5 Steps to Becoming a Smarter Trader

Updated: Jun 26, 2020

People often ask us for tips in their concrete form. Who to buy. They don't ask why. They don't ask when. Some people want trading to be plain simple. There are plenty of ways this can work, and we have previously been willing to provide a few tips here and there. It's their risk not ours after all.

But traders - please respect yourself a little more. You are risking real money in a vastly unstable economic time. Football Index offers an incredibly lucrative platform compared to most global stockmarkets. Wise up and this can be a second income.

Give a man a fish, you feed him for a day. Teach a man to fish, you feed him for a lifetime.

You should invest in yourself a little whilst trading on the index. Educate yourself. Learn the best times to buy and sell, learn the reasons why a player is going to be a success or flop on the index. A little effort in research goes a long way on this platform.

The Index Gurus have vowed to provide Wisdom in Football Index. We want traders to wise up and maximise their profits. Somebody has to lose on Football Index. We don't want that to be any of our members.

So here are 5 simple ways you can improve your trading strategy. They are simple rules of thumb that when applied to an entire portfolio work. Tried and tested by ourselves. There will always be exceptions to each of these rules, but when you put these into place over the bigger picture, you'll be trading with less risk and more reward.

1. Don't buy on Matchday.

Be proactive, not reactive. If the game is on/over and the player has scored a brace, you've already missed the boat. Another one will come though. This is a rule that across the overwhelming majority of occasions comes good. A good performance gives potential PB divs and maybe even media divs. But on most of these occasions, the dividends don't pay particularly well for the price you've bought at. Plenty of traders jump aboard and may even turn a very small profit from flipping the shares on the same day. The player then dips in value in the coming days after a matchday. You can of course then hope the same again happens next matchday and your player rises in value - but is it likely? You are jumping on a wagon of hype from one match. If you believe it's a good long term hold, wait a couple of days then buy the player when his value has dropped off again.

2. Place Bids during off-days

The new matching engine has given traders the ability to purchase shares at prices lower than the market buy value. In simple terms, you can buy players at a discount. If you're eyeing up a player after a good weekend of football, they may be in high demand (as discussed in our previous point). The Instant Buy price is likely to be marginally higher than usual. If there's media surrounding a good performance, it will last a day then die. When it dies, a players value drops a few pence and the spread widens. Place a bid in the immediate off-days (sunday/monday/tuesday) when traders are more likely to instant-sell. You'll get your shares for cheaper. No complaints.

3. Do your own research.

This seems a pretty simple statement to make, but the number of traders who take a punt on a player without knowing anything about them is bewildering. As an absolute bare minimum, you need to know their age, club and average PB rating over the season. This gives an indication of how 'good' they are on the index at a glance. Their stats including goals, assists, passes/key passes completed and dribbles completed are also very important to assess if you're searching for a PB winner. Then their form, personal situation, fitness, club form, upcoming fixtures, their role in a team, transfer speculation, contract length and international football prospects should also be factored in. There is more to the index than seeing a 20 year old who's scored a couple this season at club X. There's also more to an investment than 'he might be transferred'. The more you know, the greater your judgement. Take responsibility for your own money - your trading activity is your risk. Reduce the risk, wisen up.

4. Set goals.

Tipsters throughout the FI world will all tell you of players to buy. They'll share their tips and traders onboard happily agreeing that it's a good investment. But do they ever tell you when to sell? Traders need to assess for themselves when they want to sell. Are you looking for a 10% rise in value? Is it a one-season hold to mop up dividends then sell? Is your player a three year long-termer that will be cashed out the day before expiration? Are you hitting the £4.00 value then aborting? There are plenty of ways to set goals on the index. Traders buy without knowing when to sell, making it incredibly tempting to continue to hold shares when you see your player doing well. But greed fuels the index. You'd rather cash out at a goal than hold too long and dip back down in value. Set a goal and try to remain vigilant. If he hits the goal, be happy - regardless of whether he goes on to double in price. You can't lose on the index if you meet all of your goals. There's nothing wrong in setting a goal as a baseline, then continuing to hold shares to reach a second goal. If he dips you can then cash-out knowing you met your original goal. Just keep setting milestones to ensure you are on track and not simply holding in hope.

5. Consider other traders at all times

Football Index is a Stockmarket that runs on a supply and demand basis. This crucially means if more people are selling than buying, the player will drop in market value. People often consider the great 'rocket rise' when traders mass on-board a player. But have you thought about the reverse? Traders that see a price dropping will consider cashing out their shares at a profit before the value dips further This gives the snowball effect, crashing a players value through mass off-loading.. The most common time this is seen is during a transfer period. If you are buying a player in hope of riding a rise in value surrounding transfer speculation, then be prepared. If thousands of traders buy shares with the goal of making a profit through a value-increase and media PB about a transfer, then they will also have the transfer day as an earmarked time to sell. Over months of gradually onboarding for the transfer hype, when the transfer is signed and the speculation ceases, mass off-load can occur. A players value crashes. Keep this in mind when you buy a player value - how many traders are thinking likeminded? If you think everybody is offloading at transfer day, sell before then to reduce risk. If you think a player is being sold when knocked out of UCL, then sell just before that happens. Be proactive, not reactive.

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