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A Philosophical Raga About Value

A short raga (i.e. train of thought post) about value, and how seeing that a Hockey Sweater is sold for a lot, does to you on a day where you haven’t had enough sleep. Value of a hockey sweater is also seen in the NFB short The Sweater .

What do you Value?

One of Bobby Orr’s old hockey sweaters was auctioned off fairly soon and the selling price was around $100,000 (Cdn). That number is an interesting number given what you can do with that money:

  • Buy a ridiculously tricked out sports car, no that’s not a good thing to spend $100K on either, but I include it as an example
  • Half of a house, depending on where you want to live.
  • 1.375 Children’s University education (an estimate on my part), if they go away to school (but stay inside your province)
  • An engagement ring for your spouse-to-be (again I am not espousing that idea either)

Many other interesting things can be bought for that price as well, but it all comes down to what you value and what collectors and other folks value.

Would a Don Awrey Canadians shirt from the 70’s get as much? Not likely, not even close, but even though it is the same thing (a hockey sweater worn by a player), it is the Cache of the player that wore the sweater that you end up paying for.

Is it Valuable because it is Expensive ?

This up pricing occurs with a lot of interesting goods, which may or may not be better than the standard goods. The reason is people are willing to pay it, so some people find value in the “Brand Name” associated with the prodcut. Is this the right way to buy things? Depends on what you are buying is the simplistic answer.

Should I buy designer hot house tomatoes for $1.50 a pound more than normal hot house tomatoes? I don’t but other folks do. I could buy an “MP3 Player” with similar abilities as the iPod, yet I end up buying the iPod instead, but I don’t think I am getting that much better a device, simply that it has the “Apple Cache”. I bought a used Toyota Corolla a few years back, for a good price (but more than I would have had to pay for a new Ford Focus, I think), back then Toyota was a good name brand, but is my car worth less now because it is a different car? No, the Toyota brand name has taken a beating, that is all.

Value in Investing ?

Are there parallels in investing? Maybe, some folks regard certain Brand Names in the ETF, Index Fund and Mutual fund world with more prestige than others, when in some cases what might be different? If it is an Index Fund what is different from other Index Funds offered by other investment shops (aside from tracking errors, but that is a big thing in this area)?

Do folks buy “name brand” ETF’s or Index Funds?

Feel Free to Comment

  1. I know, I’m being a vocabulary tighta**, but it’s ‘cachet’ when one is speaking of that unseen desirable added value kind of thing.

    Me? I bought the funds my advisor recommended I buy. They are a ‘brand’, but not one of the biggest. Maybe the MER is higher than others, I don’t know. I do know I made in one year what I made in the 5 previous in the ‘ethical’ fund I had chosen, and have almost completely recovered from the economic downturn already, without having added to the capital.

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