Is a Vintage Cigar Box Label a good investment? That is a hard question to answer. Vintage cigar box labels are definitely a unique investment. They also possess several qualities that true investors look for, such as: are they a true antique? are they rare? and do they have a worth? In addition, there are price guides, selling venues, and people willing to buy and sell at the right price.
However, these reasons alone are not quite enough for the avid investor. People that invest for a living will tell you that there are three things they look for in a good investment: growth over time, minimum risk, and ability to execute a sell.
So, let’s take a look at each of these.
Growth over time:
The best place to start is the Instone100. This is a blue chip index of 100 highly sought after vintage cigar box labels. Average selling prices for each cigar label in the index have been tracked and reported annually for the past ten years. Since they have started tracking, one can readily see, as a whole, that they have gone up steadily each year since 1994.
This charts show that if you invested $4,000 in 1994 the same 100 labels in 2010 are now worth $34,000. This is a whopping increase of 850%.!
Supposedly the Instone 100 index is an indicator of the entire cigar label market due to its wide range of labels. The labels range from the relatively inexpensive to a few in the thousands of dollars. In addition, the on-line Astral web site also tracks the recent Market trends in labels that go up in price. The chart below shows, over the past year that many more labels are going up in price then are going down in price.
Ability to Execute a Sell:
The key here is the ability to sell a cigar label for the price that either a price guide or an index says its worth. In this regards, cigar labels are much like coins, and stamps and not so much like rare original works of art.
There are only a few places to sell a cigar label: at an online auction sites like E-bay, at online trading sites like Astral, at auction houses like Heritage auctions, at dealer stores, at antique stores, and at collectible shows. Dealers in this sense are synonymous for ‘ stock broker’ (or dealer price), while auction houses are bidding venues. All have their advantages and disadvantages. Dealers will usually buy rare or well sought after labels. However, they only offer prices that are lower than a ‘book price’ or ‘retail price’ because they have to make a profit.
Auction houses like ’ Heritage Auction’ usually try to set minimum bid prices, with the hopes the cigar labels will sell over this starting price. Online auction houses like E-bay have no regulations, so they tend to be the low end of selling prices.
Is There Risk: Well, the saying goes “the only sure things in life are death and taxes” . There is risk in any investment. However, the experts that have tracked cigar box label prices over the past twenty years will tell you that as an investment they have shown slow steady growth, and they can provide data that backs this up. The data shows they are a better investment then if you put the money in the stock market.
How would you know what a good investment opportunity is? In the business world this is defined as a financial investment that makes a good profit. Millions of people invest in antique, coins, stamps and every other kind of collectible for this reason. Cigar box labels are on par with these kinds of investments.
After having made the case for investing in cigar box labels, I personally would never take one persons advice on an investment opportunity unless I got all the facts. Talk to the people that buy and sell cigar labels; use the internet for research, and start small until you are comfortable.
The best thing about Cigar Box Labels - it is a hobby for many people and an investment you can actually enjoy while they keep going up in price.