The Brilliance of the FI announcement



  • I have spent today thinking about the introduction of the matching engine by FI and can only congratulate them on an remarkable business decision and how so much of the chatter on the forum has missed the point. The doomsday merchants you know who are have focused on this move by FI when they really should have looked further ahead.

    Let me explain

    Currently you can only bid to buy a player (1o x 300 shares maximum per player for any trader at any time) this action in itself does not reduce a players market sale price value.
    When a trader decides to accept a bid at a price below market sale price this again will not effect the market sale price of all other shares.
    How many of us have the ready cash to sit in bid offers on all the top players, very few i would suspect and for the big time players who are few and far between having 3,000 shares in play per player at any time will use up £100,000's of capital so there will in effect be just a few active traders bidding.
    It may be busier at first due many traders feeling trapped with no instant sell having been available but this will be short term and the sales will be out of need not the new system
    Initially there is no 2% commission but once this starts it will further reduce activity
    Market makers (maybe FI) may offer a price on all players at 40% lower to provide liquidity and if taken this may drive prices down just like instant sell does now.

    The Brilliant Bit

    We get used to the new system, player prices stay stable may even rise with the return of football then sell bids are introduced when the 2% commission comes into force.

    Lots of players listed as no suitable bid offers were previously in place - each 900 shares listed drives price down 1p and players rush to exit as fear increases - FI make lots of commission and prices fall to a more attractive level and FI increase dividend payouts which makes the platform far more attractive to new traders.

    Therefore I see Small increase, biggish decrease and then long term growth - it could be a very interesting 12 months but I look forward to the ride and congratulate FI on a very clever plan



  • @Fletch good analysis and in time I think you'll probably prove to be right with parts of, one thing I'm not so sure you're right on is with regards to open bids

    0_1589487785383_Screenshot_20200514-212117_Football INDEX.jpg

    A max of 10 x 300 share bids per footballer, not per trader.

    I did send someone at fi a dm to ask a couple of questions and this was one of them.

    However this does lead into your other theory about money makers putting in bids at 60% because they could then do this for almost every player so that there is at least a sell figure. They have different levels of access to the market to ordinary traders so maybe their commission % is agreed lower as part of this. I've also posted wondering whether they could use money makers to remove shares from circulation

    But the other factor is that whales like EJ could then pile in multiple bids on numerous players and make a killing, especially early doors when there are probably need the money out now to live on due to the pandemic etc

    It definitely looks like an interesting time ahead



  • edited that bit - thanks



  • @Fletch noooo lol

    It says a maximum of 10 bids per footballer at any one time, with up to 300 shares per bid.

    So essentially you could choose 100 players and put in 10 bids at 300 shares each, meaning you have a total of 1000 bids in total......this is the way I've interpreted the wording but as I said I have asked for confirmation



  • @Ddr

    Yes noted and the post is edited to reflect the cost of doing that



  • @Fletch sorry my bad I'd just misread how youd changed the wording towards the start.



  • @Ddr

    No worries - I have a feeling market makers will be able to have unlimited bids but not have to deposit all the funds for each bid just say deposit £100,000 from which each sale takes place so in effect they could have unlimited bids but just keep topping up a deposit with FI



  • @Fletch said in The Brilliance of the FI announcement:

    @Ddr

    No worries - I have a feeling market makers will be able to have unlimited bids but not have to deposit all the funds for each bid just say deposit £100,000 from which each sale takes place so in effect they could have unlimited bids but just keep topping up a deposit with FI

    Just like a retainer fee essentially, interesting idea



  • Yes as this will ensure just like betfair that there is a price for everything no matter how low - so in this case it would allow them to set a bid AT 60% of the player price for all players without using up all there liquidity and after that they could pick and choose which players they have more active prices on


Log in to reply