The Challenge

New Traders often ask me the same questions: can I still make a profit starting fresh without bonuses? Are all the good players taken and too expensive? Can I do this if I don’t have a lot of time every day? 

I think the answer is absolutely yes. But rather than talk about it, I decided it would be more helpful to show how it can be done.

Starting from scratch with a £1,000 balance on day one of the new season, I am tracking my progress showing not just each trade but my thinking behind them.

The rules:

1) no direct use of bonus cash,

2) start with a blank portfolio,

3) long term and time efficient style, with no constant phone checking or watching every game.

Notes for New Readers

I’ll be trying to show not just the trades but my thought process and reasons behind decisions I make. The specific players I pick are less important.

You can check out the original post where I introduce my overall strategy and explain the opening selections.

As I obviously have an existing portfolio, I will not make these exact trades but they will be tracked realistically.

I will also own every player on this list for real so the selections will get my full attention. Generally, I select players I have talked about positively on the site.

I always say though, don’t blindly follow any picks you see from others including mine. Do your own research and if you see what I see, great, but you have to know why you have bought the player and be happy with it.

*Since the Challenge started the Index have dropped 2 further bonuses. I haven’t directly used them here, but they do affect the market and there’s not much I can do about that!

The 1K Challenge Portfolio

• Portfolio Value: £1,526.10
• In the bank: £47.7
• Value Increase from £1k: 57.3%
• Value Change from Week 15: +6.36%

Portfolio Performance

It’s been a few weeks since the last update. I’ve had a busy month with Christmas and all, but I have been ticking the Challenge along in the background.

In early December we just passed 50% returns which was a good milestone. It’s been a rough December for low priced performance based portfolios like this one, so I am pretty happy to gain a modest 6.36%. That’s a 57.3% total increase on our initial £1k.

We have had significant falls for players like Traore, Kamano, Plea, Ruiz and Thauvin which have dragged us down. On the other hand our Week 12 and 15 selections especially Mendez, Suarez and Aouar have picked up the slack and made some great gains.

So how did I deal with this tough month? Those who follow my Daily blog already know the answer. I didn’t do very much at all. I knew there would be some kind of winter break dip. But I did not think it would be as severe as it was.

Two main factors contributed to that:

1) Share split – it was a delayed reaction but there was a wave of “I must buy the top 5 players!” that swept FI for about a week.

2) Mourinho sacking – This was just another reason people wanted to free up money to chase already expensive assets.

Both of these things meant that people wanted to free up large amounts of cash quickly, and who takes the bullet? Obviously, it’s the performance players who are not going to be playing for 2-3 weeks.

Now, if I had made a conscious decision to dodge the winter break early, all to the good. But I didn’t. An Instant Sell fire sale comes with it’s own problems, and hindsight is a wonderful thing but it is not always the case that break = major dip. We have had breaks that have seen big increases, each one must be judged on it’s own merits.

Having not sold early, there was no way I was going to try to catch up late. We aren’t going to win by making the trades we wished we made yesterday. I have good players and I am confident in them so I am not going to sell them after a dip to chase players that have already risen rapidly, especially because I didn’t want most of them.

This thinking leads you to selling good players at a low to buy sometimes questionable players at their high. It’s the opposite of good trading sense. If we know our players are good, we know there will be reasons others will want to come back to them, probably in January.

In my real portfolio, I try to keep around 10% at least in liquid cash to jump on things when I want to without having to panic sell (such as some of the Manchester United players which I made a good profit on). However, with this limited £1k budget I am putting all my money out on the pitch.

Decisions Sells and Holds

I am finally sick of Leo Dubois and he has been offloaded. I will keep an eye on him because when back regularly playing for Lyon, and I am sure he will be, he should do well and he could rise fairly rapidly. People are going to want to pick up a good Lyon left back at around £1. But having held the whole season, his injury stops and starts were starting to irritate me so he is gone. I might go back if he starts seeing pitch time.

Exequiel Palacios was out of the door too once the transfer looked like wrapping up. This is a common move for me because once the excitement dials down, what you are left with is a player who isn’t doing much until August. However, he is almost nailed on to rise again in a few months so he remains on the watch list. There are some headaches for players like Traoré who are having some discipline/personal issues. But in general, I am content to hold and see how January plays out with the winter breaks coming to an end.

Buys

Just the one this time. Timo Werner has been featured positively twice on the site in recent weeks and I turned to him for the Challenge too. As regular readers will know, I am a convert having been a critic throughout most of 2018. His recent performances have dramatically improved and his tendency to score more than once in a game is particularly attractive. The transfer speculation is icing on the cake. Even if it does not happen in January, his contract is up in 2020 and a big move looks inevitable.

Next Week

January is a tricky time. We have a few players vulnerable to transfer rumours like Denis Suarez, Dennis Man, Thorgan Hazard and Timo Werner. Depending on destinations, we may want a quick sale. Barring any curve balls, I am expecting January to be a better month for this portfolio as winter breaks come to an end.

FIT