You may have seen a Football Index advert recently and wondered what on earth it is all about. Or you may be a new Football Index trader and are a bit confused about how it works. This beginner’s guide to Football Index will hopefully make it easier for you to get started so you can be on your way to making profits faster.
What is Football Index?
So what is Football Index? Essentially it’s a betting market where you can buy and sell shares in real-world footballers. It’s often described as a mix between Fantasy Football and traditional betting but it has shades of stock market trading as well. It’s a concept that has only been around for a short amount of time (founded October 2015) and has seen massive growth since it started. The potential for further growth is huge bearing in mind how relatively new the product is. You have certainly not missed the boat if you are yet to sign up!
Take a look at our Football Index Welcome Offer guide where you can claim up to £500 cashback on any losses made over your first 7 days of trading!
How does it work?
Players that are available for purchase are split into the Top 200 and Squad lists. The top 200 contains the 200 most expensive players on the index.
The Squad list has the rest of the players available to buy on the Index.
Any of the players you see in these lists are available for purchase. Prices are based on the number of shares in circulation. So the most popular player on the index with the most shares purchased by users will be the most expensive player. Currently, that is Neymar with a share price of £8.22. Why his price is what it is and the reasons that drive people to buy players will be covered later.
Football Index pay out dividends based on real-world events. It is this potential to win dividends that drives a player’s price. There are other factors but in its truest sense value should be driven by dividend potential (more to follow).
How to Buy Shares
The buy price is the blue box highlighted in the image.
Click to buy up to 300 shares in one transaction. You can buy an unlimited amount, just only 300 at one time. Once purchased, the shares can be viewed in the portfolio section of your account.
How to Sell Shares
There are 2 ways to sell shares. You can sell to market or ‘Install Sell’. Instant sell is the price you see in the red box highlighted in the image below. Instant Sell is a fail-safe feature which protects you from being stuck in a trade if you cannot sell to market. In this instance, you are selling shares back to Football Index so they add a risk factor to the price. This means you’ll often see the Instant Sell price is a fair chunk below the current value of the player (the buy price) as FI have to factor in the risk of re-purchasing the shares from you. The IS function and associated spreads are often lamented but it does allow you to get out of a trade easily if things go pear-shaped. Avoid using unless you really have to.
The optimal way to sell shares is to sell-to-market. Click the red sell button and choose the ‘Add Sell Order’ option rather than the Instant Sell option.
Football Index take a 2% commission fee on every sale. This is how they make their money. It is comparable to the commission you would pay on a betting exchange.
Dividends drive the market and the concept would not work without them. The payout figures you see are the amounts of pence per share. E.g. you hold 100 shares of Messi and are paid 8p per share after winning top forward, you will receive a total of £8 in dividend money that is yours to keep.
There are 3 main types of dividends you can win.
Match Day Dividends
FI pay-out dividends based on a points scoring system that allocates points for on-pitch performances. Think 4 points for a goal in Fantasy Premier League. Divs are paid for the leading scorer in each position and for the overall top score of the day. The scoring matrix is shown here:
The amount of Match Day Divs on offer depends on the number of games being played on that day. The more games played, the harder it is to be top scorer so the reward is bigger. Categories are split into Bronze, Silver and Gold match days as shown here:
Only players participating in the following competitions will be eligible for Match Day Divs:
- Premier League
- La Liga
- Serie A
- Ligue 1
- Champions League
- Europa League
- Euro 2020
Traders have to purchase players before 15:00 (London Time) to be eligible for Match Day Dividends. The player top of the rankings at 23:59 will win the dividends as per the Bronze, Silver and Gold days above.
There is a slight variation on this where players playing in a Champions League or Europa League match have a 1.25 multiplier added to their score to ensure that match has more importance than other matches being played on that day. This makes it less likely a player from a random league game will win the divs on a major European cup night and protects the prestige of the bigger competitions.
Media dividends are paid for players being in the news. It is based on UK media outlets so is heavily weighted in favour of Premier League based players.
The outlets monitored are: Talksport, UEFA, The FA, ESPN, FIFA, Football League, Daily Mail, Daily Star, The Times, Telegraph, Independent, Express, Guardian, Metro, Daily Mirror, BBC, Football365, Goal.com, Huffington Post and Sky Sports.
Media Dividend payouts are shown here:
Again you must hold shares in the player by 15:00 (London time) on the day of the Media Dividend. The player with the highest media score on that day wins the dividend and will be paid out between 00:00 and 03:00 the next day immediately following the eligible media day. Media dividends are paid out 365 days a year ensuring there are always dividends up for grabs even when there is no football on.
In-Play Dividends are awarded for key actions that take place in a game; goals, assists and clean sheets They are broken down by position as follows:
These dividends are only valid for the first 30 days after purchasing a share. Once the 30 day period expires the player will no longer qualify for these dividends. They are available for the same competitions as the Match Day Dividends.
Note – FI have recently added a new ‘Transfer Dividend’ which pays out 10p per share for a completed transfer or 5p per share for a completed loan. The player has to move to another club within one of the top 5 leagues or from a club outside the top 5 leagues into a club in the top 5 e.g. a player transferring from Sporting Lisbon to Man Utd would be eligible. This dividend has only recently been introduced so it’s not clear if it will be a permanent addition.
How to Profit
The aim of the game here is, of course, to make money. Your two sources of potential profit are dividend payouts which are paid directly into your cash balance and capital appreciation of your shares (the increase in the price of your shares). If you can buy a player low and sell them high then you have the chance to make some really good money. The two ways to profit are generally closely linked. If you hold a player that is regularly winning dividends you are likely to see a nice capital appreciation on their share price as well.
What Affects a Players Price
The factors that affect a players share price are many and don’t always make sense. In a completely efficient market, a player’s price would depend solely on the potential to win dividends. Currently, FI is not a 100% efficient market so there are many other factors, rightly or wrongly, that drive prices up (or down). Other variables include hype, age, transfer links, involvement in a big tournament. Predicting these variables along with a disciplined trading approach is the key to building a profitable portfolio.
Tips for Building a Profitable Football Index Portfolio
- Read the game rules. Do not overlook the importance of understanding how everything works. This includes understanding which players score well on the index. Hint: It’s not always the players that score the most goals! You can find the game rules on the Football Index website.
- Choose a strategy. There are many ways to profit on Football Index. You could target certain dividends, age groups or leagues. You can trade short term or long term. As with any trading, it’s best to decide on a strategy and stick with it. Give it time to work and if it’s a solid strategy then over time it will work for you.
- Target performance-friendly Match Day Dividend players. Whilst you can play different strategies, it’s advisable to not stray too far from having a healthy chunk of your portfolio made up of players that will be challenging for Match Day Dividends. Quality players are likely to hold their value a lot more so you’ll protect yourself from any silly trends that may be the flavour of the month.
- Be aware of trends. Whilst it’s key to hold players able to win Match Day Divs, it’s also key to know when not to hold them. Out of season with no football on, these players hold little value so make sure you sell up at the right time. Out of season, players with potential transfers see price rises so set up your portfolio with more of these players. Other trends include European club football, International tournaments and age.
- The youth trend. Age plays a big role in a player’s share price. You’ll notice there are some younger players who have barely kicked a ball that are far more expensive than regular veterans who are scoring week in, week out. That is because everyone is trying to find the next Messi. It’s also because younger players have far more of their career left so more time to win dividends. A 34 year old player, even still playing at the top level, may only have a couple of years left in his career and will be more susceptible to injuries and reduced game time. Once they retire the player has zero value on Football Index anymore.
- Sell to market. Try to avoid using the Instant Sell button to sell your players. You’ll lose more money this way than selling to market. There are some instances where you might want to use it. A player has a long term injury and you can IS before a significant pride drop. Also if you are short term trading you might pick players with small spreads which means you’ll only be losing a few pence per share when selling.
- Join a community. There are many FI communities out there. Twitter is probably the best. There’s a busy Facebook group and FI forum. You can also join the Profit Squad Football Index community to share ideas and ask questions.
- Get informed. Stats gathering is fundamental to successful trading on Football Index. You’ll come across a few stats sites where you can review and attempt to predict dividend returns. Finding a cheap player that hasn’t won any dividends yet, but looks like he will, is one of the most profitable strategies out there. Not easy to get right of course.
- Choose value. Make sure you’re buying at the right price. Try to think how much more the price can grow. Are they likely to win a lot more dividends in the future? If so the price might still increase. Has the player seen a sharp rise in price recently? It might mean the player is priced at the top of his potential. Ask yourself if you would buy at the current price. And, to state the obvious, buy low, sell high.
- Only bet what you can afford to lose. It’s not possible to lose more money than you put in and, unlike traditional gambling, it’s unlikely you’ll lose your whole investment. That being said, only invest what you can afford to. Not only will this protect you from losing money you cannot afford to lose, it will stop you from making rash trading decisions under pressure.
To Sum Up
Football Index is a fantastic innovative gambling product which is more like an investment platform than traditional gambling. Whilst the product has seen huge growth to this point, it is still young and has more room to grow, especially with talk of spreading into overseas territories. With more growth predicted for 2020, now is an excellent time to join and start mastering your trading. Happy trading!
You can join now and trade risk-free up to £500 for the whole of January. Give it a try and if you incur losses Football Index will refund you up to a total of £500.