Identifying Players To Buy on Football Index
Updated: Jun 27, 2020
Whether you are adding new players to your portfolio, or topping up existing holds, buying and selling players on Football Index is the core of the platform. In this article, I am going to look a little closer into the selection of players to buy and the processes and options available.
For most traders on Football Index, there are few things more exciting than the opportunity to buy players and watch them grow in value. Whether you prefer to find hidden gems, or put money into the king of the index, read on for a few thoughts on selecting which players to buy and which method of buying may be best.
We've talked in previous posts about the importance of planning and building a diverse portfolio and deciding on a strategy. When it comes to strategies and players which fit them, there are no right or wrong answers and that the beauty of Football Index is the variety of opinions and strategies.
Which players to Buy
To recap briefly and expand on my previous thread on diversifying your portfolio by holding a range of players covering the 8 core categories, the below list gives a broad overview of the main categories which players on football Index fall into, the typical player type and some examples at the time of writing (June 2020).
Typical players: Those who feature regularly in the media and score highly whilst challenging for performance dividends, and having a large amount of potential for future dividend earning
Examples: Jadon Sancho, Neymar, Paul Pogba
Typical players: Those who play for top clubs with large amounts of possession, involvement in the game and good goal/ assist record. See further discussion below on players who fit into this category and how performance matrix changes could influence future dividend potential
Examples: Joshua Kimmich, Toni Kroos, Lionel Messi
Typical players: Those who regularly feature in the UK media, either because they are high profile English players, English based international players or those linked with a transfer to the Premier League. See the post on Media dividends for more on this. (link)
Examples: Jadon Sancho, Timo Werner, Paul Pogba, Mo Salah
IPD (In-Play Dividends) players
Typical players: Those who regularly score, assist goals or keep clean sheets. Usually lower priced players, often playing for smaller clubs.
Examples: Jamie Vardy, Danny Ings
Typical players: Those players linked to Premier League clubs or likely to move to an eligible league from elsewhere. Also those expendted to make a favourable move where they will receive a significant boost to their potential for dividends
Examples: Timo Werner, Thiago Almada, Hakim Ziyech
Typical players: Young players with regular first team football at the top level (international, European competition, top 4 in the league)
Examples: Jadon Sancho, Erling Braut Haaland, Kylian Mbappe
Typical players: Those who consistently represent their country at a high level and are likely or very likely to feature in qualification matches and international tournaments
Examples: Harry Kane, Kylian Mbappe, Cristiano Ronaldo
Typical players: Not currently playing in an eligible league or are out of favour but circumstances likely to change.
Your portfolio will likely consist of players from more than one of these categories above and deciding who to buy comes down to personal choice and opinion. Having said that, there a few key questions in addition to basic statistics which I ask myself when assessing a player
Goal attempts & goals
Accuracy of play (long balls, shots on target vs possession lost etc)
For these, a good data provider will be able to guide your decisions. The last one on the list, player movement, is something I feel is underrated on Football Index. In addition to the core statistics, heat maps are very useful to me in determining how involved players are in different phases of the game. Whilst stats can tell us a great deal about accuracy and general play, it's difficult to gauge how this translates into teamwork, and overall involvement in all phases of the match. For me personally, I prefer to choose who show a greater involvement as this in theory increases their opportunities to acrue performance points. Basic examples being a forward player regularly dropping deep and heavily involved in the build up play vs an out and out centre forward who relies on goals to challenge for performance dividends. The two heat maps below of Lionel Messi and Timo Werner illustrate the difference.
Another example, being a box to box midfielder as opposed to a defensive holding midfielder or winger. The box to box midfielder being involved in all aspects of play to accrue points. Again, the two heatmaps below illustrate with the two contrasting midfield styles of Toni Kroos and Sergio Busquets.
In addition to core player statistics, it's also worth evaluating the players position at the club and any external factors which may influence his price in the near or distant future.
Is he a first team regular, and does he regularly play 90 minutes (managers substituting and rotating players can be detrimental to their performance scores and subsequent chances of winning dividends)
Is his position under threat? Is he cover for an injured player,
What is his injury history? Does he have any recurring injuries, and how much football has he played in the last 12 months (excessive amounts can lead to burn out or injuries)
What is his contract situation? Are there clubs interested if he is nearing the end of his contract, or has a transfer been arranged? What is the likelihood of him signing a new contract or extension
What is the situation at the club? Are they fighting relegation, European qualification and are they underperforming or overperforming?
What is the situation with the current manager at the club? Is it likely to change and does he appear to have a good relationship with the manager?
Performance Matrix Changes
A hot topic in the Football Index community. Should the Performance matrix scoring system be revised at the beginning of each season? There are many dimensions to this debate which will be discussed separately, but the crux of the matter for your portfolio, is how any changes would affect the value of players in your portfolio. To start with, the safest holds in my opinion are those with very strong all round games. Attacking players who can play deep, defensive players who can attack and those whose points scoring are not dependent on one aspect of the matrix.
Whilst Football Index will not confirm if the performance matrix will change or not, or how it will change, it's safe to assume that there are certain attributes which will always be rewarded highly. For example, goals scored, assists, chances created.
What is the current sentiment towards the player within the Football Index community and beyond. Football forums and fanbases can be a great source here to discuss players standing and status as well as their key attributes, qualities and prospects. A large percentage of players will have already been discussed to some extent either on the Football Index forum, Twitter or elsewhere, and a basic search should give you a good starting point.
Identifying an Exit Point
Key to buying a player is having an idea of what target you are trying to achieve, whether this is in the form of dividend returns, or capital appreciation. This is known as an exit point, and crucial for planning your trading on a player. As well as overtrading discussed in previous threads, many traders are also guilty of hanging on to players for too long in the false belief they will continue to grow. The balance here is very difficult, but having an idea of when you no longer feel the player represents value at their price, may be a good time to sell. If we hang on too long, we start to lose money, as the player falls and also miss opportunities elsewhere.
A useful thing to do here, would be to combine a quarterly or yearly plan with the your notes made when buying players. What are your expectations of the players price at each quarter, and where would you consider selling? Always remember to factor in dividend increases here, and general growth of the market.
Backup plan. Are there are any safety nets to buying? ie. if you buy for the Champions League and he is dropped, or the team is knocked out, will he be involved in the Euros or World Cup to provide a second chance to exit the player?
If you bought for the short term and he didn't perform as expected, is it better to hold slightly longer for a better exit point?
Mitigating Risk - Retiring Players
Who will replace the player if/ when they retire? Is it worth having a small holding in this player to offset the losses of the other?
All in vs Slowly Building a Position
Another factor which you will likely want to consider is whether you want to slowly build a position in a player, by topping up gradually over time, or go all in for your target shares immediately. This of course, is dependent on many factors including funds available at he time, but also factors outside of your control. For example, if the short term future of a player is uncertain, and there is a good chance there may be a short term dip, a prudent strategy may be to buy into the player with a small amount (say 10 - 20% of the total target holding), and then gradually buy more shares in the player as he drops, until he bottoms out, at which point the remaining shares can be purchased, bringing down your average buy price. Of course, timing here is crucial and it can be very difficult to predict, but recognising patterns and some basic research should set you up for recognising when opportunities may present themselves.
As well as general price fluctuations in line with the overall market, there are also some likely scenarios in which a player is likely to drop and will present opportunities to top up or buy. These can be referred to as 'out of favour' players and include
Being knocked out of a European competition
Being knocked out of an international
Official confirmation that a favourable transfer won't happen (assuming you see value in the player at his current club)
The days after a favourable transfer is completed. The media attention leading up to the transfer will likely cause a spike as traders chase those media dividends, but once it is confirmed and announced, the media exposure will likely reduce and the price drop?
Being omitted from the starting lineup. This can create panic selling and opportunities
Poor performance. A single poor performance can in some cases, cause a significant drop after the match
For the options available to traders on the process of buying players, including market buy and the new Matching Engine (first phase of Order Books) please see my subsequent post: The Process of Buying Players.
Screenshots courtesy of the SofaScore app.
Thoughts, suggestions and comments below please.