Blog well worth reading



  • Came across this great blog about valuing players. Important points about age that I think traders should at least be aware of.

    Worth a read.

    https://footballindexdiary.blogspot.com/2018/11/why-age-matters-lot.html



  • I agree. However, part of the game is to find the next best thing who in the future people will buy with the guarantee of dividends. Seeing their price rise is just as rewarding, if not more more rewarding, but more of gamble.



  • @Lukeroro it's about risk vs reward with picking those players. Sancho had obvious star potential and unusually low risk for a teenager so I loaded up heavily early (should have done the same with Mbappe).

    However, I usually stick to the 20-23 bracket since they offer the potential rises combined with less risk since they are already playing first team football and it's easier to assess their potential. Has to be done on a case-by-case basis though.



  • Indeed.

    That bracket is probably the best bracket to invest in, especially as IPOs are getting higher.



  • @Lukeroro I like IPOs getting higher. Less pump potential and closer to actual value so you can't lose much. Chukuwueze a recent one who didn't rise much initially which provides very low risk.



  • @PB-man are the prices listed on the FI news page accurate?



  • @Lukeroro Yeah those are the IPO prices. Hard to get them at bang on that for the popular players but the smaller the difference between buy price and IPO price the lower the risk since player's can't drop below IPO.



  • As a new customer(7 weeks) who has regularly read opinions etc, I understand the importance of dividends, but can't see how this could be the only factor for prices right now. After all, most players will never win dividends, let alone enough to get near the price they can be bought at! Even with big guns, Messi and Ronaldo will never make their money back if bought today. Aren't we investing to a small(or large) degree in the power of the overall product here too, and the fact that if people are buying players for X amount now, as the product grows(hopefully) more people will also buy them and maybe more dividend opportunities, share splits etc will organically make our stocks more valuable? I do get the 'buy young' thing and although I don't invest time in looking for great young players, I have no player over 27 in my portfolio, but then again I am also trialling the next 6 months to see how it all pans out. If I make money and decide to stay in FI then I will undoubtedly look into a longer term strategy, but for now I just want to see if the demand is going to meet the heavy publicity and marketing that is being done by FI, hoping that I bought before more serious money pumps the market up as a rule? Time will tell!



  • @CraigM One thing that complicates things is IPO price. A player can't fall below that amount so that portion of the price should probably be ignored. For example Teji Savanier's IPO was 90p so at his current 1.72 value he would only need to return 82p to pay that value difference.

    I would be hesitant about buying a player I don't expect to return their value over their career since that would be buying a bubble. Young players and the big dividend performers under 30 will return this amount pretty easily (Pogba at £12 has returned almost £4 in the past year and is 25). Avoid players who will never win dividends.

    Some portion of the price will be factoring future dividend increases as well. If divs increase at some point over the three year hold then you are in the money, so some of that expectation should already be priced in.



  • From the blog; "When you buy a Football Index future, you are buying a chance to win dividends. That is all."

    I think this is crucial. Yes, value decreases with age, but I believe it is far overstated in this blog when it comes to the Index. Using the above statement, it would be far more pertinently applied to how over-priced the vast majority of youngsters are.



  • @Keegan's Bluff Which youngsters are overpriced in your opinion?



  • The ones who don't return dividends, and have minimal probability of doing so over the next 12/24 months. sancho is a decent prospect though, don't worry :p

    which older players do you think are over-valued?



  • @CraigM said in Blog well worth reading:

    As a new customer(7 weeks) who has regularly read opinions etc, I understand the importance of dividends, but can't see how this could be the only factor for prices right now. After all, most players will never win dividends, let alone enough to get near the price they can be bought at! Even with big guns, Messi and Ronaldo will never make their money back if bought today. Aren't we investing to a small(or large) degree in the power of the overall product here too, and the fact that if people are buying players for X amount now, as the product grows(hopefully) more people will also buy them and maybe more dividend opportunities, share splits etc will organically make our stocks more valuable? I do get the 'buy young' thing and although I don't invest time in looking for great young players, I have no player over 27 in my portfolio, but then again I am also trialling the next 6 months to see how it all pans out. If I make money and decide to stay in FI then I will undoubtedly look into a longer term strategy, but for now I just want to see if the demand is going to meet the heavy publicity and marketing that is being done by FI, hoping that I bought before more serious money pumps the market up as a rule? Time will tell!

    Its important to remember what you are buying. Its a bet on the player winning dividends in the future. Yes other things do affect the price but if the market was efficient and people traded logically then nothing else other than FUTURE dividend yield would affect the price.

    I think the problem is that when people say "there are too many variables to predict yield" it basically means you have no idea whatsoever how much a player is worth. As the index becomes more mature, people will start to have better attempts to project future dividends and there will be more accurate valuations. At the moment we are all pissing in the wind really.

    Re the above post. Honestly if a player will probably never win a dividend in real terms they are useless as an asset.



  • @PB-man said in Blog well worth reading:

    @CraigM One thing that complicates things is IPO price. A player can't fall below that amount so that portion of the price should probably be ignored. For example Teji Savanier's IPO was 90p so at his current 1.72 value he would only need to return 82p to pay that value difference.

    I would be hesitant about buying a player I don't expect to return their value over their career since that would be buying a bubble. Young players and the big dividend performers under 30 will return this amount pretty easily (Pogba at £12 has returned almost £4 in the past year and is 25). Avoid players who will never win dividends.

    Some portion of the price will be factoring future dividend increases as well. If divs increase at some point over the three year hold then you are in the money, so some of that expectation should already be priced in.

    What would happen if a player announced his retirement ? The player who died saw his IS price drop to 1p.

    Their trading price may not drop below their IPO price but it doesnt mean FI would buy them back off you for that price. A player announcing retirement could be literally worthless overnight.



  • @mike778 Davide Astori. Still trading as "Unknown Player" at 51p.



  • @Lukeroro said in Blog well worth reading:

    @mike778 Davide Astori. Still trading as "Unknown Player" at 51p.

    51p is the buy price. You aint market selling him so what matters is the IS price which is 1p. And if I remember, it dropped to 1p pretty quickly although not immediately. So you cant rely on the IPO price as being a players floor.



  • @mike778 He died and I don't think anybody owned shares in him so that's a very rare case. Just don't buy players close to retirement age and you'll be fine.



  • @mike778 said in Blog well worth reading:

    @Lukeroro said in Blog well worth reading:

    @mike778 Davide Astori. Still trading as "Unknown Player" at 51p.

    51p is the buy price. You aint market selling him so what matters is the IS price which is 1p. And if I remember, it dropped to 1p pretty quickly although not immediately. So you cant rely on the IPO price as being a players floor.

    Take a while for him to get market sold, very true! Aha

    Point well made.


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