the state of FI's finances has been discussed here so thought I'd post this. Sounds promising to me:
People need to watch Sancho before weighing in on him to be honest. Just a "tricky winger" (20 goal contributions already this season...), "CHO better in every aspect" (except actually getting into a first team) are the kind of points that are ridiculously uninformed.
"I wonder how CHO would be viewed now if he had made the same move to Dortmund! It's a matter of circumstance", faulty logic, if I just played upfront for Barcelona maybe I could be as good as Messi. CHO may well be behind Sancho's backup in the pecking order at Chelsea next season.
He's been the best right winger in the Bundesliga this season and tops Europe's assist chart. Easily the World's top teenager.
The best players on the index have a way to go before they hit their fair value so I can't see the growth in them stopping yet.
In five months these players have returned this percentage of their current value in dividends (I've just plucked these lads off a spreadsheet but could equally use the likes of Rashford, Hazard, Van Dijk or even Naby Keita (5% yield for him!)):
So in a year with the same returns you are looking at:
All are young enough where age isn't a worry and that is without G&A dividends or including the fact that we have three months of treble media approaching as well as the later stages of the Champions League (which both favour these players).
That is an absurd tax free return and is paid in freely withdrawable cash, so why do we people think we need a dividend increase? (If you know of anywhere I could get the same returns let me know)
I can only assume it's because they are buying pure PB players to chase capital appreciation. These players are starting to reach their price ceiling and face three months of no returns in six months time.
Dividend increases should reflect that returns on players are not high enough (I've just demonstrated above that the returns are still very high at the top end) not reward traders who haven't thought about dividend yield when buying a player. If the best players start to hit 5% or less in div returns then we may have a problem.
See those were questionable buys because the PB potential of those players has changed since they hit the winning scores:
Alves- Old, injured , new manager
Pjanic- Ronaldo and Cancelo steal some setpieces, emergence of Bentancur as a ball hogging mid. Still a good hold for late Champions League stages when premium players really shine.
Griezmann- No Europa League (won most of his PB in EL last season)
Depay- Bit unlucky, you bought at peak price if you were buying over the summer. Did perform better when Fekir was injured though.
Milinković-Savić- Have to be patient or sell. He hits big scores a couple of times a season and then is fairly average the rest of the time. The data shows exactly that.
Koulibaly- New manager, no more Sarriball, no Jorginho.
You need to interpret the data a bit better and adapt to changing positions/roles, management, European competitions etc rather than just buying players who have won in the past.
Thought this info might prove helpful. Players with >10% yield already this season plus age. Interesting how efficient the market is with players towards the end of their careers near the top of the yield list which makes sense.
Note that pricing data is a little old so actual yield at today's price may differ slightly. Age is also inaccurate on some players but only by a year either way.
Edit: Should also mention this is all exclusive of inplay divs so yields will be higher depending on when you bought the player.
A couple of things to consider with Pogba.
1 it’s being taken as a given he’s going to move. The actual chance is still less than 50% according to bookmaker odds. Probably in the region of 30-40% (hard to get actual percentages until a “to stay” option is available for market balance but the chance of a move will be significantly lower than the odds imply currently).
2 Pogba at United is heavily undervalued at his current price vs dividend yield. His is by far the highest yield of any big hitting player under 30 and that’s before we come into media madness where it’s inevitable he will do well. Without the risk of moving I could genuinely see him as a £9+ player at this point in time based on returns and age.
So 60-70% of the time you’re getting a £9 worthy dividend winner for a cut price.
30-40% he drops, possibly to around £5ish, compensated by a large amount of dividends (genuinely wouldn’t be surprised with a over £1 per share in divs if a move goes ahead).
Good odds in my book at his current price.
@dionysusthyrsus interesting, where did you read that? I assume it’s ignoring div returns for starters. Pogba alone has trebled in value and returned a massive amount of divs. Sancho, sterling etc similar and the bottom of the top 200 is now £1 when I think it was about £1 in old money back then.
The problem with buying into nonsensical cap app is you are essentially buying a bubble when the player doesn’t have div potential to back it up. You can get the same capital growth in players with good intrinsic value who are less risky.
@dionysusthyrsus they both don’t produce high peak scores which makes it hard to win. Their price growth has been driven by the index doubling in value over the same period, that won’t go on forever (although I hope it does). You could’ve bought TAA, Sterling (City mid is actually pretty poor for the index), Van Dijk from their respective clubs and made far more.
@Black-wolf Sergio Busquets, Andy Robertson, Ngolo Kante, Fernandinho etc. All top class players, woudn’t but any of them in Football Index though (their prices are cheap for a reason). They just don’t suit how the Index is scored. Bernardo looks to be the same (he’s clearly nowhere near Messi’s level nor will he ever be come on)
@mike778 agree with most of that. I would say that the chart is a general trend so each individual does need to be looked at separately. I think Bernardo was about as good as he can be (prime performance) last season and still didn’t win a dividend. Would need to become a PB beast to even approach 20% of Sterling’s returns let alone 40% (just one example since Sterling is same age and team).
Agree with your £1-£1.50 valuation.
The problem with a player like Bernardo is that it is hard to see how he will justify his price in dividend returns at this point. He is over 40% of Raheem Sterling’s price, will he ever produce 40% of Raheem’s dividend returns?
I’d say that’s very unlikely (he won barely a fraction of Sterling’s divs last season) and they are the same age. So why would you buy Bernardo over Sterling? This is becoming more apparent the higher he goes.