LEGO - The Toy of Smart Investors

27 Pages Posted: 17 Dec 2018

See all articles by Victoria Dobrynskaya

Victoria Dobrynskaya

National Research University Higher School of Economics

Julia Kishilova

RB Partners; Independent

Multiple version iconThere are 2 versions of this paper

Date Written: April 2018


We study a new alternative investment asset - LEGO sets. LEGO is an iconic toy with diminishing over time supply and a high collectable value. A huge secondary market for LEGO sets with tens of thousands of transactions per day has developed since the turn of the century. We find that LEGO investments outperform large stocks, bonds, gold and other alternative investments, yielding the average return of at least 11% (8% in real terms) in the sample period 1987-2015. Small and huge sets, as well as seasonal, architectural and movie-based sets, deliver higher returns. LEGO returns are not exposed to market, value, momentum and volatility risk factors, but have an almost unit exposure to the size factor. A positive multifactor alpha of 4-5%, a Sharpe ratio of 0.4, a positive return skewness and a low exposure to standard risk factors make the LEGO toy an attractive alternative investment with a good diversification potential.

Keywords: Alternative Investments, Collectible Assets, Emotional Assets, LEGO, Portfolio Diversification

JEL Classification: G12, G14, G15

Suggested Citation

Dobrynskaya, Victoria and Kishilova, Julia, LEGO - The Toy of Smart Investors (April 2018). Available at SSRN: or

Victoria Dobrynskaya (Contact Author)

National Research University Higher School of Economics ( email )

26, Shabolovka st.
Moscow, 119017


Julia Kishilova

RB Partners ( email )

Smolenskiy Blvd., 40/2
Moscow, 119034

Independent ( email )

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