Miranda Day

Date of Award

2017

Document Type

Thesis

Degree Name

Bachelors

Department

Social Sciences

First Advisor

Khemraj, Tarron

Area of Concentration

Economics

Abstract

Magic: The Gathering is a collectable trading card game where players collect specific cards to create decks. Players then take their decks to large tournaments to compete for cash prizes reaching into the tens of thousands. As decks compete for popularity over time and new cards get printed, they create shocks in the markets of the cards in those decks. This research paper attempts to analyze these shocks in different markets with a focus on volatility. Beginning with some initial tests, the first case study is on a deck called “Modern Eldrazi” makes waves in the paper card market over a period of a few months. In the second case study, a decision by Wizards regarding the conversion of online cards purchased with Tix to paper cards impacts the online card market. Major conclusions of initial analysis include a projection of sporadic growth, factors for a “certainty threshold” necessary for a major shock, the “set value” perspective, and details about the long-term effect of trust established between Wizards of the Coast and the players it sells to. With initial testing complete, it is reasonable to now wonder, is the Magic market stable? This is broken down into three sub-sections. Is the market a random walk? How volatile is the market? What are some key differences between the general market and the standard market? Market analysis looks first at the general market from 2010 to present, then the Standard market from 2010 to present. Both show sporadic growth, though the Standard market is kept down by rotation. All in all, drops seem to occur largely as returns from spikes as opposed to being generated by shocks to the market.

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