What if you bought Beanie Babies (Princess bear) in 2000?
Alternatives · Toy. The hindsight answer, year by year, against the only benchmark that matters.
Could you have picked it? Play0.0× · S&P 500 same money: $4,626
$1,000 in Beanie Babies (Princess bear) at the start of 2000 would be worth about $30.00 today. A plain S&P 500 index fund over the same years would have made more — the boring option won.
What happened: Beanie Babies (Princess bear) turned out to be stuffed with air.
The story
Beanie Babies were small beanbag animals made by Ty Inc., which turned a children's toy into one of the great speculative manias of the 1990s. Ty deliberately limited production and "retired" designs, creating scarcity that collectors interpreted as investment value. Price guides published prices that seemed to only go up. Princess, a purple bear released in 1997 in tribute to Diana, Princess of Wales, became one of the most sought-after pieces.
The flaw was that almost everyone was buying to hold rather than to play, so millions of mint-condition bears sat in protective cases. When Ty announced in 1999 that it would stop making Beanie Babies, then reversed course, the spell broke. By the early 2000s prices collapsed and stayed there. Occasional online listings asking huge sums for Princess bears still circulate, but listing prices are not sale prices. A 2000 buyer kept only a few percent of their money.
The lesson: When everyone buys a collectible as an investment and nobody consumes it, apparent scarcity is an illusion and prices depend entirely on new buyers arriving.
$1,000 invested at the start of each year
| Bought in | Price then | Worth today | S&P 500 would be | Multiple |
|---|---|---|---|---|
| 2000 | $500 | $30.00 | $4,626 | 0.0× |
| 2003 | $20.00 | $750 | $7,727 | 0.8× |
| 2005 | $10.00 | $1,500 | $5,763 | 1.5× |
| 2007 | $10.00 | $1,500 | $4,789 | 1.5× |
| 2008 | $10.00 | $1,500 | $4,626 | 1.5× |
| 2010 | $10.00 | $1,500 | $6,071 | 1.5× |
| 2012 | $10.00 | $1,500 | $5,312 | 1.5× |
| 2015 | $10.00 | $1,500 | $3,301 | 1.5× |
| 2018 | $15.00 | $1,000 | $2,519 | 1.0× |
| 2020 | $15.00 | $1,000 | $2,092 | 1.0× |
green = beat the S&P 500 · red = lost money
Best entry point in our set: 2005, turning $1,000 into $1,500. The S&P 500 from that same year: $5,763.
Now try it without hindsight. The wheel decides the year and the asset class, you pick the position, ten seconds a pick, and we simulate to today. Beanie Babies (Princess bear) is one of 258 positions on the wheel — including the ones that went to zero.
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