It has been quite a calm and somewhat normal week on Football Index.
It sort of feels like the last few months have been filled with uncertainty over Covid impacting football, changes in the platform and wild price swings. Now we are seeing a bit of stability and patterns are starting to become more clear.
For example, the Monday drop. Today spreads have opened up massively and as focused on in last week's FIC Weekly, we can currently be particularly profitable by buying and selling frequently based on these frequent fluctuations in demand.
Plenty of the biggest risers recently have been in Bayern Munich players. Lucas Hernandez, Kinsgley Coman, Robert Lewandowski and of course Joshua Kimmich have all risen considerably in recent weeks.
Bayern have been in unbelievable form and many of their players have been mopping up dividends in recent weeks. Although I do think such strong form is likely to continue in the short term and possibly for the rest of the season, it's important to remember how teams can change considerably over time.
Players that are dominant purely because of the strength of their team and their current situation can quickly become poor holds if their price gets built up too much based on their current, existing circumstances and based on their potential to earn matchday dividends alone.
Kimmich does currently look a fairly good hold, but his price rise and the fact it is built solely on PB and not MB sort of reminds me of the massive rises in the likes of Trent Alexander-Arnold (Last season when he was winning PB often) and also Jadon Sancho (When he was winning MB often).
Further to this point, the current paradigm to which the market is predominantly using to find value is mostly based on player's short term chances of earning matchday dividends. Last season we saw this during October/November because of the dividend increase and because of the bonus period.
Because of the removal of instant sell, I do not think we will see such a strong shift toward more speculative players but it is worth being aware of this current paradigm. Overall, my view on some of these PB players is that they are good value, but that there are also plenty of other players likely to hit high PB scores who are maybe out of form right now and will turn out to be excellent holds longer term.
Basically, watch out for PB performers becoming overpriced as if their PB scores regress to the mean, it is likely their price too will drop.
As mentioned above, the spreads tend to change often and on Mondays we usually see the widest spreads. Use this. We really can maximise our returns by bidding on Mondays and offering the same players at higher prices than what we paid for throughout the week and often we will execute trades over the weekend for profit when players are back in action.