From A Passionate Trader To You

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The record-breaking post in the Football INDEX Forum written by @spfootballindex. To see the original in the Forum please click here.


Been seeing alot of nonsense on twitter and on the forum recently so just thought I’d set out my thoughts. I’m not even one of the more experienced traders like some of the other guys who have already spoken about some of these things, but it is extremely frustrating to see some comments so felt I had to chime in. My main question to anyone is this: how much do you believe in this product? You really need to nail down how you feel about this product as quickly as possible. Trading is a state of mind above anything else and if you genuinely believe in the product and back it 100% you will make far more rational and sensible decisions rather than being led by your emotions. For me, this will be the fundamental difference between you making a little profit or lots of profit, as I will get into.

RECENT PRICE MOVEMENTS

So many people asking about this. The answer is simple: it’s a natural flow of money that happens at the end of every season. That’s it. If you haven’t been on the Index long enough to know that then now you know. Use it to your benefit from now. In terms of my personal position, I hold most of the big players and currently hold them at a loss from where they were a few weeks ago. I believe they will rise again towards the end of summer and be good value for the following 9 months thereafter. That is not withstanding the platform growth that I anticipate over the next 12 months which I believe makes them exceptional value at current prices. I also won’t be too involved in transfer trading. Now, this is MY choice based on MY strategy etc. and I will own it and accept the positives or negatives that come with it. If the result is ultimately more negative than positive I will have made a mistake and learnt something that will stand me in good stead in the future. But in the interim period I’m not going to stress every day by seeing drops – that wouldn’t make any sense in relation to my strategy and belief in the product, because looking at it as of today I would have made a terrible decision! YOU need to settle on where YOU see this product, form strategies applicable to YOUR bank and YOUR time and execute them. It may not be to hold like me, it may be right for you to sell. But do not listen to or follow anyone on this forum or on social media when making decisions. Everyone is out to influence and persuade and ultimately make money. Think and learn for yourself. You need to spend enough time on the index so that you never again have to ask the question ‘why is this happening’?

SUMMER TRANSFERS

As many have said already, the summer transfer window provides huge opportunities to profit but also huge potential for large losses. It’s as simple as that. If you have experience you will know the game and will probably be able to make some decent cash. If you’re newer do not overtrade and use it as a learning experience. The rule of the game is ‘buy the rumour, sell the fact’. That means that before the actual transfer happens, expect prices to rise above the fair value of what that player would be worth after the transfer, and then expect a drop after the transfer happens down to around his fair value. There may be exceptions but that’s the general rule. My personal advice would be that if you don’t have the time or inclination to be on the internet regularly until 11 August then be very selective in the players you trade as one piece of breaking news can see huge drops and wipe out hard earned profit. If you are getting involved, know which sources are reliable and which aren’t so you are able to gauge the timing of your exit. Free tip: most of the outlets used for media buzz are not reliable at all. But for making a bit of quick money, all that matters is that that player is in the top 3 for treble media buzz, regardless of the substance of the rumour. If one or two players can get in the top 3 regularly their price will rocket so be prepared to be able to get in and out efficiently to maximise your profit.

I’VE MISSED THE BOAT

Anyone saying this hasn’t done much research into the platform, how much risk some big traders have taken or hasn’t thought hard about the future of the platform. About a year ago I took a huge risk and started to put significant amounts of money into the index, partly funded by savings and partly debt. The reason I did that was because I had studied the Index for a long time, felt it was a reliable trading platform and saw the massive scale that it could achieve. I had also seen traders with 6 figure portfolios, one even was worth around around £200k which gave me inspiration. Even at that time I remember some traders saying ‘I missed the boat’ or ‘I wish I had put more money in’. Yet as we sit here now looking at the next 12 months I would do EXACTLY the same again and in many ways I have by not withdrawing significant funds from the index and re-investing nearly all of my profit and dividends.

Why do I think this? Well, the idea of TV, talksport, tube, bus, newspaper ads just over a year ago would have been insane to most older traders. The idea of having over 100,000 users would have been too. Some of the prices that we see now were unfathomable. The idea of opta stats and performance buzz were just pipe dreams. Trader meets with BBC show hosts and ex-pros. Seeing verified twitter traders, professional sportsman and journalists talk about the platform. We would never have dreamed of having the Index in Sweden, Canada and Ireland. I could go on and on. But many traders saw something in this product right from the start before all of the above and took significant risks which have paid off. At least when I took a large risk I had some track record to go off, and so far it has paid off. So to anyone now, as we sit here today, having had the benefit of knowing all of that history, recent growth and expansion of the Index, and to not think that what we are about to experience in the next 12-18 months will be completely unprecedented and not to see it worth significant risk, I find extremely odd. Now again, don’t agree with me for the sake of it, think it through and come to your own view, but if you disagree just don’t be one of those people in 12 months time again saying ‘I missed the boat’ or ‘I wish I’d invested more’. Make your decision and own it.

Lastly, Football Index’s early aim was to reach a market cap of £100m and I’d estimate we’re currently anywhere between £7.5m to £10m. Personally I think it’s far easier to grow a platform with a known brand and user base from £10m to £100m than it is to grow a completely new concept from zero to £10m. And if you understand how this market works and how this growth would be achieved, recent price drops are almost irrelevant and current prices will be proven to be heinously cheap even over the medium term. Again, it all comes back to how you view this product and its future. In general, the risk you feel comfortable with both in short term trading and longer term investment will correlate to your comfort in how you feel about the product. And obviously, the higher the risk the higher the reward.

GIVING BACK

Football Index has provided us all with this great opportunity to make money and have fun. Despite some mishaps along the way they are great guys who have always shown the right intentions. They’re working hard to grow the platform which will provide more opportunities to profit for us all. But have you asked yourself what you can do to help the growth of the platform? Have you introduced all your friends to it and taken the time to explain it? What light do you show the platform off in by the way you tweet or post on the forum? It’s no coincidence that most of the successful traders write well thought out, reasoned posts which can benefit everyone and show a level of seriousness to the platform. Constantly barking ‘why is this happening’ ‘X player is massively undervalued’ or posting Daily Express articles pushing your players is only going to show you in a negative light and therefore the platform too. Someone like Football Index Guide has slogged away for hours and hours producing podcasts and youtube content. I haven’t done nearly as much but even now some days i’ll stick football index into the twitter search to see what new users are interested in the platform and try and engage with them. So what can you do? Can you, for example, find Swedish football twitter accounts and get them interested in the index? It’s no different to the twitter advertising that Football Index are doing over there. At the end of the day, if you want to profit more, faster, it will also depend on the work you do and we do as a community to promote the Index in a fair and balanced way. Don’t expect anything without putting anything in, that applies to both capital and time.

YOU CAN ONLY MAKE MONEY WITH LOTS OF MONEY

I just wanted to put some trading/price movement examples which highlight how ignorant this comment is that I hear often.

  • I owned Harry Winks at around 60p once, but sold him for around the same price in frustration. He reached around £1.60 at the end of last year.
  • I owned Matias De Ligt at 70p just a few months ago, sold him for around the same price in frustration. He’s now worth double that.
  • I owned Milinkovic-Savic at around £1.40. I sold some at £2.10 before he went to £3m
  • I owned Salah at £2.40 and sold out at £4.20 when I thought he had peaked only to then have to buy back in at around £7
  • I bought all of the big boys only a few months ago when they were around 30% off their current prices and many traders were saying they were too expensive
  • Trent AA has gone from £1.20 to £2 in 1 month
  • Sessegnon has gone from £1.74 to £3 in 3 months
  • Vinicius Junior has gone from £1.50 to £2.50 in 3 months
  • Morata has gone from £3.75 to £.2.35 in one season
  • Lukaku has gone from £5.50 to £4.25 in one season
  • Parejo has gone from £3 to £2 in one month
  • And of course, Neymar £1 to £11 in 1 year.

The development of the platform’s functionality, the growth of the user base and market cap growth will continually provide short, medium and long term opportunities like these in my view. Yes, if you have more capital and are a good trader you can make very large sums. But even if you don’t have as much capital, if you are smart and willing to take risks you can build up your bank quickly to then allow you to make larger profits. Too many smaller traders think in £ terms when they should be thinking in percentage terms. As was said in a recent podcast, many people are happy to throw away 100% of their stake on accas every week, but a 10% drop in their Index portfolio over a month makes them anxious, which is strange. If you can make even just 10% ROI on your investment in one year whilst having fun then you’re doing better than most other available investments out there.

Rant over. Best of luck to everyone.

https://www.footballindex.co.uk/stockmarket/team

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