The market moves are fairly routine and will likely see a lull until things hype up for the weekends fixtures.
One thing I see a lot of on match days that is to be avoided is on the day buying.
This is mainly a tip for new traders but if you do want a player for the weekend, have a look now and buy early rather than waiting for the match day when the price will likely push up a bit.
After yesterday’s mammoth discussion post on young players, I am going to change gear and get straight into some players today!
Risers
Harry Kane
This rise shows the herd mentality at work. Kane is recovering from injury, and yet is now significantly more valuable in the markets eyes than before his injury? What’s that about?
He’s rising because he is rising. Momentum is very important in most markets, and on the FI market particularly so.
However. That isn’t Kane’s fault. He’s a solid dividend returner and the oddest thing about Kane is this: traders spend a ton of time, effort and money trying to find “the next big England thing”. Well, Kane is the big England thing. And yet he is apparently significantly less valuable than an aspiring player like Sancho.
It makes no sense at all and the market will correct it in time. Kane is 25 and about to hit his peak years as the England captain and I think by now, either finding success at Spurs sometime soon or else moving on to a top club.
If you use comparative pricing to assess value he is hugely undervalued compared to other premium priced players.
(As a side note – I do not but great weight in this method but many do – I anchor value in dividends and use comparisons lightly mainly to assess what others are willing to pay which is not the same thing as true value).
Malcom
It’s been a tough start to life for Malcom who came to Barcelona with high expectations after great performances for Bordeaux.
Filling in for Messi vs Real Madrid isn’t easy as he did last night in the Copa del Rey but he did it well, scoring their only goal and having a good game all round.
He did only have one effort but at least he put it away. I’d like to see more goal threat but it was a tough game and actually per 90 minutes it’s not too bad.
Is this the turning point? Possibly. It’s still going to be tough to get into the team regularly.
But a performance like this will give him confidence, and earn the trust of the manager to put him in more often. Failing that, it puts him in the shop window for the Summer if things do not work out at Barcelona.
Fallers
Joao Felix
A big drop for Felix although not unexpected given his meteoric rise.
It’s always worth zooming out on the graph and remembering that 7 days ago he was £4, and he is still £4.95 now.
This is probably cold comfort to anyone who bought in the last couple of days, though.
It’s a reason why no matter how much I want the player I almost never, ever chase a sharp rise unless the indicators are so strong that I think it would remain value even if a tough drop happened. So often, the player in my risers one day is in the fallers the next.
Basically, 95% of the time, it’s a bad idea and although you may get lucky sometimes, it is almost certain that if chasing the rise is a normal part of your game it will cost you more than it makes you over the season.
So, the player. Nothing has really changed. We’ve got a very hot prospect who is performance suitable and very likely to get a big transfer in the Summer. There is a reason almost every big club wants him.
But, like any young prospect of course his price is overheating in dividend terms. Comparatively speaking you can say that there are other players with worse or similar prospects at far higher prices.
I don’t think there are too many bad choices here. You can sell and take your profit or you can hold as excitement will almost certainly build towards the Summer. He also has a Europa league match up next week and with the market the way it is, the reaction if he scores could be crazy.
The only major risk I see is the young player bubble popping as a whole. Personally, I will stick. There is some insurance against said risk because Felix has a lot of potential and at least the price isn’t up there in the £7-8+ range yet.
Hot Gossip
Eden Hazard (and the potential transfer merry go round)
The Real Madrid rumours are starting already. This is a tricky trade because many will expect his media potential to dip once out of the EPL. It’s probably true but I think a player of Hazard’s quality might be able to punch through this. It will be a factor though.
On the other hand, his performance potential will likely improve at Real to compensate.
Also, the move could have several knock on effects. Rumours of Isco or Asensio being part of the deal are doing the rounds, both of which would be big players in the EPL.
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