Football Index Trackers: What are they? How do they work?
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Football Index Trackers – What are they & Are they worth it?
A Tracker is a simple way to purchase a share in a large number of footballers on Football Index.
Tracker packages are available in the Top 25, Top 50 or Top 100 Footballers, meaning you would own a share in the Top 25, 50 or 100 priced players.
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These are predominantly aimed towards higher end traders, as they aren’t cheap.
Also, they don’t move lots in price, so traders won’t need to continually log into their portfolio to adjust on a daily/weekly basis.
They are a good option to have, but not something I particularly fancy
You only need to look back 12 months to see just how beneficial Trackers can be. I don’t have an official number on the tracker prices at that time, but I can see last year, Messi, Ronaldo & Neymar were all under £3.
In 12 months, they have tripled, or quadrupled in value.
The rest of the index has also adjusted and done the same.
Mo Salah was 1.70… Now £9.60.
Harry Kane £4, now £9.
I presume anyone that has held trackers for over a year will be at a minimum of 100% capital appreciation & that’s before the dividends come into play.
If you hold a Top 25 tracker, there is a Very High chance that you will be collecting daily Media dividends.
The highest priced players are so high because of their dividend potential. You have to pay a premium, but these are the players which have high buzz scores on a daily basis.
Ronaldo, Messi, Pogba, Salah (this season), Neymar & Harry Kane.
Obviously, there’s also the chance for Performance Buzz Dividends, but that is a little more difficult to win than Media Buzz.
Fortunately, newspapers always write about the same players!
Large Wallet with Little Time
Trackers would be a sound investment for a trader with very little time to dedicate to the index.
It’s an easy way to purchase the top players, as the index grows they will bring in price appreciation, as well as many dividend returns.
the index is nowhere near it’s limit in terms of growth, it’s only 2 years old
Potential Problems with Football Index Trackers
As social media plays quite a big part, in 2018 you need a Twitter account set up, following all the best possible sources, as well as other traders. Let’s face it, if you know what other traders are doing, or plan to do, you can be first in line to attack the trend.
If you can’t dedicate this time, it’s likely you will miss out on the highest of profits.
Not having the time
Here’s an example, you are watching Real Madrid vs Liverpool. Mo Salah breaks his leg. Traders who can devote time to watching the game would be able to sell him at an earlier point. This means they can exit at the highest price possible, meaning they can maximise profits/minimize losses.
If you haven’t got the time to be making these decisions at a crucial point, you could miss out. We all know how Ibrahimović fell from £6 so suddenly.
Overpriced players in Top 100
There are some players in the Top 100 which are vastly overpriced.
James Milner at £2.34, Loic Perrin at £2.12 are just two examples. These players are dead-wood, they have minimal chances of earning dividends, and their price certainly won’t increase.
There are lots of players in the Top 100 which haven’t return any dividends this year, so they aren’t all great purchases.
Now, over time, the players values will change, so it’s not always going to be James Milner in the top 100!
Return on Investment
If you buy a Tracker 100, this would cost you £316.69. For a single share.
It’s highly likely that you will win Media Buzz every day, which would equate to around £20 per year returns.
Performance Buzz at a guess, I would estimate £15 per year returns. Although this is still over 10% Return on Investment, it’s taken a whole season, and realistically you’ve only returned £35 (from my calculations).
There has been many opportunities this year to earn much more than this… Salah went from £1.90 to £10, with over £2 of dividend returns per share, Depay went from just over £1, to almost £3, with around £0.80 of dividends too.
It can definitely benefit you to purchase a bunch of players, compared to buying a single share in all of the players.
Obviously, you have to manage the risk factor, Mohamed Salah could break his leg and be out for a whole season. If you were ‘all-in’ on Salah, you would be in a sticky situation. However, you wouldn’t really be effected by this if you opted for trackers instead.
Price of Trackers
The last issue with trackers is their price. The price isn’t set by Football Index, it’s just the total price for a share in each of the Top 100. Nobody can help the price of Football Index trackers, as they are simply the combined prices of the top footballers.
I do feel that there are better places to invest your money, providing you have the time to research.
£316 for a single Tracker100 isn’t cheap, you’d need a good few hundred of these to make it worthwhile over the course of a year. Even then, you could simply pick and choose the players you’d like to own!
With 100 costing just over £31,000… it’s not going to be possible for all traders to acquire these!
I wish I was the first person to have found Football Index, I would have put everything I own on trackers and probably be a multi-millionaire by now! However, when you actually look into it, you could pick and choose the best players and see the largest rises that way.
If you’re a passive investor, with quite a lot of money, these will be ideal. They will more or less guarantee dividends, alongside owning a collection of premium players which should only rise as Football Index grows further.
You have to love hindsight!
Trackers are great if you have little time, believe in the growth of the platform, or simply want to purchase shares in all of the players (to more or less guarantee dividends).
However, you could see more returns for your money by ploughing the money into certain players you like.
If you own a single Tracker 100, costing £316 and Paul Pogba wins Media buzz, you would get a £0.05 return.
If you owned £316 worth of Paul Pogba, 46 shares, you would receive £2.25 in dividends. On the flip side, when Paul Pogba doesn’t win, your 46 shares win nothing, but your Single Tracker will keep rolling, collecting dividends.
Let us know below, are you buying trackers? Or do you prefer to pick and choose the players in your portfolio?