there are limited options available for new ships, vehicles or settings on which to base a Lego set on. There are a few, but they tend to be from more obscure parts of the Star Wars universe and don’t have the wide appeal that well known iconic subjects do. The saving grace may be the new Star Wars movies being made by Disney, which should open up a lot more possibilities, both for new set subjects and for remakes of old ones that make a new movie appearance.
Also it would seem that the very iconic ships such as the X-Wing, Millennium Falcon, and to a lesser degree the other “Wing” type fighters, Slave I, Walkers, and Shuttles all seem destined to have regular remakes. I’d be hesitant to hold onto any of those models that weren’t a UCS one for any long length of time.
Of the currently remade models presented in the first table we can look for sets that have been remade before but the latest version is now getting a bit old. The AT-ST, Snowspeeder, Jedi Starfighter, and TIE Interceptor are all candidates for a possible new model.
Looking into the other Star Wars sets that have not had a remake may throw up some possibilities. I have gone through 136 sets in this category and here are a few likely candidates in my opinion:
C-3P0 Cloud City Darth Vader Gungan Patrol Mos Eisley Cantina MTT Rogue Shadow Sandcrawler Stormtrooper TIE Bomber TIE Crawler TIE Advanced Trade Federation AAT No doubt I’ve missed a few and Lego are never that predictable when it comes to future releases, but I think there exists a decent possibility that we’ll see sets based around some of those subjects again.
Remakes occur for a reason. The Lego Group puts a lot of time into deciding new sets and bases a large part of those decisions off previous sales demand. Remakes are usually done on popular subject material and therefore have higher demand, leading to higher demand on the secondary market. Set subjects of only one model are usually more obscure and have less general appeal, so should in theory have less demand. A classic case of supply and demand at work. Higher demand leads to higher supply, which suppresses prices in the secondary market. Imagine if there was only one X-Wing model ever released, the secondary price for that would be astronomical!
So in conclusion, beware of those clones! Wise investment decisions should be based around as much knowledge as possible, and the knowledge that a new set is about to come out based on a subject that is the same as one you have stashed away in the form of an earlier version, means you should seriously consider liquidising your investment pronto. Don’t get hit by an attack of the clones!
In the world of finance, investors are usually interesting in measuring the performance of their portfolios against a benchmark or to at least compare them to some of the other investments they had available at some point. Doing this analysis is extremely important, as it is the only way to determine how your personal investments have done relative to some others in the market. For example, say your portfolio produced a return of 20%, I am sure most of you would be happy with that number and would ask no more questions, but just think of how different things would be if you knew that the return of the overall market as measured by the S&P 500 was 30% (I am using exaggerations to make the point more visible) your portfolio would then have underperformed the market and instead of happy you probably would be kicking yourself!
Relative performance is a very important aspect to keep in mind when investing, as you see from the example above. Now, there is one other thing that we should take into account that takes what I explained above one step further. Let's now assume your portfolio returned 32%, while the market had a return of that same 30%, in this case you can accurately say that your investments outperformed that of the overall market. Having said that, let's also assume that the standard deviation of your portfolio was 50%, while the market's was only 25%. What really happened in the end is that you took double the risk to capture just a 2% of extra return, and to me that is a mediocre extra return for such a high extra risk.
How can we then adjust for risk and make our performance evaluations more accurate? one way is to use what is known as Sharpe Ratio, or reward to variability ratio. What this very simple to calculate ratio can tell us is how many units of return we receive for each unit of risk we took with our portfolio. This measure is a great way to compare investment portfolios relative to the risk taken, and I believe we can also apply it when investing in LEGO.
If you read my previous Blog Article, you know that we can calculate standard deviation for LEGO themes or set types and come up with the respective volatility. The Sharpe Ratio measure uses this same calculation to account for risk, while at the same time including the expected, or actual, return and the risk free rate. On the next examples I will assume we have already calculated standard deviations for each theme and, for simplicity, that the risk free rate is only 1%.

So, in 2013 Ninjago and CITY's return was 25% and 10%, respectively. The risk of each measured as standard deviation was of 12% and 4%. What follows is the formula to calculate the Sharpe Ratio (Image from Investopedia)

As you can see, the calculation of the measure itself is pretty simple, and only what comes before is what can get tricky at times. Applying the formula to the numbers presented above we get the following results:

So what these numbers tell us is that, even if at first sight a Brickfolio focused on Ninjago in fact produced higher percentage returns, it is the CITY Brickfolio the one that presented the higher returns on a risk adjusted basis. Basically, the Ninjago investor was able to secure 2 units of return for each unit of risk, while the CITY investor produced 2.25 units of return for each unit of risk. Another read that you can make is that the Ninjago investor was not compensated as well as the CITY investor based on the risk taken by each.
A very basic rule of thumb when using this measure is that a higher ratio is preferable to a lower ratio. Also, as mentioned earlier, there is no need for you to wait until you have the actual returns of your Brickfolio, as you can also use your expected returns in place of the actual return as a way to compare possible future outcomes.
The Sharpe Ratio is not, of course, the end all of performance evaluation measures, but I think that it is simple and accurate enough as to be used even by the casual LEGO investor without getting into way more complicated methods. I believe that with any serious investment it is very important to evaluate as many factors as possible, and risk is certainly present even when taking about LEGO bricks. A long term investment strategy is strongly suggested, and by using Sharpe Ratio, Standard Deviation and by determining your goals early in the game (Check out Adewar's blog on viable investments and how to determine your own objectives) I think you will be a step ahead most people.
Note 1: Attached you will find an Excel spreadsheet showing the calculations used for the example in this article.
Note 2: Returns calculated by Sharpe are excess returns.
Thanks for reading!
 
Sharpe.xlsx (9.69KB) : 10
"Marty, we need to go back! Back to the Future!" - Doc Brown In 1985, the first movie of the blockbuster trilogy Back to the Future was released to accolades. It quickly became an 80's classic movie with kids and adults alike routinely quoting famous lines from the movie. From Bif bellowing "McFly!" to Doc stammering about flux capacitors, this movie quickly worked its way into pop culture, and today it stands as an all-time great.
Imagine for a moment that we were actually able to time travel. As a Lego investor, the first set I would travel forward in time to learn about would be 10227 B-Wing Starfighter, the single most debated set on Brickpicker over the last six months. The B-Wing is a Lego Star Wars Ultimate Collector Series model of one of the lesser known Star Wars starships of the Original Trilogy. This model has created so much controversy because of its perceived unpopularity prior to an unprecedented 50% off sale that resulted in a dramatic run on this set. An unheard of discount, a short sales duration, and a relatively fragile build of an unknown starship has conspired to create a flumoxing mix of competing positive and negative secondary market characteristics. I want so badly to see how this set performs because it really has the potential to explain so much about the secondary market, and what characteristics are important to secondary buyers. If there is a Rosetta Stone of Lego investing, this very well may be it!

To make an educated guess where the B-Wing is going, we need to remember where the B-Wing has been. Let's hop into our ugly CUUSOO Delorean and set the clock to July 6, 2012, the day Lego officially announced the B-Wing's release. Apparently, TLG was particularly successful keeping the lid on the B-Wing's development, so there was little indication this starship was in development among the Lego community. It's announcement and subsequent unveiling the following day at Brick Fiesta in Houston, Texas caught many fans by surprise. Soon after it's announcement, information began to leak out about the B-Wing to Lego fan sites and the first comments began to surface about the B-Wing. Unfortunately, a chorus of disappoinment in the set's MSRP and the absence of an exclusive minifig was heard, so the B-Wing was off to a rocky start. For reference, here are the initial MSRPs by region according to TLG's official press release and their respective price per piece, one of the oft cited metrics from the B-Wing's initial complaints:
$200 USD, $0.13 per piece
$250 CAN, ($255 usd), $0.17 per piece, 27.5% over US price
€200 ($246 usd), $0.17 per piece, 22.9%
170£ ($263 usd), $0.18 per piece, 31.5%
1700 DKK ($281 usd), $0.19 per piece, 40.5%
Back into the Delorean, we fast forward to B-Wing's release October 1, 2012. The buzz around the set was largely muted: a few still complained about the price point, but the few reviews coming in were largely positive, especially from Star Wars fans. It didn't appear there was a lot of excitement about this new UCS set, and with Death Star, Super Star Destroyer, Imperial Shuttle and the R2-D2 models crowding it out, the B-Wing perhaps got lost in the shuffle of a strong group of Ultimate Collector Series "large scale" models.
Then came May 4, and the epic B-Wing promotion from Lego. On the evening of May 3, the night before the TLG's yearly Lego Star Wars promotion day, Brickpicker officially announced at 8:00 PM EST that Lego would be discounting 10227 B-Wing by 50% in the United States. This set off a deluge of anticipation within the Brickpicker community, and on midnight of May 4, 2013, TLG posted the B-Wing for $100, a full $100 less than MSRP. Within forty-five minutes, the B-Wing was sold out and a torrent of posts flooded Brickpicker's forum containing a spectrum of responses. From one member who bragged about purchasing 11 B-Wings to others who castigated the BP community for not allowing children the opportunity to have their very own, most of the responses were intense. It seemed no one had anything less than visceral reaction to TLG's discount.
The obligatory eBay postings arrived the morning of May 4, with the typical listing anywhere from $100 to $300, atlhough there were a few 'Buy it Now' prices that listed 10227 for four figures. During the entire month of May, eBay Lego listings were dominated by this previously quiet set, with a total of nearly 300 sets sold, a 1,000% increase in listings from the previous month. Yet, as the calendar flipped to June, the listings have slowed again, and Lego resellers have largely moved on to other sets. As of June 24, 68 NISB B-Wings had sold in June, a fraction of May's total, and only 39 more than were sold the month prior to TLG's B-Wing's discounting.
A few short days ago, Brickpicker members saw that 10227 B-Wing was listed as "Call for Availability". This tag is, at times, a precursor to full blown retirement. Later, Lego updated their listing to include some stock, yet the retirement speculation had begun. Was B-Wing gone? Today, a look at Brickset's B-Wing listing shows a June 17 retirement date for the US and Canada, with the set still available in the United Kingdom. The US Lego S@H listing shows the B-Wing completely sold out with no restocking date. Brickpickers take note: these are some strong signs that indicate B-Wing's official retirement is now on the horizon.
So what does this long, strange trip mean for secondary sales of the B-Wing? First, if the B-Wing is officially retired, we can confirm earlier speculation that Lego's discount was in fact a clearance sale intended to eliminate B-Wing stock. This is potentially valuable information that could establish a precedent for future large discounts by TLG. It's probably a pretty good indication that if a given set is discounted 50% in the future, it's likely the beginning of the end for this set.
That said, we still need to estimate how this set will perform from here on forward. For reference, let's once again show how well the UCS have performed:

This subtheme's performance has been rehashed time and again, yet the numbers don't lie. Apart from 10215 Obi-Wan's Jedi Starfighter, these sets have all performed really well after retirement. However, when you look at 10215, there is a concerning similarity between it and B-Wing: it's price per gram is VERY similar. Fortunately, the table also shows us another strong earner, 10026 Naboo Starfighter, that sports an even higher price per gram so I don't believe there is any correlation between price per gram and secondary performance for UCS secondary market performance.
Remember that secondary performance is typically the result of retail popularity and retail availability. While sales are the ultimate measure of set popularity, Lego doesn't release sales statistics to the public so it's difficult to get compare the B-Wing's popularity to other UCS sets. However, to gauge retail availability, we can take a look at the number of months these sets have been released. Per Brickset's release/retirement dates, here are the sales durations for UCS sets they have on file:
10221 Imperial Star Destroyer - 22 months (and counting)
10212 Imperial Shuttle - 27 months
10186 General Grievous - 12 months
10179 Millennium Falcon - 30 months
10174 Imperial AT-ST - 17 months
10175 Vader's Tie Advanced - 15 months
10143 Death Star II - 16 months
Assuming a quick retirement like Brickset anticipates:
10227 B-Wing - 8.5 months
That's a really short sales duration for any set, and almost half the duration of every set on the list above except 10188. As a comparison, the explosively popular 9465 The Zombies was out for just over 4 months. Even though B-Wing has been around twice as long, it's still within 4+ months of The Zombies sales cycle. If it's true B-Wing is retiring, it will have the shortest sales cycle of any UCS set.
The natural response to B-Wing's short sales cycle is that it wasn't popular, so it didn't sell at MSRP, and will therefore not garner very good secondary sales. While this may turn out to be true, most people that invested in B-Wings did so during the May the Fourth promotion when retail was $100. Everyone in this camp should be poised to make a nice return on their investment. Here is a table with the B-Wing's ROIs at specific secondary sales points assuming a $100 purchase price and a $200 purchase price:

If you review recently sold eBay listings, the typical sales price (without shipping) is anywhere from $135-150. So, the first sales price I included was $150. As you can see, for those that bought at $100, you are almost guaranteed to make money, and could be poised for big profits if B-Wing performs like the rest of the theme. Unfortunately, the other side of the coin is those buyers that bought B-Wing prior to The Sale. As the the table shows, a B-Wing purchased at anything close to MSRP is in danger of breaking even, or possibly losing money.
Where will B-Wing eventually end up? I think the 10212 Imperial Shuttle is an adequate comparable to assemble the B-Wing's return model: both sets sold at roughly the same rate on eBay while they were available at retail, fluctuating between 25-50 sales per month, both sets are similar in size and cost, and both are Ultimate Collector Series models. While B-Wing is probably less iconic that the Imperial Shuttle, neither ship was a true Original Trilogy icon. While IS is probably slightly more popular, B-Wing has a lower MSRP, so if these aspects balance they should provide similar ROI. Assuming IS's value climbs $10 per month for the foreseeable future, 10212's secondary market value is likely to reach $400 before the end of the year, pegging it's first year ROI at roughly 50%. A similar gain by B-Wing would peg its value at around $300 on or about July 1, 2014. Since this seems a little high to me, let's back off a 50% return over MSRP and forecast a 50% return over it's ideal sale price of $150-175. That would bring secondary market buyers at a $100 purchase price a return of 30-50% after transaction costs.
10227 B-Wing did not take the traditional path to EOL, and because of this it could become a very illustrative set for secondary market investors. The eventual plateau value of the B-Wing should provide some insight to the following:
How do significant (50%) discounts by TLG affect post-retirement performance? Will the Ultimate Collector Series subtheme continue to show across-the-board success, or could future subtheme sets be invesment failures? Is there any correlation between strong set launches and future secondary performance, or more importantly, weak model launches and corresponding secondary failure? More broadly, what is the effect of momentum, or lack thereof, on the secondary market value of a Lego set? Unfortunately, my sports almanac doesn't contain any Lego secondary market values, so I will have to get to work on my own Mr. Fusion flux capacitor. Or, perhaps I will just wait to see, along with everyone else, how the future unfolds.
And as always, invest accordingly.
When LEGO investors evaluate a given set, they ask themselves, is this investment viable? Is it worth putting my hard earned money into? But, what does viable mean exactly? Is it anything that nets more than the inflation rate or the supposed risk free investment rate of US treasuries (let's not debate if treasuries are truly risk free)? Probably not. We all know there is a certain element of risk involved in LEGO investing that should command some risk premium, but what should that risk premium be? Fcbarcelona101 points out in his very insightful blog, that even among various LEGO themes, risk can vary greatly.
Other questions may be, Can I flip this set today for a quick profit or should I hold on until EOL or hold until the community standard of EOL + 2 Yrs. What time frame should I expect to realize a return on my investment? What level of growth should I expect from a given set? If I have a limited budget and a high tolerance for risk, should go for that one home run? What are my goals? The answers to these questions and ultimately the question of what makes an investment worthwhile are going to be different for everyone. There a lot of factors involved. Many investors prefer to deal in large sets which can net $100+ in one sale while others are content to deal in volume and sell polybag after polybag for a net of $3 each. We all have to evaluate our budget, storage space, and the amount of time we want to devote to this hobby/job/casual pastime among other things. Many of these factors are difficult or impossible to quantify.
However, in an effect to quantify what can be quantified, I put together a calculation in the attached spreadsheet that encompasses the most relevant variables that I consider when deciding to purchase a given set. It is not meant to be all inclusive, for example it doesn't include a risk factor which I think would be a very nice addition. Here it is, perhaps it will be useful to some:
The fields which are intended for the user to populate are highlighted in yellow:
MSRP - Enter price paid
Hold Time (Yrs)
Time Value of Money Discount Rt - Enter the annual return you expect
Transaction Cost - Enter the % of the final sale price lost in transaction costs
Sales Effort - time involved in the investment (buying, listing, selling, shipping) entered as fraction of an hour
Hourly Rate - How much is your time worth to you or the amount of money per hour you would need to make if your transaction were to net '0' and have it still be worthwhile.
The resulting output gives:
Future Value:
Net Return
Worthwhile?
 
LEGO_Investment_Calc.xlsx (11.18KB) : 37
Welcome to my Top Ten Best Selling Sets section for the month of May. This will be the first of a series of articles dedicated to examine some of the purchasing trends as shown by eBay data collected by Brickpicker every month. My aim is to publish one of these as soon as each month's update is completed by Ed/Jeff and show the users of the site some of the most popular sets so that they can use it as a guide about what is hot at any particular month. Hope you find it useful.
May 2013 Top Ten

1- No surprise in the first spot when you remember that this month's data includes the period before, during and after the May the 4th promotions. The 50% off the B-Wing guaranteed that a very high quantity of customers would end up purchasing the set in differing quantities with the intention to build, invest or flip in the short term. The low price for which this set is selling at the moment relative to its high MSRP may earn it a spot in the Top 10 for at least a couple of months.
Change from previous month: +165 Places

2- The popularity of this set even after the initial craze and subsequent increased production allows it to stay in the top ten for yet another month, and so far it has been there for at least December 2012. Price continues to drop, as do overall sales, but the fact that it still is in 2nd place prove just how popular this set has been.
Change from previous month: +3 Places

3- This is yet another set that comes as no surprise, as it constantly hovers over the top spots in the best sellers list. The Millenium Falcon 7956 is expected to retire relatively soon, and considering this is the best version released as of today, ignoring the UCS 10179, it is sure to be a great performer in the secondary market. The set moved up 9 places, a leap that can be attributed in part to the May the 4th sales and promotions.
Change from previous month: +9 Places

4- This is one unique set that usually does not get talked about much in the forums, however it continues to demonstrate month after the month that it is one of the most popular available. According to Brickset, the set has been Sold Out at S@H since the end of April.
Change from previous month: +12 Places

5- For those of you that still have doubts about the popularity of the Friends theme, this little set has managed to capture the #5 spot of this month. Released in February, it is one of the newest sets of the theme, so that may account for the high number of sales it has experienced.
Change from previous month: +45 Places

6- This relatively new battle pack is getting very popular, very fast. The quantity of sets sold has been increasing by A LOT since its introduction, with sales this month surpassing April by 77 copies.
Change from previous month: +95 Places

7- This Chima Speedorz is one of the only sets I really wish I did not see in this list. If you remember, LEGO included this set as a freebie in pretty much every single order that went through. Of course, people then turned around and listed them on eBay with the expectation of making a few bucks on them. As one would expect, price continues to drop. Even more, this is the largest jump relative to the previous month, something that goes a long way to show just how many of these little things are now floating around.
Change from previous month: +933 Places

8- The eternal Death Star jumped several dozen places even with it very expensive price tag. Most of this jump can probably be attributed to May the 4th as well. The advertising by LEGO probably spews out towards other selling outlets.
Change from previous month: +45 Places

9- After one month in the second spot product of the "early retirement" confusion, sales of the Palace dropped significantly from 937 to "only" 96 copies in May. Still, the set maintains a position in the Top 10 and it will be interesting to check where it will be next month.
Change from previous month: -7

10- To close our May list we have yet another 2013 Star Wars Battle pack that jumped more than a hundred places relative to the previous month. These things are very affordable and great army builders, but why this particular one jumped so much ,other than because May the 4th and its recent release, is beyond me.
Change from previous month: +123 Places
And with that, we close this month's Top 10 best sellers list. If you are interested to check out the complete list, click here and you'll see the Top 50 best sellers according to eBay data.
See you next month to evaluate June's Top 10!
Cars, trains, planes and ships, what do all these transportation methods have in common? They usually start depreciating the very moment you use them for the first time, especially so with cars but also true of all the others. In the LEGO world, however, the opposite is most often the case.
There is usually a lot of talk in LEGO forums about the great appreciation usually shown by train sets, and that is something that can’t be ignored, but it sometimes makes me think that we are overlooking or at least under valuating the performance of ships, planes and cars, that as I will show a little later in this article are usually at least as good as the best LEGO trains. There is something about scale models of these transportations methods that has always attracted attention in large groups of people, and LEGO has obviously noticed.
In this article I will try to showcase the performance of each of these classes, but first let me draw you some sort of map so you know what to expect: First we will be taking the road while we talk about some of the best performers in the four wheel universe, we will then park our vehicle at the piers where we will be boarding onto the top performing ships of LEGO history. Once we disembark, we will be buying our train tickets (direction: airport) and have a little talk about the largest, and best performer, trains in the LEGO world. By that time, we should be in time to catch our plane and return to our starting point once again to complete the trip. As if all this were not enough, I’ll leave you with a comparison and ranking of all these transportation categories as well as an analysis of the current investment options available to you in this regard.
Let’s begin our journey.
Road Trip
Cars, trucks and other vehicles have always been of interest to a large amount of the population. Take the success of other toys like Hot Wheels, scale models and even real car collecting as evidence of the interest this transportation method generates in people.
When we talk specifically about LEGO vehicles, we have to focus a lot more in those from the Technic line, as they have usually been the largest and best performers over the course of the years. Let’s take a look at the Top 5 LEGO vehicles that have been retired so far.
8421 Mobile Crane

*No Description
Found* Comments: The second largest vehicle ever produced by LEGO, and part of the Technic line. This set is huge with close to 2,000 pieces and a very interesting model as well. Driving this thing will probably not get you very far at a fast rate, but it has definitely proven to be a fast grower over the years. There is little activity on this set (New) on eBay, with the last one being sold in April of this year for the amazing price of $ 725! As with all Technic builds, there is a lot of functionality in this set and it seems to have gone well under the radar.
8258 Crane Truck

An exciting and challenging building experience with this 2-in-1 real world model! Try the functionalities with the included Power Functions XL Motor, Power Functions Battery box, and Power Functions Control Switch! Power Functions powers the crane arm and extendable outriggers! Crane unfolds , raises and lowers and swivels 360°! Cab opens to reveal interior details and V8 engine with moveable pistons! Rebuilds into Duty Wrecker! Crane measures 20.9 inches (53cm) x 22 inches (56cm)! Comments: Another Technic build, another crane type set. Came with Power Functions to make some of the nice features included work, and even had some pieces made completely out of rubber and metal instead of traditional plastic. You could even download a different set of instructions and completely change the looks and functionality of the model, so you were basically getting two different sets for the price of one. This set is more recent than the Mobile Crane, and as such has a lot more activity per month on eBay. The price seems to be moving up steadily every month as well.
8285 – Tow Truck

 
Comments: And big trucks continue to dominate the list, just like they do in the real American car marketplace. Really good looking tow truck, and being a Technic set, it does come with its fair share of motorized and other functional features. As with the previously discussed model, this set also had a second set of instructions to transform into a flatbed truck. This Tow Truck was originally released in 2006, just one year after the Mobile Crane, and shows a similar level of low activity on eBay as a consequence. The last two new ones sold for over $ 700 as well, but with such a low amount of data is really hard to tell what their real market value is at this point. Another under the radar set at a time when LEGO investing was not really in full gear. Another great Technic investment.
5571 Giant Truck

*No Description Found*
Comments: Released in 1996, this is the oldest set of this Top 5, and the first one that is not a Technic build (it IS another truck though). A real vintage piece, this truck is one of the earliest examples of a real LEGO display piece the company has us accustomed to as of late. Not only was one of the largest models of the time, if not the largest, but it also has been proven to be one of the top performers of this list. With a surprising 9 % CAGR still after more than 16 years of its release and at least one new set sold for the last 6 months, this set has nothing to fear from any of the other larger trucks talked about above.
One thing to note, the set suffered from a significant drop in value in the last month, but considering for how long this set has been retired, I would assume that those are just typical price fluctuations that will average out in the end.
10187 Volkswagen Beetle

Comments: And so it’s the last set of the list, and the only one in the Top 5 that is not a truck or a Technic build, just a “regular” passenger car. The VW Beetle is one of the most popular and easily recognizable cars in history, thanks to its particular design, and LEGO’s agreement with the automaker has made it possible for fans to build their own. Even more, this car model was chosen by real LEGO fans, so its popularity was to be expected.
Released in 2008, this mostly blue model has presented a very fast level of growth, with a CAGR of over 30.5% and also an increase of almost 3 % over the past month. The Beetle has been growing steadily every month, and at $ 455 already, it is 280% over its original retail price in just a couple of years.
Honorable Mentions

I think there is no need for me to add any more information, am I right? LEGO cars and trucks have proven to be extremely good performers in the secondary market, so don’t doubt about getting a few of them. These will always be popular, and that makes the price go higher and higher. Definitely a better investment than a real car, if you ask me.
Set Sail…
Lego Ships are one of the most talked about and successful investment choices you can make in the LEGO universe. Ships are one of the oldest methods of transportation in human history, and they go pretty far back in time when talking exclusively about LEGO as well.
Most of the time, the company has decided to go with the sail boat type of ship, instead of more modern designs, probably because they look so much better when transformed into bricks. As you will see, however, there have been several profit makers of both kinds.
Also, unlike in the cars/trucks category, LEGO ships performance is not so much linked to a specific line or theme. The variety of themes included in the Top 5 and Top 10 is rather interesting, from Pirates, to the licensed Pirates of the Caribbean, and even a couple of Maersk vessels.
Let’s now go ahead and dive into specific sets:
 
10210 Imperial Flagship

Comments: The largest and, in my opinion, most amazing ship LEGO has ever produced. The Imperial Flagship is part of the generic Pirates theme, but it does not look that most of the previous sail boats, as this one is extremely realistic looking (both inside and out). The ship was also a LEGO exclusive AND also including 9 cool minifigs, so it pretty much had everything going for it. At this point, it has been retired for a little over a year and is already getting close to doubling in value.
The Imperial Flagship is the Holy Grail of LEGO ship investment, and I think it will be a while before we see another model that can even compare with it, both in size and realism.
4997 Transport Ferry

Comments: I told you there would be a lot of variety in this Top 5. This Transport Ferry set was produced in 2008 under the Creator theme, so it actually allows you to build three different models: a hovercraft, a cargo plane and the ferry. As with most sets in the Creator line, the price per piece is a real bargain, and at a low MSRP of $ 70, this was a set that you would have been able to stock up without real trouble. But now is too late, this great looking Ferry is already over MSRP by more than double, but suffers from the same issue some of the cars and trucks we talked about before do on the secondary market: there is just not much activity with this set. In fact, there has not been a new one sold since November of last year, according to Brickpicker’s data, so there is really no way to know how much this set is changing in price on a per month basis. Still, it has already appreciated a lot, and from the current listings available on eBay, it could be going by $200 in some months.
4195 Queen Anne’s Revenge

Comments: And the first licensed theme makes its appearance. With Pirates of the Caribbean being such a successful franchise, one would expect that all of the LEGO sets released under it would shoot up in price after retirement, but this has not happened. The two exceptions are, of course, the two ships that LEGO released, one being the Black Pearl, and the second one this Queen Anne’s Revenge. The Black Pearl was not large enough to make it in this Top 5, but its performance is extremely similar to the QAR.
This ship is another great example about why are sail ships so popular with LEGO builders, as they look really great once completed. Besides that, the QAR also included 7 high quality minifigs related to the movie series, as well as an interesting number of cool play features. At this point, the ship is experiencing the high growth period usually seen after going EOL, and is bound to double in value in relation to MSRP before the end of this year.
10155 Maersk Line Container Ship

Comments: (Re-release of 10152) Maersk licensed LEGO set is something you’ll be seeing plenty in the following lists, they are just some of the most popular sets on the market, probably because it gives a lot of realism to the set and your collection by having a world recognized brand like Maersk. Having said that, this is not a heavily detailed and nice sail boat, but rather a ship designed for the hard and dirty work of moving containers across continents, and to that extent it is a very good looking ship. The brick built containers are one of its nicest features.
Investment wise, this set has done a great job in the secondary market, though not as good as its older and less good looking sibling. Still, this one is a more recent model that lasted very little time on the shelves, so there is still plenty of room for more growth. It also was a lot more expensive than the previous version, so that is something you should consider as well. Another interesting fact that we can gather from the price guide information, is that despite the ship being somewhat active on eBay, it has been dropping as far as market value is concerned for already two consecutive months (New). While this may be a temporary trend, one has to wonder if the set has already reached its peak.
10152 Maersk Sealand Container Ship

Comments: If before we were talking about its newer, bigger and more impressive relative, now it’s time for the original Maersk Container ship to be in the spotlight. Unlike 10155, this version was released way back in 2004 at a much lower price (both MSRP and per piece) but with a very similar feel. The new one has some improvements, but overall you would be hard pressed to find really significant differences.
What’s more important is, that despite having a lower activity level than the newer version, this set has already matured and has even grown some more in the past few months, staying very consistently above $ 190 without much variation. With an original investment of $ 75, you are probably very happy with how this one turned out if you were already into LEGO investing by that time.
Honorable Mentions

So, there have been fewer ships than cars/trucks over LEGO history, but as you can see all of the ones in this list have had a performance that rivals that of any set we talked about on that previous section.
Along the Rails…
Trains are investment winners. How many times have you read that phrase in the forums? Probably a lot, and for good reasons. If you are just entering the LEGO investing world for the first time and are a little wary of the whole thing, one of the safest investments out there would be to put your money towards a LEGO train purchase. These things, besides being appealing for the average LEGO fan, are also incredibly popular with the more broad train collecting population. Train enthusiasts, even if they are not really fans of LEGO, provide the secondary market with an influx of buyers that some of the other themes out there can’t compete with. Trains are just THAT popular. Even more, LEGO has been able to produce brick built trains that actually run over rails, allowing for so many more displaying and playing options to be available.
Over the years, LEGO has produce a large amount of very high quality models, going from vintage and traditional, passing through cargo trains, to the current high speed Horizon Express. Let’s go ahead and take a detailed look over some of the most important ones.
10219 Maersk Train

Comments: Another Maersk themed set gets to be in a Top 5. This recently retired model has been appreciating very fast over the past few months, even though it seems to have hit some resistance these past weeks, nothing major considering how fast this one went up. The Maersk train is the largest train, piece wise, ever produced by LEGO after the recently released Horizon Express. Really compatible with both previously discussed container ships, this great looking model is aiming high, and will probably be worth double MSRP in less than a year.
10194 Emerald Night

Comments: An old-school looking train, the Emerald Night has been a real star on the secondary market. A LEGO exclusive, this model was reasonably priced at only $ 99.99, a great deal relative to the high quality set you got from your money, considering it also was open to motorizing. This great looking model has already more than doubled in value and despite a drop in value in the month of April, from the last eBay sales it looks that this set will continue to show continued growth over the rest of the year.
10183 Hobby Trains

*No Description Found*
Comments: Why limit yourself to only one train design, when you can just build several of them with the same pieces? That was the idea behind the 10183 Hobby Trains set. You purchased a set with over 1,000 pieces that would allow you to create several different train designs at your leisure, without having to be “married” to one specific design. In a way, this set represented the original purpose of LEGO bricks, bringing creativity out and allowing you to build several different things with pretty much the same standard bricks. Anyway, as well as being one of the most interesting sets LEGO has ever released, in my opinion, the Hobby Trains has proven to be another investment winner, going over MSRP by almost 136 % and showing a steady growing trend.
10173 Holiday Train

Comments: Of all the trains in this list, this is the definite Star. The 10173 Holiday Train was a Special Edition released by LEGO for a really short period of time back in 2006; it probably lasted less than 4 months on the shelves. On top of that, the train is themed to the holidays and that usually means a higher price in the secondary market, kind of what happens now with the Winter Village sets. A lot of people like to set up their holiday towns, and how could they complete theirs without an appropriate train set? This is the set that filled that need during the 06 holiday season, and that continues to be in really high demand by many LEGO collectors all over the world. MISB listings for this set are very rare, even on eBay, and it seems that every single December the set jumps in value to a new record high, where it will stay pretty consistently until the next holiday season arrives. This is the very definition of a train investment winner.
4565 Freight and Crane Railway

*No Description Found*
Comments: Another LEGO vintage set that has managed to do very well over the years. The first thing that may come into your mind when you first see this set is just how much LEGO has been improving the set design over the past decade, but by 1990s standards, this set was the top of the line. Running on a 9V track, this train not only has a lot of charm, but also a pretty decent performance in the secondary market.
Honorable Mentions

You see, it does not matter if they are new or old, or vintage if you prefer that term, most large LEGO sets have been really good performers over the years, and I am leaving a lot of them out of these lists just in the interest of not over extending the article, think some of the World City or newer City trains, and some of the Santa Fe cars as well.
Finally, prepare for takeoff…
And just like that we get to the last category I will be analyzing in this article, planes. Pretty much as it is with all of the other transportations types, planes have a market that usually goes beyond LEGO fans, with a large group of people being collectors of all types of plane models.
LEGO planes are not as large of some of the other sets in the others categories, with some exceptions, and there also seems to be a fewer number of pure plane sets when compared to cars, trains and ships. Let’s see some of the highlights.
10177 Boeing 787 Dreamliner

Comments: The Boeing 787 is the largest plane LEGO set ever produced, and as such it also has some of the largest gains in this list, already over retail price by 287 %, and slowly growing even more. Unlike some of the sets I will be talking about after this one, the Boeing is a complete collector’s and display piece, even coming with a display fact sheet on the style of SW UCS sets.
10124 Wright Flyer

*No Description Found*
Comments: Such an iconic moment in history needed to have its own LEGO recreation. Released in 2003, the Wright Flyer is a set any serious plane collector will probably want to add to their collection, and they will have to pay a pretty high price at this point. The set is really rare to see on eBay, with only 3 new ones currently listed for sale at prices way above the Brickpicker Price Guide, something to be expected with sets that do not “trade” that much.
10024 Red Baron

*No Description Found*
Comments: A cool looking red propeller plane released back in 2002. This is another case of not enough activity to really determine the current market value of the set, but even if we base blindly on the price guide, the set presents a pretty good CAGR for the amount of years it has been retired so far. Just as a reference, the last 2 sealed sets sold by $ 300 and $ 350.
 7628 Peril In Peru

Comments: An Indiana Jones plane that includes some other minor features, this pretty cool looking plane has doubled in value in a little over two years with a pretty good CAGR of 15%. It did have a drop in price last month, but if you see the trend, it is clearly a positive one. It may not be one of the greatest winners, but it has done pretty well.
3451 Sopwith Camel

*No Description Found*
Comments: The predecessor of the current 10226 Sopwith Camel, 3451 shares a pretty similar structure (after all, it is the same plane) with a different color scheme. This older version was a little less detailed than the current Sopwith, and that allowed it to have a lower price. The 3451 moves a couple of new sets a month on eBay, but has been on a slump for a while now, that inherently enough started a couple months after the newer version was released. From that point it went from a peak of almost $ 170 to its current value. Not a huge drop, but it is somewhat significant.
Honorable Mentions

There you have it. Planes are much more modest in terms of size, quantity and even growth, with the most recent CITY sets presenting the best numbers of the last few years. Still, as you see from the lists above, most sets have appreciated very well in the secondary market.
Before going into the few sets currently available for investment in these categories, I wanted to give you some numbers to compare all the larger transportation LEGO types, and see how they rank historically based on the sets on this article. Please note that these numbers should be used only as a guide, since we are comparing differently sized sets, released over a long period of time that have also been retired at very different times.

Pretty interesting results, right? It would appear that from the sets we showcased above, the best transportation LEGO sets are those that are in the Ships category and by a very decent margin too. They are followed by Cars and Trucks, then Planes, and finally Trains. It follows that, if Trains are investment winners, then pretty much all other transportation type sets are as well. Of course, there is one caveat in this analysis. We have only analyzed the largest sets of each category, so there are probably a lot of other factors at play here.
It follows this analysis that, if you have investment money, transportation sets are usually a safe bet, with Ships being the top choice.
Before we conclude, let’s now examine my top currently available choices that fit into any of these four categories.
10233 Horizon Express
My Analysis: The Horizon Express is the largest LEGO train ever produced, and that fact alone should be enough to make it an investment winner. Of course, there are several more factors that make this nice train a very appealing option, like it’s unique colors and elements, advanced building techniques and nice interior as well as exterior detailing. The Horizon has just been released a short while back, so there is plenty of time for you to get it at a nice price, you will for sure want to add some to your investment Brickfolio
Value Prediction: The fact that it is the largest train LEGO has ever designed will make it one of the most sought after trains once it goes into retirement. In my opinion, the Horizon will easily outperform the LEGO train average CAGR we calculated above, expect a number closer to 20% over its first two years after retirement, putting it around $ 270 (Assuming it goes EOL by the end of next year)
10226 Sopwith Camel
My Analysis: No need for me to tell you how good this set will perform, you have already seen what its smaller and less fancy predecessor has been doing over the past few years: going up steadily in value. Even more, we are talking about a vastly superior model, with a lot of pieces in a nice and rare green tone, several functional features, and a just outstanding display value. Truly, a collector’s piece.
Value Prediction: Planes came third in our little experiment above, with an average CAGR above 15 %. Even more, the older Sopwith presents a CAGR of almost 10 % after being retired for more than a decade. If we project the same trend with this current version, by the time it has been retired for as long as 3451 its price should be somewhere around $ 285. It is my opinion, however, that this set will be doing a lot better than that, so plan accordingly.
10220 Volkswagen T1 Camper Van
My Analysis: Another VW licensed vehicle that probably will turn out to be a great investment choice, just like the VW Beetle before it. Set reviews for this set, both here on Brickpicker and in some other LEGO sites, have been extremely positive, mostly highlighting is “historical” significance and high accuracy compared to the original vehicle.
Value Prediction: If this set even remotely follows the path set up by the Beetle, then we are up for a big payday in the future. It is important to note though, that the Beetle retired at a point where LEGO investing was not as widespread as it is today, so expect the Van to perform great, but not as much as 10187. A 25 % CAGR by the time it has been retired for as long as the Beetle would put it around $ 360. We will all be happy campers with this set!
79008 Pirate Ship Ambush
My Analysis: My pick in the ship category has not been released as of this date, but I might as well let you know it is the Lord of the Rings 79008. This great looking vessel will come with 9 high quality minifigs, including the more than likely exclusive Ghost King, and some other interesting characters.
Value Prediction: Not really much information to really give you an accurate prediction, but I will go on a limb and guarantee this ship will perform at least as good as the POTC ones, especially QAR.
We have come a long way, travelling by so many different ways and through so many years of LEGO history. I have said more than I really had planned to do, but I really hope I have given you at least a superficial look at some of the positive aspects of LEGO transportation set investment. All of these different categories have their own strengths and weaknesses, but as far as choosing them as investment choices for your Brickfolio, the historical information seems to guarantee that any of them will take you where you want to go, and allow you to bring some money back with you at the same time!
Thanks for reading.
*Title by Ed Mack*
It is still very early to perform a proper and more accurate re-make impact evaluation about the UCS X-Wing, but now that we have our first month of actual eBay data I wanted to make a couple points and observations that I found interesting about both sets. Later this year, once we have several more months of data, I will be able to write a more in depth analysis.
For now, let's just take a look at the numbers presented by the "old" UCS 7191 X-Wing so far this year:


There are a couple of short comments I want to make about these graphs above:
There was only 1 New 7191 set sold in the month of May, so the increase in the market value of the set does not tell us much about the possible impact of the new 10240 X-Wing on sealed sets. Most of the interesting data comes up when taking a look at sales of used 7191. In the past month of May and according to BP data the older version of the X-Wing sold 17 copies with a mean price of around $ 283. This number pulled the overall market value of used 7191 up by more than 17% relative to the past month of April. From these two points above, we can gather that at this point there is not enough data to determine the first month's impact of 10240 over 7191 when it comes to new sets, but that there seems to be enough to make some inferences about used copies. It appears from the graphs above that at this point investors, collectors or casual LEGO fans have seen no reason to stop purchasing the old version of the X-Wing or to even to pay prices that are substantially higher than what a new 10240 currently goes for. In fact, relative to previous months, the prices for used copies increased by a substantial amount!
At first sight then, it seems that the remake has not negatively affected the interest for the old ship, and for the sake of investors let's expect things to stay the same.
The purpose of this blog entry is to shed some light on the possibility of using the standard deviation as a measure of risk on different themes, types of sets and so on when investing in LEGO. This article will assume that LEGO returns follow a normal distribution.
I am sure several of you already know about standard deviation, since it is often used as a measure of risk in more traditional investments like stocks, mutual funds, etc. For those of you that don't know much about it, we use standard deviation to determine the volatility of a particular investment or portfolio by evaluating how much is the data spread from the mean investment return. As a quick example, let's evaluate this simplified scenario: (The numbers below are not actual figures and are used for illustrative purposes only)

Also, it is good to have the normal distribution graph as well to make it the following analysis easier to understand:

So, what the numbers in the table above tell us can be summarized as follows: If the average return of the sets that constitute the Ninjago theme is 22%, a standard deviation of 10% indicates that, per the normal distribution, for a particular set among the theme the probability for its return to be between 12% and 32% is around 68%. Another read that could be made is that there is a 95% chance that a particular set returns between 2% and 42%.
Further examining the example we can take a look at the CITY figures. In this case, there is a 68% probability that a CITY set will return between 8% and 12%, a substantially smaller range than that of Ninjago sets. What this basically means is that you are more certain about what kind of return you will be getting when the standard deviation measure is lower than when it is higher.
Now that we got that out of the way, let's examine how we can use the measure to our advantage in LEGO investing. I will just give you an example using two different type of sets and what we can gather from the numbers they present, so that later you can probably do the same with themes or sets that interest you more. I will only be using returns of already retired sets, since that is the kind of information that is the most valuable. Also, I selected only four sets of each theme for simplicity purposes, but the more you include the more accurate the result.

What the figures above mean is that you can expect a CAGR between 13% and 25% about 68% of the time when it comes to LEGO Sculpture sets, while the range for Advanced Models is a little wider (23.6% - 36.14%). By analyzing these results you will be able to determine that even though both investments have pretty much an identical standard deviation measure (risk), the Advanced Models theme will generate, in general, better performances that the Sculpture sets, so in theory you would be better off investing in the former rather than the latter. Same risk but higher return.
One last thing before we continue, the 68% confidence interval is not the only one you can analyze when performing risk analysis, especially if you are someone with a low risk tolerance, since there is still a 32% chance that the returns will fall outside of the range explained above. A better measure for those that are more risk averse would be to consider the 95% confidence interval, that would give you a range of returns from 7% to 31% with only a 5% probality of it going outside the range (in the case of Sculptures, for example)
There are several variables at play that we need to consider when doing this type of analysis, so I want to say that this short article is just intended to give you an overview of what is possible to accomplish by using this measure. Standard deviation can be used also to determine the spread of other investment figures like change over retail and some of the others, as well as used both for complete theme vs. theme analysis or some more specific comparisons.
If you are interested in checking out some different sets or themes, I attached a small Excel spreadsheet that shows the way I calculated the numbers in the table above.
 
Excel.xlsx (10.16KB) : 18
Is the Friends theme worth investing in? If one were to search the forums for an answer to this question, you would find rather fervent opinions on both sides. Currently the Friends theme sports a CAGR of over 35%, making it one of the highest in the LEGO universe. So is that it, end of story, numbers don’t lie – ‘Friends’ is an investment winner? It is hard to say with such a short history to go on, but I’m skeptical.
There is no question that the Friends theme has been exceptionally popular at retail and is unlikely to go away any time soon. Does this make it a good investment though? Duplo sets sell very well at retail, does that mean people should start investing in Duplo? Eh, doubtful (I am about to get flamed by the sole Duplo investor out there). ‘Friends’ are hot at retail, but will they be hot in the secondary market? Are AFOLs going to pay a premium for Heartlake Vet or Olivia’s House or a Summer Riding Camp when they are no longer available in stores? One has to imagine that some comparable iteration of these sets will always be available. Surely there will always be a Vet, (Insert name)’s house, and as far as horses – there will always be horses. There will never be a time when a LEGO customer cannot go into a store and find a Friends “Horse” set. Just like there will never be a time when someone cannot go into a store and buy an X-Wing. There aren’t many LEGO certainties, but this is a rare exception.
Almost any retired Friends set is going to have an equivalent set available at retail. Now, the same might be said for the CITY theme as well and certainly there are a number of hits among that theme. What is going to compel someone to pay $200 for a retired Summer Riding Camp when there is a $100 - 2015 Equestrian School on the shelf that is just as good as the Summer Rising Camp, if not better? Do little girls really care that one set is more “rare” than another and therefore more desirable? Are there middle aged women that collect Friends sets and are willing to pay extra for rare retired sets (a la Barbie)? Or, perhaps more disturbingly are there grown men (think Bronies) collecting EOL Friends sets? That sort of condition could certainly lead to highly elevated prices.
Ok, so I have thrown out an abundance of opinion, so let’s look at some actual data. The CAGR is over 35% as previously mentioned – that’s impressive. However, how consistent is that return across the theme? There are currently 54 Friends sets in existence, 10 of which are retired. If we look at just the retired sets we have the following:
 

This chart illustrates why I think the high CAGR may be misleading. There are a lot of low priced sets on this list. Low priced sets seem to be more susceptible to inflated BP percentages. While the increases look impressive on a percentage basis, the net return is less so. The net return above is based on the “lowest acquisition price” which I thought might be a more reliable way to look at these low priced sets. With that said, there are at least two clearly worthwhile hits that made for viable investments, 3187 and 3942. This list also shows that we don’t have much data to go on yet in determining how well ‘Friends’ will do on the secondary market. These are all newly retired sets after all. The other aspect I wonder about it is how many people had the foresight to invest in 3187 and 3942? It is likely that the supply of these retired sets is low. Now that investors have been turned on to this theme, will future retired sets be in such short supply?
Now going back to the high CAGR and the abundance of low priced sets, let’s look at the breakdown of the current list of 54 sets currently in this theme. Of these, 23 either have not been released or have a MSRP of $0.00. In either case, they are not included in the aggregate CAGR calculation. That leaves 31 sets, (including the 10 retired sets listed above). The MSRP breakdown is detailed in the histogram below.
 

The chart shows that 18 of these 31 sets have an MSRP ranging from 3.97 to 14.99. Therefore, the CAGR for the theme is going to be heavily influenced by these low priced sets. I would be cautious about basing theme wide optimism on data from so many low priced sets.
Now, I don’t hate the Friends theme. I think the Summer Riding Camp is a great set and the upcoming Dolphin Cruiser has great appeal for its uniqueness among the line. I just think we need to look behind the numbers to see what is driving that very exciting CAGR and set investment expectations accordingly. Odd as it may sound I actually have a lot of the $9.99 retired sets above. Now, that is only because I happened upon a huge supply of them at half price and I decided to take on the tedium of reselling them. I don’t expect much from them and will be unloading all of them this year. My purpose in exploring this topic was to see if my gut bearish sentiment was justified and the opinions expressed at the outset reflect those initial gut feelings. I will say that having looked into the Friends line further I do see some potential in very select sets, but count me still in the bear camp. Ok, I'm ready for my pink and purple hate mail now.
Investor: Veegs
Investments (LEGO) to date: About $8000
Sales to date: About $600
Wife (One day overdue now...and still very pregnant) anger level: 9.5/10
Most Recent Acquisition(s): Captain America at TRU.ca (only to get 30116 polybag)
I was just perusing the other community blogs and really enjoyed reading articles that are a mix of personal as well as Lego. I also have the ability to type, so I figured I could emulate my fellow Legoists and provide a little (more) content to a site that I use so frequently. I do have three (count'em!) *pat self on back* published articles done prior to the changeover to this fancier version of the site, which make excellent light reading. They would have been better, but I blame my editors - they took out all the Lego conspiracy ramblings I threw in and just left investment-based information. Now, no more. I love that this blog feature lets me bare my investing soul with little to no oversight. To celebrate, I'll start with a run-of-the-mill, how I got into this hobby type post. I know there have been a few threads here and there with the same general idea, but I am on a power trip and feel like describing my unexpected journey in more words than most people would want in a general forum reply.
It started slowly, the way things tend to start in the beginning, with a single cell that begins to divide. Wait - that is how my wife got pregnant...I think my Lego investing started at Pearl Jam Twenty. For those who don't know me, I am a little crazy 'bout Pearl Jam. I grew up on 'grunge' and now, in my mid-30's, still love the band but have more discretionary income to travel to see shows and stock up on merch. Two years ago, celebrating the band's 20th anniversary, I traveled from Ontario to Alpine Valley via Cleveland to see a weekend of PJ. Once there, I saw tons of people buying concert posters and cradling them like newborn infants. I wondered why, and after spending hours chatting with other music nuts, realized that collectors grab silk-screened prints to commemorate shows they have been to (or just prints that look awesome). I realized I a) had a house with a room just for me, and (gah! I can't get a the letter b and a bracket to NOT make that little emoticon) I suddenly needed posters and tokens from every show I've been to. Things quickly spiralled out of control and after getting back from the show I spent hours researching gig prints and their value, the artists, etc. I learned just enough to start spending money. I actively purchased below expressobeans (a must have site for print collectors) averages on any prints I could get my hands on. My wife grew weary of the castle of cardboard I built with my poster tubes. Then something magical happened - I started to list these posters on ebay and during November and December people bought a heck of a lot of them - presumably in an offering to Santa/God. My paypal account began to grow flush with cash and I got better at picking with prints were solid investment choices and which would languish in my portfolio, waiting years to be sold for minimal gain (The Lego Atlantis version of prints). Then Pearl Jam decided to do a short Euro 2012 tour and 3 US dates. Interest in the band wanes when they aren't touring or making new music, and I had read everything I could about their prints. I was hungry for more information and wondering what other collectibles I could invest in (keeping one for myself, obviously).
Then it hit me like something heavy hitting you in the head, but metaphorically - other collectibles! I stayed with the PJ community and read a lot of threads about how expensive vinyl records were. Apparently musicians make very small amounts of vinyl available when a record is released, and, unlike CDs, *rarely* reprint (it seems okay to reprint if it has been out of print long enough - like remaking Jabba's Sail Barge or X-Wing Red Five) which means that hot items (listed as limited or on colored vinyl) command big secondary market prices. I started reading/researching and watching ebay sold listings, salivating. My work life began to suffer, my home life as well. My wife wanted to know why I was now adding 12 inch cardboard mailers to my giant castle of round cardboard poster tubes. Some nights, I slept in that castle, not by choice. Record Store Day and Black Friday Record Store Day brought some opportunities to make a little cash with a little hard work, and I spent a lot of time pre-ordering the best vinyl (the best vinyl being perhaps the first 1000 pre-orders worldwide, which will get a different edition of the album instead of plain black vinyl) and got better and better at making investment picks. Unfortunately, much like LEGO, the popularity of Record Store Day and vinyl in general meant picking very carefully. Picking very carefully also meant purchasing sparingly, only for records I was close to 100% certain I could later flip for at least a 30% profit after fees. I left a lot of smaller fish out there, and soon realized I only really wanted to invest in vinyl I also loved. I couldn't bear following bands/record labels of music I didn't really care for (invest in something you love, can read about for hours and never grow weary of discussing ad naseum on various forums or you'll eventually ditch your new 'hobby') so I now only have a small, manageable amount of bands/record labels I need to check. This gave me more time to get into another market - LEGO! (yes, I will finally talk about Lego. If you have read this far the tip in parentheses above about reading literally anything even remotely related to your passion and never growing weary likely describes you - we can be friends)
I always checked out the Lego aisles when I went shopping with my wife, and have always loved Lego, but I spent most of my twenties travelling the world and living in various locales abroad. No base to set up a serious Lego habit, but I had always loved Lego and occassionally checked out the Shop & Home website just to drool over cool Lego. I joined the mailing list of TLG and even while living abroad in Dubai got their emails and thought about how cool it would be to build that Taj Mahal. Anyway, one day at 'work' I took a gander at some of the sets I had loved years before and was a little surprised at their secondary prices on ebay. Within minutes I was on brickipedia and minutes after that, brickpicker. An investing legend was born. I had a fair amount of money from selling vinyl and prints, a total much bigger than my wife assumed, and basically started making it rain hundreds at toy retailers in the fall of 2012. Now I'm sitting on over 10K of mixed collectibles and I've got enough good sets that I'm gearing up to sell (I'm aiming to be a powerseller by Septmeber) and start to split the profits - half to a retirement fund and the other half to plow back into Lego.
I am going to see Pearl Jam next month in London, Ontario and with a fall tour there will be plenty of merch/print opportunities this Oct. and Nov. I've got dollar signs in my eyes and a 'music & Lego' room downstairs that still has some space. Time to placate the wife and make some more investments.
Was your journey as long and convoluted as mine? Do you have a pregnant wife who hates your investment hobbies (until you sell for a profit, of course, then it is all smiles and weekend getaways funded by your 'hobby') are you a pregnant woman/wife yourself? Do you like Lego? If you've read all this gibberish, and fit some/all of the above criteria, let's be Lego friends. I promise to read and post on your blogs even it is tangentially related to Lego investing.
Veegs
 
On this second entry of the BrickIndex Spotlight I will be focusing on one of the last real sleeper sets of the past year or so: The Zombies from the Monster Fighters theme.
The Zombies set was a Target exclusive, meaning that people could only purchase it through them or an actual LEGO store, thus causing the set to have a more limited availability than the average LEGO set. Even more, The Zombies only lasted for a few months and was retired very soon and without notice, a couple of facts that ended up boosting its appeal to both investors and collectors.
A lot has happened over the months this has been retired, but ever since this particular set has been in the top 3 places in the list of top performing sets of the last 6 months (BrickIndex). It actually spent several months on the first spot, but as time goes on and its growth slows down it has dropped to "only" third place.
We have to remember; this set was priced with a MSRP or $39.99 and at this point is selling for almost three times that value ($ 117.47). The rapid growth experienced by this set in a very short time caused its CAGR to be extremely positive at around 194%!.
Let's now take a look at the growth of the set in the graph below.

As you see above, the growth of the set really started accelerating once December came along, and has since grown every single month up to April of this year. In the table above, you will also see that there is a regression line that serves to show the linear trend the set has been following over the past 6 months.
Over the past month of April (last month we currently have data from) the set appears to have started slowing down on its growth, going up in value by "only" 2.5%. Once we get the data from the month of May we will be able to tell if the set is definitely maturing and will then only show minor variations in its value in the short term, but I think that even without that data the graph and some logic would suggest that to be the case.
What made this set so successful is such a short period of time? well, a big part of it is its limited availability and early retirement. Another point that probably played a role is the current popularity of anything even remotely related to Zombies, that probably made this set even more appealing even for the casual LEGO buyer.
To conclude, I just want to add that even though this set has been in the BrickIndex for the past several months and even continues showing some recent growth, most investors that currently do not own one would be better served by purchasing some of the other sets currently available. Opposite to the case of the Winter Village Bakery, I believe that the chance to make significant profits in the short to medium term are almost null with this set given its growth pattern and its current market value.
Thanks for reading
Let me start out by saying that the title is definitely stereotypical gender bias, but don't let that exclude anyone. If you've got a man/parent/other supporting you, by all means change the title in your head to whatever is applicable.
This is a topic I don't think gets covered enough. The people in the background. The behind the scenes workers who don't get the spotlight, or even the credit sometimes, but are nonetheless pillars of all the business we do here.
My woman is amazing. She is the reason I am able to do so much in the field of LEGO, both as a hobby and an on-the-side business.
She let me repurpose a small room in our townhouse to a workroom. My command center and refuge for all things of the brick. I build here, shoot my photos, store my loose pieces, weigh, measure, pack, ship, drill, cut, file, etc. Without my space I'd drive her nuts invading the rest of the house.
Secondly, my woman is stylish. Very hip. She has a great sense of style, fashion, is strikingly beautiful, and is generally mega rad. I'd like to say she rubs off on me, although she'd describe it as "stealing her cool". I suppose it's a little of both. She is the first person I go to with a new MOC design. She signs off on most things I do, because I value her imput and trust her judgment when mine is biased or comprimised.
The biggest support she gives, though, is probably taking care of our daughter when I'm 'on the prowl'. My little one can't quite understand that not every Friends set I bring home is strictly for her to tear open and scatter all over her room.
My woman wants to be more involved, and as my ebay venture grows she'd like to add personal touches to my auctions, like sewn bags or whatnot, which I am all for.
I'll turn this over to you now by asking, "How does your woman, man, significant other, or whatever, support you?"
Ask yourself if you do enough to involve them, or ask yourself what you do that is only possible because they've got your back. They're your employee of the month, your backbone, your cheerleader, your inspiration, and sometimes even your boss.
Let's make sure they get proper credit. I'd be nothing like the man I am without her, and that's another debt in a long line of debts I'll never repay.
But, that won't stop me from trying.
"You take the blue pill, the story ends, you wake up in your bed and believe whatever you want to believe. You take the red pill, you stay in Wonderland, and I show you how deep the rabbit hole goes."
These are the words of Morpheus, a prophet in the sci-fi thriller The Matrix, and I think they accurately describe the choice many Brickpicker members face early in their investing career. Should I try to learn and understand the Lego secondary market, or take it for granted that it will exist as it does now? This is not an easy decision since information about the aggregate market isn’t readily available. So taking the blue pill is simple: buy some sets people think are great and hope for the best. Taking the red pill is scarier: the more you learn about the market, the more daunting and wrought with peril it may seem. To be a savvy, profitable investor you must learn as much as you can about the market you seek to exploit. That way, you will be able to properly decipher threats to the market, and adjust your investing strategy as circumstances dictate.
The most recent potential threat to the secondary market is Pleygo, an online Lego set rental company. Pleygo operates very similar to Netflix, the subscription movie delivery service that revolutionized the movie rental industry and killed brick and mortar movie rental companies. Pleygo appears to be quite user friendly. After signing up for a subscription, a new user adds sets to his Wish List, and Pleygo sends the first available set on the Wish List to him along with return postage. Once the user sends returns Lego set, Pleygo sends the next available set on the Wish List.
Pleygo’s value proposition to parents is compelling: for a reasonable monthly fee, kids and adults can satisfy their "Lego fix" by building a variety of sets without the drawback of providing the space required for sets and boxes. Pleygo offers three levels of pricing, or “plans” that consumers may purchase: Fan, Super Fan and Mega Fan. The Fan package allows members to pick any small or medium sized Lego set, Super Fan’s may pick any small to large sized Lego set, and the Mega Fan plan will allow members to select any set in the Pleygo portfolio, including the enticing “huge” sized Lego sets that include Millennium Falcon (7965, not 10179 - sorry guys), Super Star Destroyer, Taj Mahal, etc. While there are only eleven “huge” sets to choose from, I’m sure Pleygo will add more as the business expands. Pleygo also emphasizes their commitment to safety and cleanliness by sanitizing every piece returned by a member.
Pleygo sounds like a great concept, and indeed the business has already attracted venture capital funding, so a lot of smart people have bet on the future success of this business. If Pleygo succeeds, what effect will it have on the secondary investment market so important to Brickpicker members? To answer this, we must first determine whether Pleygo is a competitor to the secondary market. If it is, and the secondary market shrinks significantly because of Pleygo, Lego investors could be left holding millions in unsold inventory staring down the barrel of a significantly diminished market.
To start, we must determine who buys Lego sets on the secondary market, and whether their Lego needs will be better satisfied with Pleygo. The clearest way to do this is to segment secondary market buyers. I believe secondary market buyers fall into one of two market segments: AFOLs or “Adult Fans of Lego”, and parents of children who insist on having certain sets.
 

 
These market segments can be further segmented to properly illuminate the market. For the AFOL segment, secondary buyers include Lego collectors, MOCers, and casual adult Lego fans that typically purchase Lego sets for their kids rather than themselves.
 

 
Among AFOLs, Pleygo may appeal to some in the Casuals and MOCers market segment, but MOCers will not forgo secondary market purchases for Pleygo. Those few Casuals that sign up for Pleygo themselves may stay with Plego instead of secondary market sets, but Casuals are the smallest segment of AFOL secondary buyers anyway and the few lost to Pleygo will likely not be significant. Collectors may want to use Pleygo to see whether they like a certain set before buying it, but I don’t see collectors buying fewer sets for their collections/displays because of this service. If anything, collectors may be encouraged to buy more sets since they can try out new ones frequently and cheaply with Pleygo.
That leaves parents buying sets for their kids as the remaining possible market segment that could turn to Pleygo at the expense of the secondary market. Here is my simple segmentation of this market:
 

 
The three market segments in the Parent Market are the Whiny Kid Buyer, the Lazy/Unsavvy Buyer and the Kid Collector Buyer. Everyone knows a parent like the Whiny Kid Buyer: they will drop untold amounts of money to keep their kids happy. These parents act at the whim of their child, and while Pleygo may be offered by Mom or Dad as an alternative to expensive sets demanded by “Little Whiny Johnny”, Johnny will not relent if he wants a retired Lego set. I see this remaining a strong segment for the secondary market. I believe the Kid Collector segment will maintain its connection to the secondary market for the same reasons the AFOL collector will. That leaves the Lazy/Unsavvy Buyer as the last remaining market segment to be stolen from secondary sellers. With proper marketing, Pleygo could make some inroads into this market segment, so the secondary market may feel a threat to this market segment from Pleygo.
From Pleygo’s perspective, their key market demographic is parents who want to reduce their cost outlay on Lego sets and save storage space in their home. Their target demo is evident in their value proposition: saving money and saving space satisfy parental needs, not children’s. Generally, young Lego enthusiasts would rather own a Lego set, but will accept Pleygo as an alternative to no Legos, so they aren’t really Pleygo’s target market. Typically, Pleygo’s target buyer wouldn’t be using the secondary market to buy sets for their children anyway, unless they fall into the small Lazy/Unsavvy Buyer segment.
As a result, I don’t see Pleygo threatening the secondary market much. While it’s possible there could be some defection from the Lazy/Unsavvy Buyer segment to Pleygo, it will likely be limited as the Lazy/Unsavvy Buyer uses eBay because it’s easy and familiar, and Pleygo would be something different. I believe Pleygo could actually be good for the secondary market since it could stimulate sales to collectors that may not be familiar with or closed off to themes they can access cheaply through Pleygo. Interestingly, Pleygo also has links to Amazon third party resellers for sets that have been retired, so Brickpicker members that are third party Amazon sellers could actually have a new market opened to them by Pleygo.
I can’t stress enough to Lego investors how important it is to learn about the market. Savvy investors know the Lego secondary market inside and out, and can foresee trends instead of being caught by them. I would hope every Brickpicker member would "take the red pill", and try to thoroughly understand the market you hope to capture. In the words of Morpheus, “No one can be told what the Matrix is. You have to see it for yourself.”
As many of you can relate, my five year old son is crazy about Lego. He likes building sets, making his own little creations, and adding new sets to his collection. He loves minifigs. He loves Lego Star Wars, Legends of Chima, Ninjago, and now Castle Lego. He also likes to talk "investment sets" with me, and one day as I was perusing Amazon, he asked me why my Wish List was full of Lego sets.
When I explained to him how the Wish List worked and what "priority" meant, he said, "Dad, I want to rank my own Lego sets".
 
I started listing the ones he owned, but after a few he interrupted me, saying,
"No, Dad, I mean the ones I don't have. I want to make MY OWN wish list."
Being slightly intrigued about what my big shot Lego connoisseur was cooking up in his brain, I logged onto Lego S@H with him, and we proceeded to go through all of his favorite themes and rank his favorite Lego sets. At first, it was a little abstract for him and we ran into logic problems, i.e. set #1, ranked above set #2, was ranked below set #3 even though #2 was ranked higher than #3. After working out the kinks, he got the hang of it and the original list evenentually grew to include 60 sets!
Before diving into the list, there are a couple of qualifications:
1. We didn't include any sets either he or I already owned. These include four of the non-exclusive Chima sets (Cragger's Command Ship, Laval's Royal Fighter, Wakz' Pack Tracker and Razcal's Glider), 9493 X-Wing, Lone Ranger Commanche Camp, and a boatload of Ninjago sets. The only sets I owned at the time were the Tower Bridge, VW Camper and An Unexpected Gathering. These were all excluded from the list.
2. I think he got a little hung up on set size, although that's probably indicative of how a five year old's mind works - bigger is almost always better.
3. He told me he wants this list to double as his Christmas list. I quickly made him aware that he would NOT get everything on his list.
Without further ado, here are his rankings from his favorite on down:
1. 10236 Ewok’s Village
2. 10237 Tower of Orthanc
3. 70404 King’s Castle
4. 7965 Millennium Falcon
5. 10188 Death Star
6. 10221 Super Star Destroyer
7. 9450 Epic Dragon Battle
8. 10227 B-Wing Starfighter
9. 10225 R2 D2
10. 10232 Palace Cinema
11. 10223 Kingdoms Joust
12. 10937 Batman Arkham Asylum Breakout
13. 79008 Pirate Ship Ambush
14. 10233 Horizon Express
15. 6860 The Batcave
16. 9474 Battle of Helm’s Deep
17. 7879 Hoth Echo Base
18. 10228 Haunted House
19. 10226 Sopwith Camel
20. 60014 Coast Guard Patrol
21. 60004 Fire Station
22. 7939 Cargo Train
23. 7398 Passenger Train
24. 9516 Jabba’s Palace
25. 7498 Police Station
26. 4204 The Mine
27. 9468 Vampyre Castle
28. 60008 Museum Break In
29. 79111 Constitution Train Chase
30. 79010 Goblin King Battle
31. 70505 Temple of Light
32. 10240 Red Five X-Wing Starfighter
33. 4440 Forest Police Station
34. 9500 Sith Fury Class Interceptor
35. 9515 The Malevolence
36. 70705 Bug Obliterator
37. 9467 Ghost Train
38. 79004 Barrel Escape
39. 6857 Dynamic Duo Funhouse Escape
40. 9449 Ultra Sonic Raider
41. 9526 Palpatine’s Arrest
42. 79003 Superman: Battle of Smallville
43. 70403 Dragon Mountain
44. 79103 Turtle Lair Attack
45. 70012 Razar’s Chi Raider
46. 70708 Hive Crawler
47. 79104 The Shell Raiser Streetchase
48. 50006 Legends of Chima game
49. 70402 Gatehouse Raid
50. 79110 Silver Mine Shoot Out
51. 79109 Colby City Showdown
52. 79019 Stagecoach Escape
53. 60010 Fire Helicopter
54. 70401 Gold Getaway
55. 21102 Minecraft
56. 70400 Forest Ambush
57. 70002 Lenox’s Lion Attack
58. 70003 Eris’ Eagle Interceptor
59. 70011 Eagle Castle
60. 79106 Cavalry Builder Set
Congrats for making it this far! I posted this to show one five year old's preference in Lego sets. While I feel he has fairly representative tastes, take it for what it's worth. At the very least, the list can show where Lego may be succeeding with his age group, and where they may be falling short. Here are some of my observations on his list:
1. Ewok Village at 1! After all these years, kids still love Star Wars OT. Also, six of the top ten are SW OT sets.
2. Am I raising the ultimate consumer? Look at the MSRPs of the first 15-20 sets!
3. I can't believe the new X-Wing wasn't higher than 32. As mentioned before, he does own 9493 X-Wing Starfighter, but he's even seen 10240 at the Lego Store, so he knows how big (and cool) that set is.
4. Six City sets settle in just outside the top twenty, and although they are big sets, they're behind most of the other big sets. They seem to occupy the "best of the rest" spot that is after his favorite big sets, but before his favorite smaller sets.
5. He appears to be a burgeoning Castle fan. The new King's Castle comes in at #3, an incredibly high ranking. For those badmouthing the new Castle releases, pre-teen boys is TLG's target audience for this line, and early returns (from my son) are great.
6. My son has never seen either the LOTR or The Hobbit movies, yet Tower of Orthanc clocks in at #2, Pirate Ship Ambush at #13 and Helm's Deep at #16. Apparently, size matters as they say...
Welcome to the 2nd Edition of the Re-Make Impact Evaluation section. For those of you who read the 1st Edition, the purpose of this article is already clear, but if you are new to my blogs, I recommend you to at least read the intro section of the first Impact Evaluation dedicated to the Sopwith Camel.
As you all probably know, 9516 Jabba's Palace set was the focus of investor and collector's attention a couple of months ago when news about its possible early retirement were spread through the news networks. In those crazy days, the set saw a huge spike in price as a result of panic buying and short term flippers that has since faded out. Now that everything is back to normal, I think it is important to remember that this version of Jabba's Palace is actually the second one released by LEGO, since back in 2003 the 4480 Jabba's Palace was introduced.
The older version of the Palace is obviously inferior to this current one, with a lot less detailing and lower quality minifigs. Back then, LEGO was still in the early years of what I think as of a huge jump in set design and quality, so the inferiority of the model is actually not that surprising. The older version included only around 200 pieces, but despite its small size and not great detailing the set actually performed great in the secondary market, with its highest point in the last 12 months reaching $ 170.
Let's now take a look at how the set has behaved since the newer version was released around mid-year 2012:

So, you can see on the graph that the trend for the old 4480 set has been negative for most of the time. We also have to consider that 9516 was made available in July, but that its official announcement was made some time before that. From the data, we see that over the past year alone 4480 has lost around 28% of its value, and currently sells for around $131. You may ask, how can we be so sure that the newer version is the cause of the sudden drop in value?, well there is no way to be completely sure without a very in depth analysis, but I can at least tell you that between the beginning of May 2011 through April 2012 the set lost only around 6 % of its value, while in the past year or so (May 2012 through April 2013) the set has lost that 28% we mentioned earlier. There is clearly some relation between the announcement and release of the new version and the sharp decrease in value of the old one.
Of all of the sets I have been evaluating for this section, this one of the sets that has experienced such a large drop in value following the new release. It will be interesting to see if it continues to drop further in the following months, but it is very clear that most investors would be better served by selling some of their stock just in case the 4480 continues this downward trend.
Before I was an investor, or even a collector, I was... A TRADER. I think that I started out back in 2006 with a friend who was years older than me and a large collection of Lego. I got a few figs off of him for some pieces (he was being generous) and was hooked from there. Through the years, I have expanded my minfigure collection through trading and buying, and now about 2/3 of my minifigures are pure profits from trading. (I don't want to argue out this whole profit thing now, so you can find one of my other trading posts if you want my explanation.
Early on, I discovered that a tackle box is the wau to go. My first was a little thing with no separators, and I used this for a year or two. I moved up in the world of tackle boxes until I got the one you see here about a week ago. Minifigures are very valuable, and I believe that they must be protected carefully. I lay many of the more valuable ones on plushy cloth, and put others and small Zip-Lock bags. This greatly reduces the chances of scratching, and keeps them in great condition. This is the best way I have found to store minifigures so far, but I will keep searching for better ways!
 

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