Outlook
Optimistic
State of the Market
A quiet week which is to be expected and if you feel like you are backsliding a bit in recent days you don’t neccessarily need to worry – I’ve lost just over 1% this week personally but it does not stress me out.
We can’t win all the time. In fact, I’d probably be more worried if there was never any pull back or correction. All that matters is the bigger picture and whether you are making progress in recent weeks and months.
If you have a solid portfolio full of good players and real prospects, then you have reasons to be confident that people will come back to them and don’t need to worry so much. Traders will come back to these players either automatically after the break, or the next time they win or score big.
The only ones who should be worried are those who persisted in holding the garbage that has been punished in recent months hoping for a rebound that was never coming. These being the weak/over hyped players whose ability can’t match the price, much of which was at the youth end.
If you are in a bad trade, a good trader takes their medicine. Too often people hang in because they can’t stand to take a loss. Maybe the player was always weak and relied on hype. Maybe they used to be good but aren’t anymore. Either way, you’ve got to get out of it unless there are credible reasons that they will recover.
Looking at the drops this week, there is a lot of overpriced rubbish on there that deserves the drop. But there are also plenty of good current and potential players being sold along with the bad. Why? Because many people don’t really know the difference. And some people might just need to free up some funds to pay for Christmas, who knows, doesn’t matter.
Buying and Selling in a Glum Week
Overall, this feels like a much better time to buy than it is to sell.
And yet, most people’s instinct is exactly the opposite. This is why it works.
Since good players are dropping along with the bad, good players who might have been out of value range before just got a little cheaper. So, carefully buy up the genuine talent whilst avoiding the overhyped players that are dropping.
Just because an overpriced player has dropped does not make them value. They were just very overpriced before. Ignore their holders/fans on social media who are furiously trying to convince people to buy them “at a discount” to soothe their own losses.
That only works when the player is any good and worth the money.
On Selling – this week particularly – it’s hard and difficult decisions may need to be made.
Where you have a player you think is a real mistake (poor quality and ovepriced or formerly good but now has some genuine obstacle), unless you really believe it will get better sometimes you just have to take that hit, even to Instant Sell if needed.
Where a player is solid but maybe just out of form or has a good chance of recovering (i.e they are performing ok but it just hasn’t come through in a good performance score for a few games – Scouting helps here) then I would try to avoid selling in a market where prices are dropping.
If you can move them on in the Sell Queue and you want out – that’s ok. But it may be difficult when few are buying, and those Instant Sells can be very expensive and is best avoided.
Possibly after the International Break when things look more optimistic that might be the time you look to move that sort of player on.
Why are things slow and when will it get better?
The International break is one reason things are slow, although much less so in the past. As longer term members will recall from the Early Season Strategy in August I said that there are lots of reasons to hold the European big hitters this season.
And it’s not just Euro 2020 itself. These players will be more resilient to any short term dips over an international break than most. And those who perform this week could see further rises – good performance scores in internationals are important because people will use these small numbers of games to judge their Euro 2020 buying on in 2020.
(They will actually probably over use them – you can’t tell very much just from a handful of scores which is why I pay much more attention to the stats behind them).
Other minor factors like trying to free up cash for IPOs, some people wanting to take some money back to pay the mortgage after over extending in the recent market surge, early worry about winter breaks. All of it is there and difficult to quantify.
It’s a collection of minor temporary factors basically and it should turn when domestic football comes back.
And, in midweek, the players who score well on internationals will be a bright spot.
Overall, I don’t worry too much about these things. I’ll stick to my own game, my Key Strategy plan, looking at the value players dropping and looking at buying them, cutting off any trades where the reason I bought no longer exists.
Basically, focus on my own game and not over worry about what other people are doing this week. I’m confident in my choices so I’ve earnt that luxury.
The Winter Breaks
The Winter Breaks are coming up. I didn’t include them as a big thing in the Winter Strategy itself because it’s not such a big deal to the overall strategy.
Winter breaks are more of a week to week tactical detail to me and not something to over react to. But there are a few things to keep in mind.
It gives a natural premium to EPL players over Christmas. This is not great for me because my least favourite market is the EPL although I don’t care that much (it’s popularity often makes the best players poor value compared to other leagues).
Serie A and La Liga have very short breaks of just a week and a half – I pretty much discount this as not that important.
The Bundesliga is hardest hit with nearly a full month out. Followed by Ligue 1 at 2.5 weeks which is substantial.
Option 1 is to do nothing special and that’s ok. It’s a temporary thing and as long as the players you are holding have quality and a good strategy fit, you should not get too many problems tempting traders back to your players when the break is coming to an end.
You will not have to wait for the full break to be over either most likely. It’s a bit like when a player is out injured for a month. You might get an initial dip but then people buy thinking “he’ll definitely rise when he is coming back!” and somehow the player ends up the same or even higher than before.
This injury buying is very common now and people are likely to apply the same logic.
Option 2, which is my preference, is just to make a few tactical tweaks.
For example, I’d be quite unlikely to be buying Bundesliga or Ligue 1 players come early December. I’d be more likely to buy them in late December, ideally timing it as any Bundesliga or Ligue 1 players drop for the Break. I’ll be buying when others want to sell which is where you want to be.
For my big hitting “Full season fit” players I’m extremely unlikely to sell them just for an international break, Bundesliga or not. The spreads are high, they are likely to be difficult to shift, people will want to come back to them quickly anyway. Feels like a waste of time and if I am confident in the player I can handle any short term drop.
If I’m losing a bit of faith in a player and am starting to question the hold in November, and I see the winter break coming in a few weeks, that’s another reason that might tip me over the edge into selling.
If that’s the case, the last third of November might be the time to do that as the international break ends, and just before people are really starting to worry about the Winter break.
So overall, it’s going to be a factor, and we should think about it in terms of the tactics of buying and selling around it as I’ve said.
But overall, it’s not a major thing that would cause wholesale changes in how I trade – my focus is executing my overall Key Strategy.