Blog Archive

Wednesday, 18 May 2016

Trick or Treat bags 4 months on...

Back in mid January I followed up a previous investment advice post with some new ideas for investing into Trick or Treat bags. Back then, 4 months ago ToT bag prices were sitting at around 9.5 silver on the trading post, and even though the price had already increased by about 35% since Halloween, I gave some advice to invest because I expected them to rise a lot more in the coming months. Fast forward to present day and I was not wrong, and if you followed my advice you'll have realized that you're on to a big winner by now. Yes Trick or Treat bags have gone absolutely crazy, sitting at a huge 18.5 silver on the trading post right now. That means you have just about doubled your money after fees if you bought in at 9.5 silver, and even more if you invested when they were sitting at 7 silver a few months prior to that. The question now is what action to take and I will tell you my plans for my Trick or Treat bag stash moving forward.

First of all, as with any investment the following advice will be based on risk assessment. There are 3 typical methods and they vary from no risk to little risk and high risk. The first option is the no risk, but this option also usually yields the lowest potential rewards but it is safety first and it means you lock up your profit. This basically means selling your entire investment now. That might sound a bit hasty, and for the majority of investors this will not be a desirable option, but if you are in need of liquid cash this may be the method for you. Doing this will secure you a great profit with no further risk, but you will lose out on potentially higher profits. The low risk option is the one I would advise to go for for the large majority of investors. This means cutting your investment in half, selling one half and securing the profit and holding the other half to sell at a later date. Using this method you will secure the already very good profit on a good chunk of your investment, and you will feel less guilty about any future increases or decreases in the value of your investment. The third option is the high risk, high reward method which is basically go big or go home. This option is not for the weak at heart, and means holding onto your entire investment to sell in the future at a potentially higher price. This means you risk your current profit because the price of your investment can also decrease.

Thinking logically about the value of Trick or Treat bags, realistically the high risk strategy isn't as risky as you might think. This is because ToT bags are festival items, and the large majority of festivals are yearly events, this one being Halloween, meaning a potential decrease in value(usually from an increase in supply) is unlikely in comparison to, for example, a common crafting material. Fresh supply of ToT bags ARE obtainable, but only using the method explained here, which simply put is not profitable enough to be viable. With this in mind, we can use this information to make a better judgement on deciding which action to take with the investment. So which option am I going for? Go big or go home! It is not called high risk for no reason, and yes there is a possibility that you could lose your profit margins, but simply put the potential rewards far outweight the risk factor and besides, as an avid investor I enjoy a bit of risk! I could see Trick or Treat bags hitting 25-30+ silver within the next 3 months.

Keep in mind that you should take the option that suits you best, and that you should only take my advice fully knowing the risks involved. If you need liquid cash, sell your investment now. If you want to secure some profit but still see potential, you should bank half the profit and hold onto the rest. Keep a keen eye on this blog for an upcoming post about new investments you can get in to!