Today is the big day. It feels like a long time since November when it was first announced and I can’t wait to finally open up the portfolio and see the changes in action.
It will be strange to see everything cut in three. And I am sure for even the most rational of us, it does have a psychological effect. If not initially, then certainly over the weeks and months, I think this will be a positive thing that encourages more trading at all price points.
Those smaller holders who want to hold the big names can now do so more easily. And that £2-6 bracket is now going to “look” insanely cheap. And that’s before you have even considered the average 28% increase in dividends.
That’s just really positive because it sets up a good 2019 that people have confidence in. Dividends have caught up some with the increased prices and the stronger that link is the more healthy and sustainable the market will be.
So, how about handling today?
Personally, with these events, I think if you knew you were going to put money in, and you had it, you might as well have just got it in there well before the event. Holding back at a time like this is only likely to lead to paying more.
The only reason I can think of not to just get your money in the mixer as early as you can is if you fear technical problems with the split that could dent confidence. Could happen and it’s not in our control, so that was just a personal call.
We saw in the last announcement how people (often the big fish traders who still have a big % of the total cash) are not always going to charge straight in on market re-opening like the old deposit bonus days.
It’s hard to call the initial reaction but given how easy it is to predict the risers, it makes sense to me to just already be there waiting for any late comers or on the day pushes than it is being one of them.
It’s not rocket science to work out who the risers will be in the event everything goes smoothly after all. It’s anyone who currently has positive sentiment and has probably been rising recently (factoring in that the International break is now over).
At a time like this, it tends not to matter much whether they are actually any good for performance, or whether their transfer links are ropy as hell. If people feel good about them and think they have been rising, they will probably sustain that after the announcement as people look for an easy win.
That may be short lived as once the hype settles over the course of the week, people get much more measured and will start thinking about the real trends in play.
The next big thing is going to be hype for the announcement of the media/bonus on the 15th April. And no doubt there are many who want to experiment with the new In Play Dividends too. Plus, the first treble Champions/Europa League nights are not far away.
Vinicius Junior and Ousmané Dembele
Until the unfortunate injury this has been a dream season for Vinicius and he is playing senior football far quicker than could have realistically been hoped for. Dembelé too has seen good pitch time and pretty much displaced Coutinho for the big games.
More importantly for FI purposes, both are showing good performance potential too even though it has not quite come through on the FI scoring system yet.
Both were tanking in early March. Vinicius dropped from £11 to under £9.50 (old money!) and Dembelé towards £9. Many were starting to question if the young player bubble was finally bursting.
Personally, I do not think it is yet. Youngsters are always going to attract something of a premium, although there is no doubt that this season it has been far too high and will correct at some point.
This slow bleed out in early/mid March though is the kind of event that can shake people’s faith in a trend and others like Sancho were dropping too. Fortunately for holders, Southgate’s faith in youth in the International Break breathed new confidence into this end of the market.
What I think really happened here is that other competing trends are working against the youth trend, rather than it dying per se.
Unless your youngster comes with reasons to win media in the Summer, you are currently looking at a very long time until August where they may or may not start challenging for dividends again. Not everyone is up for tying large amounts of money up that long with no hope of reward.
But, in the Share Split, there are clearly some who now think these players look cheap after the dip and I think the rises again for Sancho and Hudson-Odoi has given people confidence in youth again in general.
As above though, in the coming weeks, I expect patience will be tested in all players that don’t come with strong reasons to hold them over the Summer, young and old alike.
Joshua Kimmich and Thiago Alcantara
To illustrate this trend of dropping performance players, we have two top drawer players who are seeing significant price falls this week.
They have strong performance credentials so their only real crime that I can see is not having any credible Summer transfer speculation. And it’s a double hit because they also lack Champions League involvement.
So, it’s another thing that highlights the importance of not just picking good players but picking good players who are on trend.
This is hard to do, and takes a lot of effort. Who is good changes quickly. As can the trends. And generally, if you are only noticing the shifts in the trends on the risers/fallers board, it’s too late.
To make the best money you’ve got to see these shifts coming weeks and months in advance.
The other type of faller that we will have to get used to is the shut down transfer rumour.
Asensio had some EPL links but Zidane has squashed those pretty damn firmly. And right now, Zidane gets what he wants.
This is actually good news for Asensio in the long term, so patient holders can be happy. But, he is going to struggle short term as people adjust towards the Summer.
This will happen more and more in future and whilst transfer speculation is fun and games and a necessary part of our trading, it’s not easy.
It takes a lot of time to keep on top of the rumours. And quite some skill and experience to sort the credible from the clickbait.
Pogba and Mbappé
These rumours this morning could barely have come at a better time for those holding! (I don’t!).
Just yesterday, transfers for both looked dead in the water with both strongly expected to stay.
Do I believe these latest stories that they want moves? No, honestly. There isn’t anything real to go on just yet. The facts and public statements still point in the other direction.
But for FI purposes on the day of the share split, that almost doesn’t matter. Even a sliver of hope for Summer media transfer stories from these two is going to be a nice boost for them.
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