FIC Weekly 21.09.20

It has been quite the week on Football Index. I am sure most readers of this blog remained calm and did not panic earlier in the week, but nevertheless throughout this blog I share general advice on what to do during a dip in the market. I also discuss the current IPD trend and more.


Up until Thursday, there was widespread panic as prices of players fell throughout the platform.


A few traders would have chosen to sell at very low prices, but this would have been a bad call.


When the market is dropping and traders lose confidence, often it is best to try and avoid your emotions. Because of the fear of further loss and how this impacts you, your emotions will often tell you to sell. Instead it is almost always best to put your trust in rational, logical numbers.


By putting your faith in numbers instead of your emotions and the plethora of frustrating pyschological biases that result in poor human decision making, you will make better returns.

When prices fall = Players become more intrinsically valuable


When prices rise = Players become less intrinsically valuable


Taking advantage of drops in the market


Understanding that players dropping in price actually makes them more valuable and therefore makes it a worse time to sell is extremely important. It helps to instill a calmness when others are selling and can also help avoid us getting sucked into temporary market trends.


Whenever I look back at my own trades or the hundreds of players that have been highlighted on FIC over the last 12 months, I tend to notice how the more the player had increased prior to being highlighted - the weaker the suggestion turns out over time.


Conversel,y when there are times when the market dips, highlighted players tend to fly up. We saw this during the Covid 19 dip. The 35 players highlighted just after this dip rose an average of 11.98% within 30 days.

Buying players when they are out of favour can be rewarding, Jota's move to Liverpool proved very profitable.

We also saw similar results when players were highlighted on the site earlier this week. 3 of the 6 players rose over 19% within just 1 week:

  • Under rose 19.58%

  • Jota rose 27.5%

  • Mittelstadt rose 30%

Football Index's Intervention


Another reason why I often remain confident when the market is dropping is that Football Index tend to intervene if things do get really bad. It is in their best interest to do so.

The market update on Thursday was extreme. It placed stabilisiers on the full order books system. But, are these stabilisiers too tight and can the market really move?


Well the market can certainly move as we have seen this weekend with wild price swings. The problem is that now we are back to seeing ultimately 'fake' figures on our screen when we look at our portfolio.


Football Index needed to do something drastic as it was mostly panic and fear leading to drops rather than rational decisions. The change to the VWAP (Volume Weighted Average Price) was necessary but the the introduction of an Offer Zone floor 1p under the Buy Now Price is leading to some particularly wide spreads again.


Hopefully once the depth of the market and NASDAQ technology is added combined with no longer having such an attractive IPD promotion, we will have a more stable, healthy market without the need for such a small offer zone.


*Football Index's extension of the Market Downtime (Until the end of September) should also help to alleviate some of the concern and panic over sudden drops.


IPD Players - What to do?


Hope is sometimes all people have to keep them going. For many, hope is currently the only reason they are still holding IPD players. The hope that your IPD players will earn a huge IPD payout in these final 9 days of the promotion is so attractive. Seeing others make huge returns during the IPD promotion can lead to fear of missing out too.


But, is it wise to still hold IPD players when most have only one or two games left?


It will depend on many players, but generally I would say now is far from the best time to hold IPD players. Such players' prices are currently held up by a system that does a poor job of reflecting the true demand of players. In just a couple of weeks when the 5X IPD promotion is over, I would expect the market price of the majority of traditional 'IPD players' to drop.

Spreads are starting to widen on many strong IPD players

Buying IPD players is currently a strong market trend and we are now approaching the end of this trend. Therefore, it may be best to sell players into the speculation ahead of this weekend or in any games where they do earn IPD before the end of this month.


Where will money in the market move to next?


Once the market becomes more stable in a few weeks, I would imagine that money will just naturally flow into the most in-form players. But, this will be form based on PB scores rather than simply goals, assists and clean sheets.


Due to the matchday dividends on offer being so valuable and prices not yet reflecting the potential returns, we may well see a similar, general trend to what we saw last season where high PB scoring players benefit the most.


Of course, to help identify the most valuable players, there will be more highlighted players added to FIC and plenty more content coming over the upcoming weeks and months.

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