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TIE #029: The Best LEGO Investing Strategy on Earth (yes, it's that good)
All LEGO sets are great investments, but what if we only bought the best?
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Inside the most recent hit list update, I explained how I had redesigned my set picking strategy for LEGO investing.
In turn, the LEGO sets I am targeting to add to my personal portfolio this year changed dramatically.
As I mentioned there, I will not be revealing the specific criteria that the system is based on.
That reveal is coming to owners of my LEGO Investing Mastery guide, in a free update coming next week.
That said, I would like to present to you how the system would have performed historically had someone been using it since the start of 2021.
I don’t need to prove anything to anyone, but I find the vast difference interesting and would like to share it with you.
Check this out:
For sets retiring in 2021, the average return on investment is currently: 58.6%
Had you used my new system, your return would be: 98.1%
For sets retiring in 2022, the average return on investment is currently: 20.2%
Had you used my new system, your return would be: 43.2%
As you can see, the average return is incredibly higher using the system I created to choose my LEGO hit list each year.
That’s the thing though. These are just average returns across all retiring sets.
What if we weighted our capital towards the themes that perform better? This is the second part of the system I will be sharing with you.
If we put 80% of our investment capital into sets from the “best” themes that also fit the system and 20% to the remaining themes, this is what we’d have had instead:
2021 return: 175.1%
2022 return: 47.0%
Using this system at the end of 2021 would have turned $100,000 into $275,000 in less than 18 months!
Most Ponzi schemes can’t replicate that, let alone traditional investing.
Those “best” themes I mentioned?
These four have constantly outperformed the average, for years on end. For now, I don’t see that changing.
To reiterate in a concise way, this new strategy has two stages:
Stage 1: Identify winning sets with the new system and put them in a hit list
Stage 2: Allocate 80% of capital to winning sets from the four themes above, while spreading out 20% for winning sets from the remaining themes.
That balance will be impossible to get perfect, but anything close to it gives us an obvious advantage.
With all of that said, I want to be clear about one thing. Past performance is not always indicative of future results.
This new strategy is based on the last two years of data. That is an admittedly small sample size.
It will change over time as I continue to adjust and improve as the market transforms.
It won’t be perfect, but I’m convinced it will be better than the average by a large margin for 2023 and beyond.
For fun, I back-tested it with sets that retired in 2020 and it performed as expected.
Remember: If you are a paid newsletter subscriber, you have access to my LEGO portfolio and get an alert every time I add a new set to it.
You can take advantage of that and what I continue to share here about this amazing opportunity or you can continue to ignore it.
The choice is yours and I can’t make it for you.
When you are ready, there are two different ways I can help you:
If you are interested in starting an efficient one-person online business, I recommend starting with one of the following:
Textbook Flipping Mastery - My in-depth guide on how to start a high-margin Amazon e-commerce business.
LEGO Investing Mastery - My in-depth guide on how to start a long-term “buy, hold, and sell” LEGO investing business.
The Conference Room - My private mentorship community that includes the two guides above, for free. Pay once and stay a member for life.
If you are interested following along with my personal LEGO investment portfolio and getting exclusive alerts when I add a new set to that portfolio:
Become a paid subscriber here (7-day free trial available)
These posts are not financial or investment advice.
They are made for entertainment purposes only by a bum who gave up his job as a prestigious Aerospace Engineer to talk about parking money in things like LEGOs.