thewoof2's picture
By: thewoof2, Christopher Gallon
Jan 08 2015 1:00pm
5
Login or register to post comments
3984 views


A while back I started a series on MTGO "stock" reports, I focused on financial tools used in the stock market and tried to apply them to specific cards in these articles found here: 1, 2, 3 and 4.  I always was fascinated at the MTGO economy and prices.  These articles were written back in 2012 so I wanted to kick off 2015 with another article that has a stock report on a specific card below.  But first let's talk about news and how news impacts markets.

Trading the News

Straight to a real life example to make my point.  On the first day of trading in 2015 (Jan 2nd) the US stock markets ended the day mixed.  An early morning rally saw the Dow Jones Index (see article 3 for info on indices) jump more than 100 points before evaporating after two disappointing economic reports showed manufacturing and construction activity slowed.  After the economic reports were released stocks tumbled and the Standard & Poor's 500 index fell 1 point to 2058 and the Nasdaq composite index dropped 9 points to 4727.  Why do I mention this?  Because news moves the market.  Investors use news stories to gain information not previously known and make stock trades on the news.  They also know stock markets are very fickle nowadays, said another way the stock market is easily swayed and goes with the crowd.  Mixed together news stories have powerful impacts on the stock markets, bad news gets the crowd of investors worried and then they all start to sell.  Similarly good news can drive investors to buy stocks and lead to huge gains.  Obviously we all know that Magic news also has the same potential and we see it all the time.  This article will delve into some recent MTGO news and its impact on a potential speculatory buy.

Macroeconomic News

There are two types of news in my view, Macro and Micro level news.  Let's start with macro news.  In my previous example I used macroeconomic news, it is news regarding the aggregate economy, in that case manufacturing and construction activity.  Macroeconomics examines economy-wide items such as changes in unemployment, natural disasters, home sales, rate of growth, gross domestic product, inflation and price levels.  Macroeconomic news tends to impact an entire market or at least a sector.  So let's take a look at Magic Online and its macroeconomic news.  First I will point you to a more recent article I wrote titled Your MTGO Stock Analyst - Troubled Times but Bright Future, this article's key point was regarding the financial health of WOTC parent company Hasbro and after listening to Hasbro's recent earnings report some positive news from their CEO regarding Magic being a flagship product and one they plan to invest in for the future.  The second piece of critical MTGO macro news is regarding version 4, despite any previous migration issues MTGO version 4 seems to be improving with higher usage and card prices stabilized for the most part.  Third we have the news that leagues are in beta testing with a 2015 release.  All these point to a healthy MTGO economy from my perspective.

Microeconomic News

Microeconomic news on the other hand is news about individual consumers or firms.  For instance if a well regarded and critical CEO of a company quits for another job, that news is likely to immediately impact the firm he is managing.  This news usually has a more pronounced impact on a stock because rather than a general aggregate impact, micro news is specific to the stock in question.  With Apple we see it all the time, the new iPhone is released and the number of units sold compared to expectations will have a significant impact on Apple's stock.  So let's switch to Magic, recently a new card has been spoiled and it looks to be a power house.

Monastery Mentor (Pre-Order: Ships Jan 23)

Read it again, yes the 1/1 white Monk token also has Prowess!  Also notice it is all noncreature spells not just instants and sorceries like Young Pyromancer.  Lastly it is not legendary, you can pack 4x of these bad boys and not worry about the legend rule.  Now this is juicy microeconomic news as it relates to white cards.  What it says to me is white is about to get a steroid shot in the arm in many formats but most impactful in Standard.  This card coupled with this...

Jeskai Ascendancy

Insanity for sure.

With this microeconomic news and the above macroeconomic news, I am ready to make my 2015 stock report.

January 2nd, 2015 Stock Report - Brimaz, King of Oreskos

      Brimaz, King of Oreskos     

Basic Stats

  • Set:  Born of the Gods
  • Reprinted:  No
  • Recommendation:  BUY 4.5 out of 5 stars
  • Non-Foil Price:  $18.68
  • Foil Price:  $56.05
  • Rarity:  Mythic Rare

Highlights

  • Brimaz, King of Oreskos is a powerful creature card used in standard, modern and legacy decks (see below).
  • Card sees casual play in fun decks using white or cat/soldier creature type decks.

Investment Rationale/Risk

  • Brimaz, King of Oreskos is a Mythic Rare in a set not notably drafted heavily.
  • With the upcoming release of Monastery Mentor, white creature based decks are poised for heavy use.
  • Macroeconomic factors of MTGO seem favorable as described above.
  • Brimaz, King of Oreskos is used in many formats.
  • Discussions are circulating on a potential banning of Treasure Cruise, if this happens blue will take a hit thereby increasing whites value.

Technical Analysis (Courtesy of MTGGoldfish)

With Trendlines

  • Excluding the normal release drop of Brimaz, King of Oreskos, the price has remained steady over time but it is currently down from its November/December highs of 26.
  • Even being down the trendline from mid year 2014 is upward slopping as seen in the second picture.
  • In an optimistic speculation we could see Brimaz, King of Oreskos reach 35.

Summary

Brimaz, King of Oreskos has a lot going for it, it is at recent low price, is a mythic rare used in many tourney formats and is well positioned for future white decks.  With the spoiled Monastery Mentor my thought is white is the wave of the future for many tourney decks.  Magic Online in general is improving and macro level news seems positive for 2015. If WOTC decides to ban Treasure Cruise white based decks will be even more popular. The only major risk I see for Brimaz, King of Oreskos is if Monastery Mentor replaces him in the white decks although my initial guess both will be used. Barring this risk I feel Brimaz, King of Oreskos is a great buy opportunity with potential to increase significantly to $30 to $35.

Decks

 

As always I am interested in your thoughts, are you all in on buying Brimaz, King of Oreskos or do you think I am off on my analysis?

Woof

5 Comments

News do not move the market. by Lagrange at Thu, 01/08/2015 - 13:28
Lagrange's picture

News do not move the market. "Unexpected" news move the prices. And there is zero scientific evidence supporting that technical analysis is a useful tool. You might as well pick stocks by troughing darts at a newspaper.

You should do an ex post evaluation of your earlier predictions.

Nice article by Dwarven_Pony at Fri, 01/09/2015 - 06:20
Dwarven_Pony's picture
5

I like your ideas and perspective. I would also add that Commander may cause its value rise also.

I agree that there is a chance that it will rise (perhaps to $20), but even if it doesn't rise it's still safe and steady. Think about it in comparison to Sigarda Host of Herons. Sigarda is still $10 even though she has rotated out of standard and she is only used as a 1-of in the Modern decks which play her. I think that Brimaz will have more use than Sigarda (although to be fair Sigarda is an absolutely amazing commander).

thanks and good point, I by thewoof2 at Fri, 01/09/2015 - 14:51
thewoof2's picture

thanks and good point, I don't see as much downside risk with Brimaz because of the commander/general use.

Brimaz steadily lost value by ML_Berlin at Wed, 02/04/2015 - 00:14
ML_Berlin's picture

Brimaz steadily lost value down to 16 tix, right now.
20% in just 3 weeks

I noticed that, I think by thewoof2 at Wed, 02/04/2015 - 20:24
thewoof2's picture

I noticed that, I think interest has gone over to Monastary and FRF right now so buying KTK has slowed. I am holding on Brimaz thinking it will rebound, but as I mention in the article a key is whether Brimaz is played in tourney decks along side of Monastary rather than getting pushed out...