Reality Check



  • @Dan-w

    Down £13 mate (-0.5%).
    I'm going to duck out for another week now I think, and hopefully when I come back next week it will be up slightly!



  • Actual photo of @ScouseSte

    0_1568148593141_Screen Shot 2019-09-10 at 21.49.42.png



  • Good luck, mine has been dropping for 3 weeks now. Fingers crossed hoping for an upturn soon. I have tried shifting some money around and swapping some futures but loath to instant sell and struggled to sell some to market.



  • @Dan-The-Man

    Hi Dan,

    Thanks for replying I want to clarify once and for all to you and Pagey that if both of my posts are read accurately I definitely did not say the only way to make money in the past, now or in the future is only via dividends or to hold the top players only!

    If read accurately I used the following phrases:

    With each passing month
    Becomes more established:
    Within 12 months
    Majority of Top 50 players have reached stagnation price
    When people finally realise
    But eventually
    There are still IPD plays available
    When the platform matures further

    None of this reflects your replies I was trying to articulate the part journey FI has reached.

    To explain further:

    The majority of recent IPO’s in the view of most traders are now overpriced compared to the past and cannot be bought at value prices.

    Therefore there are only previously released players at lower prices (less than £1) on the index and as more and more traders trawl through them there will be less and less that have any chance to really break through.

    Where cheap players increase in value FI seem now to increase spreads a little further.

    When order books are introduced FI instant sell will be a backstop only and spreads will be even wider.

    Therefore I was stating that over the coming months and maybe in a years time - it will be substantially harder to make money at the lower end as there will be no decent cheap players as the odd good ones will already have been identified and bought - spreads will be too wide for many IPD flips and no new cheap players will be added as they are being IPO at significantly higher prices. So for the vast majority of traders wanting to make good long term profits we will have to accept a different world where the majority of players are accurately valued.

    The diversion from this will be that there will be a significant number of traditional style gamblers who get short term fix’s by in effect gambling on a match by match basis. This will still enable other strategies but in my opinion not as easily as currently.

    Good luck to you and all, lots of strategies can and are working for all and as a final thought for those that enquired about future returns - I can add that I have made circa 150% on my money over 18 months but have set the target of just 25% for the next 12 months unless there is a significant dividend increase.

    Fletch



  • Therefore I was stating that over the coming months and maybe in a years time - it will be substantially harder to make money at the lower end as there will be no decent cheap players as the odd good ones will already have been identified and bought - spreads will be too wide for many IPD flips and no new cheap players will be added as they are being IPO at significantly higher prices. So for the vast majority of traders wanting to make good long term profits we will have to accept a different world where the majority of players are accurately valued.

    I agree with nearly all you have stated and you make a strong reasoned argument.

    But.... too suggest that in a market that is constantly evolving with new players coming in, older players declining, loss of form, return from injury, sudden upturn in form, move to a PB club that there will less opportunity is something I cant agree with. There will always be opportunities to pick up players at a cheaper price than the established stars and I cant see how that would ever change. Yes it will not be as easy as it has been but there will always be players that will have significant rises otherwise whats the point.

    The gambler in all of us must believe that or the index will quickly cease to exist.

    If you do not believe that to be the case then I am not sure how you intend to make any sort of return on your investment.

    I agree with nearly all you stated but cant agree on this point.

    Good luck with your strategy



  • As per all 3 threads money will still be able to be made by good selection of players that provide above average dividend returns and as you state capital appreciation in specific circumstances just not at the rate we have made money in the past



  • @Fletch Agreed



  • @ScouseSte not too bad overall pal. Internationals wont of helped..



  • @Fletch Seeing as though you have mentioned order books. Do you believe they will benefit the index?
    For what it’s worth, I’m not convinced that we will see the introduction of it and I kind of hope we don’t as I don’t necessarily think they will be of benefit.



  • @Fletch said in Reality Check:

    So for the last couple of weeks I have continually read articles from traders about player price drops, large spreads on players to instant sell and if a player has increased in value should he be sold. So now might be a good time to remind everyone that this is a gambling site and not a money tree!

    With each passing month as more traders join the index becomes more established and just like any other index there will be ups and downs but more importantly there will be volatility. However just like when buying stocks and shares some people will do full due diligence whilst others will buy what they hear down the pub whilst others will just buy anything and more importantly will sell on emotion not sense.

    With the platform now a little more established there are a higher percentage of traders that truly understand the concept of value so it will become less easy to make the returns we have become used to for what in effect was little effort or skill.

    If the platform only reacted in a sensible and logical way only a handful of players would ever be bought and FI would make little money, however due to the fact that gambling is emotional and people do it with little or no study or planning means that it has and to an extent still is possible to make money based upon other traders gambling and emotional decisions.

    To explain: If the index is rational there would be a fixed percentage return we would all accept for the risk taken with our capital, then using known statistics and sensible projections we would look at a players dividend potential over the next 3 years and work out the price he should be. I actually believe that a lot of the top 50 are close to these prices so hence there stagnation. However this stagnation reflects they will earn you money over that period and dependent on if their performances get better you will get an increased return or if they are injured or decline your return will fall.

    The current fascination with young players is easy to understand as traders are scared on missing out on the next big thing so wish to buy on the cheap. However this is fraught with danger as you are now paying top 20 player prices for unknown future returns and for every 1 you get right there may be 10 you do not.

    IPD are a brilliant way for FI to generate revenue as they play to the gambler and with large spreads and increasing prices my guess is more people lose than win and that within 12 months the players that can possibly make you money will be priced accordingly and losses will become more the norm.

    Cheap players - this is the real bonkers part of the index - between everybody I read about on the forum you must hold at least over 400 cheap players sub £1.00 saying they will double. However over the last 18 months I am guessing these players or similar account for less than 5% of all PB wins never mind MB wins. However currently they make money as others also buy them but this can only end in tears when finally everyone realises for the purpose of the index they are dog shit!

    Do not get me wrong there is money to be made at all levels but eventually there will be enough sophisticated traders understanding value that it will become a lower returning more boring environment that also caters for short term gamblers.

    If you have got to this bit you really must have little to do as when re-reading this it is particularly boring 😀

    Good thread @Fletch and I enjoyed reading it, but then I am boring so that probably explains why.

    I agree with everything you are saying, in particular the point about effort required to make money. I've been on here for the best part of a year and a half and I've seen plenty of threads started by inpatient people who have obviously dived straight into FI, without reading the rules and have expected to make profit. I'd guess that many of these have seen the boastful screenshots on Twitter and signed up in the expectation that they just need to turn up to get a chunk of the money tree.

    Lots of us have made great returns as a result of new users and to pretend otherwise is disingenuous. I am sure many people's commission payments outweigh their dividends. Mine do, and that clearly shows my profit is coming from an increased user base. I've seen plenty of ignorant people both on here and Twitter who paint themself as some 'master trader' because they've made good profit, and it's more the case that they got in at the right time and have ridden the wave, rather than some exceptional level of skill. These people are likely to get the biggest wake up call when it becomes more about skill, although we're still a way away from that I think.

    My expected rate of return has fallen slightly over the last month, but it's still excellent compared to any other option open to me, just not as quick as it once was. This is possibly because I haven't been as active as I had been, but also likely to be due to the increased skill elsewhere.

    I expect FI will continue to grow for the foreseeable future and FI have presumably put themselves in a strong position where they can hopefully afford a dividend rise to help the market grow organically. Realistically though there will come a point in time where people will have to be happy with lesser yields on players they hold and so people's attitudes will need to change. It's not normal to feel entitled to a 100% return over the course of the year.

    I do still think there is a long way to go though and many other developments that will help FI progress. I know people like to repetitively have a dig at FI over tech and customer service but one thing they have clearly shown is that they're very very good at growing their product. I trust them to continue to do this.



  • @Timothee-Atouba

    I do believe we will see them but not until the new technology is ready. The reason being is that they will increase FI’s profit margin substantially and probably improve there cash flow.

    To explain:

    Using all current players priced at £1.50 there instant sell price are £1.45, £1.46, £1.41 and £1.40 which reflects the risk involved and recent trends in buying or selling of that player.

    Therefore when order books are introduced if the player is priced at £1.50 but you cannot get a buyer at that price you will start to lower the price you are willing to sell at if he still does not sell as nobody wants him then FI will be a buyer of last resort and offer a price which is probably lower than current.

    My guess is that all instant sell prices will become a standard % lower than the buy price and at a guess say 10%. This means that offloading unwanted players will involve much more skill and timing. However for the compulsive gamblers and one day flippers the risks will increase dramatically.

    It will be very similar to the Betfair model in the early days - I was a first day customer of there’s and the buy and sell prices then were much further apart from todays where the margin is so tight.

    Personally I think it will be brilliant for thoughtful and serious investors as you will be able to buy players at roughly what todays instant sell prices are, it will be very good for FI but will be disastrous for the compulsive short term gamblers.

    • by serious I do not mean the heavy hitters/rich I mean those that study and have a solid strategy 😀


  • @Fletch Interesting thoughts. I think that visually, low liquidity in some players, especially at the lower price end could slow trading. From their p.o.v I see it especially slowing a lot of the ipd market when people can see a huge spread and probable little market sell options in front of them. At present that’s disguised with a decent value instant sell offer.


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