Approaching the January 2020 Transfer Window

The 16 players highlighted in transfer blogs have increased an average of 15.8% in price. You can see the price differences below.

Price Differences in players highlighted due to transfer speculation

These price increases are an example of how the market has already been largely influenced by transfer speculation as we approach the January 2020 transfer window.

Who to buy and who not to buy?

Who not to buy?

First of all, it is very important to be aware that many transfer targets now have potential transfer speculation built into their current prices.

If a player has already increased considerably in price in the last 6 weeks, but, has not performed any better than usual in that space of time - there is a fairly strong chance they have increased due to speculation that they will gain future transfer link or has already been linked with a move away.

It is likely we will see many players who do not transfer to another team, but, have recently gained transfer links and subsequently increased in price start to drop in price towards the end of January and then continue to drop in February.

The extent to which the player drops will likely depend on if there are many other positive reasons to buy the player and how much their price has been built up on a potential transfer.

Players which are likely to be most negatively impacted if they do not secure a transfer in the January transfer window (In order of impact):

  1. Players who's price increase over the last 6 weeks makes up a high percentage of their total current price

  2. Players currently in non-pb leagues

  3. Older players

  4. Players who will not feature in any upcoming tournaments (which could be future market trends) such as the later stages of the Champions / Europa League or EURO 2020

Jarrod Bowen was first highlighted at £1.35 and is a great Championship player, however, his price is now very much built up on a Premier League transfer this January which arguably makes him a risky hold as this price is likely to drop if a transfer does not go through

It is therefore risky to buy players now which carry many of the above attributes. However, there will of course be some players which do secure a transfer or gain further transfer links and possible media dividends and subsequently increase in price further.

Who to buy?

With the above being considered, it may be wise to buy players which could gain transfer speculation through being a strong player, but, do have other positive characteristics to fall back on if they do not secure a transfer this January transfer window. Therefore, buying players with the opposite characteristics as the players above is certainly less risky.

Lower risk players to buy ahead of and during the January transfer window:

  1. Players which have not already increased considerably in price in the last 6 weeks due to transfer speculation

  2. Players currently playing in a PB-league

  3. Younger players

  4. Players who will feature in an upcoming tournament (which could be a future market trend) such as the later stages of the Champions / Europa League or EURO 2020

*More players who fit the above category will be highlighted before the end of this year.

Another key point is that some players who currently have transfer links, but, are yet to rise considerably in price may still be of value over the next few weeks.

When to sell?

One of the hardest parts of trading during a transfer window is knowing when to exit a trade. The first thing to say on this is that it can be extremely difficult to get this part of the trade perfect.

Selling at a peak price is difficult as live news regarding possible transfers can shift a player's price in seconds as there will often be many traders reacting to the relevant news very quickly.

Unless you have the time to constantly monitor transfer news, it can be wise to sell when a player has already increased considerably in price due to transfer speculation, but, before the transfer has been confirmed. You may miss out on say the extra 5-10% increase in price, but, you bank the profit and avoid say a 15-25% price drop if the transfer talks break down.

*How early you decide to sell a player with transfer links is likely to depend on how much time / freedom you have to check for transfer news - even if you do have a lot of time to check regularly, it may still be wise to sell earlier on in case transfer talks break down

The players on the right (Prices courtesy of Index Edge) are the 10 most expensive transfers from the last transfer window. Interestingly, the average current price / peak price is 81.5%. Much of this drop in price has been caused by transfer targets becoming temporarily over-inflated in price as the speculation of their transfer builds up and then their price will often slowly decrease in value over time. However, Matthijs De Ligt and Harry Maguire have decreased the most, which is partly due to center backs in general suffering since the performance matrix changes.

This tells us that player's prices are often built up on speculation and sometimes player's prices become temporarily over-inflated with a lack of consideration for their actual value in relation to their potential dividend output. This can offer us a great opportunity to sell for profit via capital appreciation.

Players which do not secure a transfer often drop much more in price too. Paulo Dybala's price graph below highlights the risk in buying players after they have already increased in price due to reports suggesting a transfer is going to go ahead.

The sharp increase and then decline in Paulo Dybala's price graph was caused by transfer talks breaking down

Key Points ahead of the January transfer window

  • Many players already have a potential transfer built into their current prices

  • Players that already play in a PB league are less likely to drop in price if transfer talks break down

  • High quality, younger transfer targets may be safer holds than older transfer targets

  • Many players decrease in price over time after the transfer speculation surrounding them starts to wear off

  • Many players that do gain a transfer will not earn media dividends - moves to strong Premier League clubs are more favourable

  • It can be risky to buy players after they have already increased in price due to an expectation of a transfer

  • Taking profits on players with transfer speculation before a move is confirmed is often a less risky decision to make and can end up being more profitable

  • The Media Dividends a player that transfers earns may be less than the price drop after they stop earning Media Dividends meaning buying for the Media Dividends is not always worth it


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