FIT Key Strategy - Final Third of the Season

Members of this site will never be left hanging when thinking about strategy!

I’ll always provide my detailed thoughts on what is coming up and how I think it is best to position ourselves in the months ahead. 

The site is filled with pointers every week but every 3 months or so I expect to do a big strategy article like this at key moments. 

From late February right up until the start of the next season in August is the most difficult but also the most rewarding time to trade on FI. In this time, we will:

  • exit the season in an organised way and lock in some fat profits (if all went to plan, and this looks like another great year to me!),
  • Set ourselves up for the Summer to ensure our gains keep coming, and then;
  • We will position ourselves to start the season holding all of the best cards. 

The next 3-4 weeks are going to be critical to ending the season well and setting up for the Summer. It’s all about having the portfolio other people will want in 1-2 months time at every stage. 

There is a lot of confusion around right now and I can sense that many people are not sure where to put their money.

Some people were around last season and have that experience to draw on. Many do not. But each season is different and has different factors in play. Last year there was a World Cup to tide things over in the off-season. Not this time. We also have the Share Split coming up which further complicates matters. 

So there is no set formula for success season after season. Rather, we have to look at what is coming up fresh every few months and then work out what to do. 

I have a very clear idea of what I am going to do. And I am going to share it in detail with members and nobody else. I am targeting large, fairly rapid capital appreciation over months rather than years. So the strategy may not work for everyone, some people go for 2-3 year long term holds for example. But no matter the strategy there will be principles in here that everyone can apply. 

It is also based on the current information we have right now. Likely, we can set our general course for the next few months but we will need to adjust certain things along the way to ensure we land it safely. Members will always be the first to know when I do!

So, let’s get to it. 

The Environment

First we have to think about what is coming up in the coming 2-3 months. 

The two major factors are going to be the Share Split in March and the end of the season in May. But the hype for the Share Split is well under way, and the fear of the end of the season is already starting to creep in. 

We’ve still got the Round of 16 in the Europa and the Quarter Finals onwards. The business end of European competition is going to be a factor but not as significant as the two above.

As well as all this, we have the Summer to think about and need to position for that, too.

The Share Split

This has been known about for a long time, even if we did not know the date. It has already massively pushed up prices at the premium end. I have a background reading article on the Share Split here, so I will not run through all that again here.

There is some nonsense being peddled about the share split in all honesty. The fact is, it has no actual impact on real value (unless the dividends change as well, more on that below).

It is mainly a psychological marketing trick which will, over time, likely have a beneficial effect on the market. And it will particularly help the more expensive players as it makes them feel more affordable to small buyers. 

But it will not help them that much. And any small benefit has already been priced into them. If I had large holdings of premium players (I don’t) my biggest concern would be that others may be using these expectations to flip these players in advance of or after the share split. It won’t definitely happen, but it’s not a risk I would want to run personally. 

Lots of people have some quite crazy expectations of the share split and the hype may push people into silly things in the run up or immediately afterwards which is going to be hard to predict.

But the fact is, when that dust settles, the fundamentals of what drives prices in the market (on the trendometer) are not going to significantly change because of the Share Split.

So here is our first strategy cornerstone: 

Cornerstone 1: Maintain a focus on the fundamental market trends rather than sweating too hard on what the market will do on the temporary share split announcement day.

If we need to react to a crazy curve ball when the SS is announced, we can do it then.

Secondly, the most important thing that will be announced is NOT the Share Split but rather the now anticipated accompanying announcement about any dividend increase, or change to dividends.

Unless a rabbit is pulled from the hat, I think we are expecting a significant but not earth shattering increase, perhaps in the region of 5-15%. FI could also take the opportunity to adjust the balance between media/performance and it is something we will not know until the time. 

It is likely that players who win lots of dividends will become more valuable. We don’t know exactly what changes will be made, but I think it is fair to assume that any changes will benefit or at least not disadvantage goal scorers. Football is about goals and FI have always tried to maintain that focus.

So, the second strategy cornerstone is this: 

Cornerstone 2: Continue to ground your selections in players with strong dividend returning credentials. They must have strong prospects of returning dividends either now, over the Summer, or at least early next season. Ideally, all three. 

For those of us following a strategy similar to mine, this is just fine because attacking, goal scoring dividend returning players are the players we go for anyway. So no need to adjust much here.

Smoothly Transitioning from Now to Summer

The right players to hold depend hugely on circumstances and time of year. 

Performance Ratings on this site are crucial to know. But they are not the full picture. A 4 out of 5 stars player is not a slam dunk profit just for being performance suitable. Holding solid performance players is always going to be an advantage. But whether they are profitable holds for the next few months in particular depends on the trends, the buy price and the coming events. 

Back in November/December, accumulating strong performance players, particularly with European competition involvement was perfect. You had more matches to come, nobody was worried about the end of season yet, and many of them would rise after the winter break as expected. Perfect. 

But buying players purely for performance purposes now is not the optimal play. It is too close to the end of the season. 

What we need now is a reason for people to hold in the run up to the Summer, not players who will be cut as the end of season fear increases. So cornerstone 3 is: 

Cornerstone 3: Over the coming month, start offloading “pure” performance players (i.e strong performance players with no transfer speculation/hype) ideally at favourable prices without instant selling. Ideally, use the day of big games (quarter final of European competition), or the days they win to do it at a premium). 

If the spread is small and you fear the player may drop suddenly, then an Instant Sell is not the end of the world. But I like to make this a smooth exit rather than a dump. Those Instant Sells really do eat away at your profits if you add it up. 

Now, we need targets in mind to buy when we free up our cash. No players are risk free, but there are definitely picks that are both safer and more likely to return big profits than others. I will now describe the traits I will be looking for in my holds for the next few months: 

Cornerstone 4: Buy players that fit the following criteria and should maintain their value as the Summer approaches:

Solid: They will be quality performance players, at least 3 out of 5 stars and ideally 4 out of 5 stars for potential. Best case, they will still be challenging for dividend wins this season, but if not, we at least want a strong chance of them playing regularly in the first team at a favourable club next season.

For a forward, I might slacken my requirements to a 2 out of 5 stars provided they are a very strong goal scorer and fit well with all other traits. 

Speculation: They will have a credible chance of a move to a performance suitable club in the Summer. Traders must believe they will stay relevant going into the Summer and get bought based on the hype of a big move or summer media wins. If they are expected to stay at their current club, they are no good for us. 

Price: The price must have some room to grow (you can use the touchstone prices in this weeks Defenders article for a reference point). In general, there is no point plowing into a £6+ player at this point, you may get a gain but it will not be big enough. Unless you believe it will be a HUGE transfer incoming to the EPL, like a Bale, Isco or Dybala I would steer clear of this.

In general, target the £5 and below range and adjust what you are willing to pay depending on performance rating and how far you think they hit the positive trends on the trendometer.

Trends: They broadly fit the stable positive trends such as age and forward/midfield players. The 17-21 age group is fine but bear in mind that often they will struggle for pitch time. For that reason, I often favour 21-24 who are more developed. And the 24-27 has some serious talent, often undervalued, where players are going to be hitting their prime. 

European involvement: This is becoming less of a priority but if a player broadly fits all the above criteria and is still in Europe, it’s a nice bonus. 

The above will represent the absolute bulk of my portfolio for the coming months. But it is worth a quick note on “off trend” players. If the price is extremely low for a quality player that could come good next season (i.e under £2 for a mid/fwd or under £1.25 for a defender) I may hoover up some of those early. In general, I will worry about this sort of player later on though.

Final Note

Picture what happens the day after the Share Split announcement. It could be as expected, things broadly stay the same in terms of dividends, with some getting a slight bump. Or, dividends could be adjusted slightly and we may need to do some tinkering.

Your portfolio will look very different. It will be all very exciting and a big deal. 

And then a day or two later, the focus will be back in reality. People will be getting very stressed about an “end of season sell off” particularly in performance players. The CL and Europa League draw will have taken place a few days previously, and people will be looking forward to that. 

We must acknowledge this: There probably will be some kind of end of season sell off. By moving now towards the players that people will want to keep for the Summer, we will protect ourselves from the worst of that. 

At the same time, we give ourselves the best chance of hitting the right transfer links in the Summer. We can monitor these rumours and adjust our portfolio if someone who looked like getting a transfer now doesn’t. We can add new players who pick up a credible link and now hits our criteria. 

And if the absolute worst comes to the worst and we are on holiday in the jungles of Vietnam when our star man drops in price, we have solid dividend returning players who should be good to bounce back as the new season approaches if we want to hold. 

It’s about giving ourselves the maximum possible ways to win whilst also building in insurance policies. This is one of the main benefits of holding players with true underlying value rather than garbage hype picks. 

So, I’ve set my course. Some people may be flying with FIT airlines. Others may be doing something completely different and my plan is by no means the only way to profit. But I’ll be keeping an eye on the FI developments in the next few months and whenever my plan is adjusted, members will know about it.

Hopefully, we land this phase of the season safely. It’s probably the most difficult and stressful time of year as we hit the business end of the season. But also the most rewarding to get right. 

And then, we do it all again in the Summer where I will be crawling over every friendly match and transfer rumour to get us set up to start next season holding all the best cards.

It never ends!

I hope you find this helpful and if you have any questions I’m very happy to field them via Twitter or the Contact FIT button.

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