It’s easy to sell a physical product. Just put it on Craigslist and within a few hours, you’ll have plenty of buyers. But what do you do when the scenario isn’t so simple? Here is an awesome story of how you can make good money selling a product that doesn’t even exist. All it takes is a little creativity and some smart thinking. Like J Money says, ‘you’ve gotta be creative in this bizness.’
My brother constantly asks me financial questions. In the last month, he has gotten serious about his finances, asking about 401(k)s, IRAs, setting up Mint, and started a Lending Club account.
Well, it turns out that the financial intelligence runs in the family after all.
Right now he lives in the San Francisco area, so when the Giants made the playoffs, he immediately snagged tickets. He went to game 1 of the Divisional Series against the Braves, enjoying seeing Tim Lincecum strike out 14 batters.
He also got 4 tickets to game 6 of the World Series at $85 apiece. Why was this so exciting? Because he was hoping for the Yankees to make it and to be able to watch his team in the World Series. So for three weeks he turned into the biggest San Fran fan.
Unfortunately, the Yankees lost, but as luck would have it, the Giants made it to the Series. With 4 tickets, he knew he could sell them for a heft price: try $600 each. The only issue was that if the series ended in Texas, before game 6, the money would be refunded, meaning his total earnings would be a big fat goose egg. So after 2 games, the Giants were up two games to none, and he had to something to protect himself.
So what financial move does a math oriented person do? He hedges his bet. He sold the tickets on StubHub for about $2,300 total. He then went and placed an $800 wager that the World Series would not even reach game 6. The bet would pay $2,000 if he won, meaning earnings of $1,200.
So let’s look at the two possible scenarios. If Texas won at least 2 out of the next 3 games, he would be make $2,300, but lose the $800 bet plus be responsible for the cost of the tickets. Total earnings? $1,160
If the Giants won 2 out of 3, he wouldn’t be able to sell the tickets and would get refunded his $85 each, and he would make $1,200.
While his potential earnings decreased by over $1,000, he was able to mitigate the risk of leaving it all up to chance (and unclutch Texas pitching).
And in the end, Texas wasn’t able to win those two games, and instead of hanging his head about the potential windfall, he earned $1,200 by selling tickets to a game that never took place.