Is Pokémon a Good Investment? An Honest Look at the Data

A friend of mine who works as a supply chain manager recently passed along a claim that sounded like nonsense: that sealed Pokémon product has, over the long run, outperformed the S&P 500.

My instinct was to dismiss it immediately.

Hedge funds employ some of the sharpest quantitative minds on the planet, armed with models most of us couldn't follow on a whiteboard. And the well-documented reality is that the majority of them still fail to beat the broad market over time. So the idea that a children's card game could quietly outperform the people who do this professionally seemed absurd.

It turned out to be true. It also turned out to be more complicated, and more interesting, than the version you usually hear.

The Math (and the asterisks)

When I dug in, the first thing that became clear is that the claim is only meaningful if you're precise about what you're measuring. The product that has the data, the standardization, and the track record is the sealed booster box — brand new, unopened. Singles, ETBs, tins, and the rest are a different conversation. Everything below is about sealed boxes.

Here's the honest version of the numbers, including the parts that don't flatter the thesis:

Independent analyses consistently show sealed boxes beating the S&P 500 — but the size of the edge depends heavily on the window you measure. A frequently cited study covering 2015–2020 put sealed boxes at roughly 21% annualized versus about 13% for the S&P. More recent analyses of modern sets show much larger gaps — averages in the 40%+ range — but those almost universally start the clock in early 2020, which means they bake in the entire pandemic collectibles mania. That's the single most important caveat in this entire post, so I'll say it plainly: the most impressive Pokémon return figures you'll see online are measured from the bottom of the biggest boom the hobby has ever had. Strip that out and the edge shrinks — it's still an edge, but a more boring one.

A second honest point: "every set goes up" is roughly true for vintage and much shakier for modern. By most accounts, essentially every sealed product released before ~2015 has appreciated over a long enough hold. But modern sets face a structural headwind vintage never did — The Pokémon Company now prints on a scale that did not exist in 1999 (roughly 12 billion cards in a recent fiscal year). Scarcity is the entire engine of this asset class, and modern overproduction is sand in that engine. The vintage thesis and the modern thesis are not the same thesis.

What survives all of those caveats is still notable: across credible methodologies, a diversified basket of sealed boxes has produced annualized returns comfortably above the S&P 500 over multi-year holds, without leverage, options, or any skill on the buyer's part. Not "every year." Not risk-free. But real.

The Case Against (because you should hear it first)

If I'm asking you to take this seriously, I owe you the strongest argument that it's a bad idea — not the weak one.

The weak objection is "collectibles are silly." Ignore that one. The serious objections are:

Recency bias. Much of the lifetime return is concentrated in a demand explosion (2020–2021) that may not repeat. A thesis that only works if you started measuring in 2020 is not a thesis; it's a backtest.

No cash flow. A booster box pays no dividend, no rent, no interest. Every cent of return depends on someone later paying more. That's a fundamentally weaker engine than productive assets.

Friction and illiquidity. You cannot sell a box at 9:31 AM. Real returns are net of marketplace fees, shipping, the time cost of building seller reputation, storage, and the genuine risks of damage, theft, and being scammed on the buy side. The headline CAGR is the gross number; your number is lower.

Concentration. Aggregate returns are pulled upward by a handful of breakout sets. The median box does worse than the average box, and "blindly buy everything" gets you closer to the median minus frictions than to the headline average.

I find the thesis compelling anyway — but only the conservative, vintage-weighted, long-horizon version of it, and only as a small slice of a portfolio. Anyone selling you the 40% number with a straight face and no asterisks is selling you the boom, not the asset.

Why I Still Find It Compelling

The reason I keep capital in this isn't the return chart. It's the demand structure underneath it.

Pokémon is, by most estimates, among the highest-grossing media franchises in history — and unlike most franchises, it is actively manufacturing its next generation of buyers. The kids of 1996–1999 are now in their 30s and 40s, frequently in high-earning fields, with disposable income and intact nostalgia. They are simultaneously the demand and, increasingly, the people introducing their own children to the franchise. Meanwhile, no one can print another 1999 first-edition box. Fixed (and shrinking) vintage supply meeting a demand base that renews itself generationally is the actual investment case. The price history is just the symptom.

What This Substack Is About

I don't think Pokémon is a path to financial freedom, and I want to be precise about what I'm claiming so this is the last time I have to hedge: I am documenting what I personally do with my own money in a niche, volatile, illiquid alternative asset. This is not financial advice, I am not recommending you do it, and you should assume every number in this space — including mine — is gross of the frictions that will eat into it. Do your own diligence. Use your own judgment.

With that said: I've deployed meaningful capital into sealed Pokémon over several years, and tracking it publicly has drawn far more interest than I expected. The point of this newsletter isn't to convince you the baseline works — the data already shows a no-skill basket beats the index over long holds. The interesting question is how much better a disciplined, vintage-aware approach does once you account for everything above. That's what I document here, honestly, including the months it doesn't work.

Free subscribers get:

• My complete Pokémon portfolio and monthly performance updates — gross and net of fees
• Long-form breakdowns of the fundamentals: what actually drives sealed value, and how to start
• Portfolio change notes whenever I buy or sell, with the reasoning
• My monthly shortlist of sets I think are best-positioned — and why
• Access to the subscriber community

If you want the honest version of this asset class — upside and the parts that don't fit on a hype chart — subscribe and follow along.