Week 23 – the hangover

This might be a slightly shorter post than normal as I’m currently nursing an almighty hangover thanks to a Jägerbomb fueled trader meet last night (thank you IndexGain!). I was feeling well rested and ready for a night out, having let the IPO madness pass me by last week, preferring to watch from the sidelines, rather than put myself in a sleep deprived state in the hope of a quick flip.

The Index is nursing a hangover of its own after an absolutely insane 6 weeks of announcements, dividend increases, bonuses and IPOs. The international break gives us a short reprieve to gather our thoughts and plan our strategy for the weeks to come.

What have we learnt since the dividend increase was announced? After some initial outcry that the increase in PB ‘killed the youth market’, a more rational train of thought has now developed. Logically, any PB increase should benefit young players too as their value should be related to their future dividend potential. On the flipside, the opportunity cost of holding players with potential, rather than players who can earn dividends in the here and now forces us to be more ruthless with our choices.

The Potentials fund has reflected this well over the last week. Overall, the fund is up by £149 (3.7%) over the week with solid gains for Haaland, Kulusevski, Rodrygo, Berge, Stengs and Bergwijn. All of these players are showing good form, PB potential and in most cases some possible transfer links too.

The rest are largely stagnant and most still showing an overall loss against their purchase price. Situations like this really force you to look at your original reasoning behind the purchase to see if it still stacks up. Do I hold some of these in the hope they’ll pick up or do I cut my losses at this point?

One I did cut loose was Osimhen, at a shocking loss of £53.59 (around 20% down). His price nosedived when the dividend changes were announced and to be fair, I was stupid to hold him for so long. He’s only just signed for Lille so there’s not likely to be any transfer spec, he’s not got the Euros to look forward to and he’s rocking a PB average of only 60. Add to that, Lille’s poor performance in the Champions League and I can only assume that I had a complete brain fart to let him stink up my portfolio for so long.

Nothing too exciting to report in the other fund. The Premiums continue to hold steady, with Sterling the big success story of the week, making more in MB than he would have made in PB if he’d have actually been on the pitch. Altogether, that fund pulled a negligible £12 into the bank last week – really poor given the amount of capital tied up in these players.

I do think that the top end of the market will get a big boost at some point as there’s been very little movement since the dividend increases were announced. With Neymar about to return to the pitch and the January transfer window just around the corner, I don’t think it will be too long until we see more players pushing up towards £8 or even £9.

The Performance fund had a fairly flat week too, managing just £29 in profit. The internationals have had the biggest impact there, with those expected to perform well steadily rising – Depay, Golovin, Coman and Wijnaldum. Most of the rest held steady, with the exception of Milik, who dropped out of the Poland squad due to injury and Gundogan who saw a sharp drop, perhaps because traders felt he had too much competition for PB in the Germany midfield.

I’m not sure what will happen with performance players in the short term as I don’t think the market has quite found the right level for a nailed on PB player yet. We’ve also got the winter break coming up and no more Euro matches until March so I expect we’ll see some traders shuffling their portfolios around.

I’ve got a bit of cash available to put into new players or top ups but I really don’t have the brain capacity to do that today – but suggestions are always welcome. The full breakdown of my funds can be found on the separate fund pages. Happy trading!

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