Overpriced IPO - in the event of zero interest.

  • Can someone from Football Index please explain what will happen to the price of a player who's floated way above their true value? (which to my reckoning will be the case for at least 80% of the new IPO players mentioned in today's 1pm announcement).

    This appears to be the question on many traders lips today and must have been discussed at length within FI prior to the announcement.

    Since discovering FI I've seen some brilliant innovation and an amazing platform but find some of the things strangely amateur, there's no excuse for including Kolasinac in the IPO list when he exists in the 1st team already and pricing King at £1.50 when he's already been relegated at 40% recently.

    For most people on here who love football and the financial aspects of player trading; working for FI would be a dream job so it's frustrating to see silly mistakes.

    Personally if players I've got my eye on don't become fairly available I'll lose significant interest in the platform.

  • Can I have the link to this announcement please?

  • @CraftyGuy Thanks

  • @Agatello

    The inclusion of players already in the top 200 is such a basic check its unbelievable really.

    In all honesty, I think they're so worried about low balling prices that they've gone too high. By the end of it some of the current top 200 will not be eligible for media buzz because of over priced players.

    When was the last time a promoted player hit £3? Of the current 200 only 10% are above that level. Its hard to justify any IPO players coming in above £1.50 in my opinion.

    Still, I'm reasonably happy as it hasn't impacted my approach - YET.

  • Javier Hernandez is in the list too !!

  • I am quite happy that they've massively overcompensated. The loss of a couple of MB wins due to IPOs being too high is nowhere near as bad as the massive crash that would've occurred if they were all too low. Still it is incredibly amateurish how many mistakes there are here. Kolasinac and Hernandez being included are the big ones, but also no indication of what happens to a player if no-one buys him. The announcement also said it was going to mention some updates to the platform, it hasn't!

  • The mistakes & the new features being mentioned for today but not happening are a bit annoying. I've chucked a bit of money back on players earlier than I planned though, as I can't see the players listed impacting prices that much - other than pinching media buzz spots

  • @pwp23

    I did the same. I deposited thinking it would wait til November but I really don't think there will be much impact to the current 'big players'.

  • I've rang them up for clarification but the polite lady on the phone has had to refer the query.

    FI make no money on a static player, makes no sense to flood the market with dead wood apart from having to pay out less on PB's because random players win a fair share and no-one owns them! If that's the agenda then it's a very shady one that'll cause distrust in the platform. Surely they make significantly more money on active players.

    The excitement of November has the potential to become the biggest damp squib of the year. Sort it out FI!

  • @FI_Konrad can you shed any light on this query? also can I ask why the first 250 IPO's don't contain many (if any) of the players people have requested on your thread asking for players to be added to the squad???

  • Interesting everyone looking at it from this viewpoint.

    Assuming FI have done some research into these players and the IPO price is close to the present value of their future returns based on Opta stats, is it not possible that Messi et al are undervalued in the current market?

    Only came to ‘the game’ recently but just a thought...

  • the only way that could be a valid explanation is that "if" the entire platform was undervalued which isn't possible because at the end of the day the accumulation of every invested penny is simply one big pie which is currently divided up amongst 200 assets.

    Take Milner and King for example, Milner played the majority of games "last" year and took penalties etc, King was on fire for the 2nd half of "last" season (I stupidly backed him at 80/1 for the Golden Boot this season before they bought Defoe) so the prices have clearly been calculated from historical Opta Data.

    I accept a valid response could be "how else are they meant to do it?" and understand the reasoning behind higher prices to prevent Capital Flight but many traders still believe that regardless of the new influx the top PB players will still win 90% of the time and as such as happy to ignore the vast majority of new players.

    Even if new players IPO'd at 1p then I think an astute trader would sense opportunity rather than fear and in turn this would create more activity and more money for FI. When it was announced without the stupidly high IPO's the market experienced a boost with most people thinking the new players would IPO around 5p-15p!

    I simply can't understand the benefit to anyone of pricing them so high. Happy to listen to people's views that think their portfolio has been protected but come December their portfolio will still win\miss out on exactly the same amount of PB's regardless of how much the cheaper players are valued at!!

    The only answer that makes any sense is that people don't trust their own judgement!

  • Your first point reinforces the fact that the market is undervalued though.

    Current prices are based on the “pie” of money which is divided up rather than the future returns expected from a future.

    It looks to me like there are essentially two valuation bases - pre and post IPO.

    And to me, futures issued pre IPO are the ones undervalued

  • That's what gets the market moving, no matter what line of business you apply it to - if something is overvalued it just stagnates.

    I hope I'm wrong but I honestly can't see those players shifting one bit at those prices. Hence wanting to know what happens then - the lack of clarification is baffling!

  • Based on the current model they will remain at that price because as far as I have read the market moves based on buys/sells of 100 futures rather than being created by a market maker - ie prices are controlled by FI to create liquidity.

    Once that is established, the existing 200 players will be shown to be undervalued, meaning people will purchase them. That will bring the IPO player valuation in line with the market.

    Based on the way the market is currently ‘created’, the IPO players will not fall in value because no one will own futures in order to sell them.

    In the absence of any further clarification, that is how the market should work.

  • Love your optimism, it's guaranteed these players will be worth what they're floated at some point in the future... I just don't think it'll be anytime soon :-)

    If people are wrong about the frequency of the current top 200 winning the PB's and it becomes more of a lottery (hard to argue it won't be in the world of defenders) THEN we're likely see Capital Flight and a probably crash because who's going to lump on Koscielny at £1.30 on the off chance that he "might" win a PB in the foreseeable future - gamblers! The main reason FI is so attractive is that we can apply a level of intelligence to proceedings and formulate a profitable strategy.

    People selling sh*t loads of Messi and investing in Adrien Rabiot @ 60p for example isn't Capital Flight it's just reevaluating where the value may be. (I don't think anything would cause a massive sell-off of Messi or Kane to be honest because they'll milking the dividend cow as it is - even if the price did drop they'd climb back to where they are quite quickly because the platform would be far more exciting with more people joining)

    I could well be horribly wrong and maybe I'm just bitter cos I wanted to invest big time on the diamonds in the rough which sadly now looks impossible.

  • At the end of the day a share/product is only worth what people are willing to pay. No one was buying king when he was 40p so what makes them think anyone is going to buy him at £1.50. Regardless of how players have performed in the past you can clearly see that players like milner and King are going to be extremely overpriced in today's market.

  • anyone got a link to the player price list


  • @FI1 said in Overpriced IPO - in the event of zero interest.:

    At the end of the day a share/product is only worth what people are willing to pay. No one was buying king when he was 40p so what makes them think anyone is going to buy him at £1.50. Regardless of how players have performed in the past you can clearly see that players like milner and King are going to be extremely overpriced in today's market.

    Part of the lack of value in top 200 josh king was that people believed they would lose all their holding eventually when he dropped out the top 200. As a result, he was sold down to 40p.

    There is no longer that risk, which makes him a much more valuable player than 40p.

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