As avid Football Index traders we’re continually on the hunt for profit making opportunities.
Today’s article will focus on one of the smaller segments of the market and how we can maximize the opportunities available here.
And so without further ado, let’s get started…
Football Index Inplay Dividends: The Basics
In my Football Index explained article, I covered all the elements behind in play dividends (which will be referred to as IPDs henceforth).
But let’s do a quick recap for those unaware.
What are inplay dividends?
In-play dividends are purely performance based payouts on the Football Index which are made in the first 30 days that you own a share for particular actions that a player performs on match day.
These positive actions are:
- Clean Sheets
From the image above, you can see that dividends are paid out in differing amounts for some of the most notable positive actions that occur on a match day.
And just as a reminder, these dividends are only capable of being won during the first 30 days that a share /shares are owned.
It’s important to note here that IPDs are not counted in penalty shootouts, as they are only accrued for events that occur within the normal duration of a game as well as stoppage time and extra time.
More so, players that score own goals are not credited with IPDs. In such scenarios, Opta may choose to credit the opposing player last involved in the own goal with an assist.
When are inplay dividends paid?
The specific timing usually varies from case to case, but in-play dividends are usually paid out by the Football Index on the following day, usually in the early hours of the morning.
So now that we’re all aware of the basics, the fun begins!
I’m now going to show you how to take advantage of these pay outs.
The first thing we need to perform is…
The upcoming fixtures are a great starting point for those trading for IPDs.
We’re mainly looking for teams with a nice and easy run of games within an upcoming 30 day period.
In addition to this, the more fixtures there are, the better.
There’s a greater chance of IPDs being accrued with more league and cup matches to play within the 30 days.
Sounds pretty simple right?
Well, it can get a little more complicated than that in reality.
This is because what’s regarded as an “easy set of fixtures” is usually relative.
A run of games that may be classed as easy for a club like Manchester City may be more challenging for less talented teams like Southampton or Newcastle (no offence to the fans of these teams intended!)
So how do we simplify the process of fixture forecasting?
Well here are my very own suggestions…
Look at the Statistics
Certain statistics can give a good indication of how easy a team is to play against.
I would normally look at the things like:
- Number of chances conceded per game
- Number of shots conceded per game
- Number of goals conceded
It goes without saying that teams that concede a high amount of chances or shots per game represent a great opportunity for IPD returns.
Opposing players coming up against teams with such vulnerabilities can capitalise on having more opportunities to score goals, provide assists and keep clean sheets.
On the opposite side of the spectrum, I look for teams that generate a high amount of shots and shots on target per game, as well as a decent number for goals per game as this gives me an indication of their attacking prowess.
Use Fixture Difficulty Ratings
This is a fairly useful metric that can – at a glance – give you an insight into the difficulty level of an opposition team.
These ratings are used quite prominently among Fantasy Football games and, in the specific case of the Fantasy Premier League, a simple integer scale of 1 (very easy) to 5 (most difficult) is used.
IndexGain premium members have access to a more granular fixture difficulty tool that uses a fractional scale of -1 (hard) to +1 (easy).
So for example, Bayern Munich may have a home fixture against Union Berlin who are assigned a difficulty of 0.76, which is relatively easy.
My advice on fixture difficulty ratings is to use them as a general guide and in conjunction with other metrics, and not as the primary basis upon which your final trading decision lies.
And this brings me onto my last point regarding fixture analysis…
Check the Dates
You would be surprised how easy it can be to miss out on an extra IPD eligible fixture because of forgetting to do your due diligence.
And it would be a shame if you made a purchase today on a player you were eyeing, instead of just waiting one more day to receive the extra IPD eligible fixture for the player in question.
That could be an extra goal or two – and therefore an extra couple of pence in IPDs missed out on because of buying a day early.
So now that you understand how to conduct basic fixture analysis, let’s talk about the sort of player research needed for IPD trading.
IPD Player Research
The general recommendation is to target players who are reliable first team starters that play the majority of minutes in every game.
I’d personally be targeting players who consistently achieve 80 minutes or more per game.
However, as opposed to PB trading, a player being benched is not really much of an issue as IPDs can still be won if the player in question comes on as a substitute to score or assist.
The only downside here is that they’ll have less time to grab the goals or provide the assists.
Now let’s dig deeper here.
For each of the playing categories (i.e. forwards, midfielders, defenders and goalkeepers) I have a rough template that I tend to adhere to when making IPD purchases.
- Must be below £1, ideally under 70p
- Prolific goal scorers preferred; can realistically score 2 goals within the month as a baseline target
- First choice penalty taker preferred
- Must be below £1, ideally under 70p
- Decent record of past goal scoring and/or assist provision
- Set piece takers preferred
- Must be below £1, ideally under 60p
- Goal scoring threat is preferred as a goal is worth 2p IPDs for this playing category
- Attacking wingbacks and defenders on set pieces ideal
- Must be below £1, ideally under 50p
- Less liquidity in goalkeepers, so purchase fewer shares and ensure spread is low
- Clean sheet potential a must
- Minimum of 4 league games; ideally 6 or 7 games within 30 days to maximise clean sheet chances
Now you’ll have noticed a common theme present across all the playing categories above.
The IPD target must be priced below £1.
This isn’t to say that IPD prospects above £1 are an absolute no-go, as there are very good goal scorers who exceed this threshold such as:
- Gerard Moreno – £1.20*
- Paco Alcacer – £1.25*
- Wout Weghorst – £1.15*
- Wissam Ben Yedder – £1.16*
- Jamie Vardy – £1.19*
- Danny Ings – £1.19*
However, in order for IPDs to be a viable strategy to use as a trader, the returns must be worthwhile.
The general rule here is that:
If you’ll have to pay more in commission to sell them than the amount of IPDs you think they’ll earn in 30 days, then they’re too expensive and not worth buying for IPDs.
Which is why players whose prices exceed the £1 mark are harder to profit on because of the larger spreads and commissions.
Doing the Maths
Let’s use an example comparison to illustrate this point to better effect.
Pierre-Emerick Aubameyang has been scoring tons of goals throughout his career.
And at a buy price of £2.09* at the time of writing, you’d think that he’d make a good IPD purchase especially if you are new to the platform.
Now of course spreads are at astronomically high levels currently because of the ongoing coronavirus crisis. But let’s say that we market sold 300 shares for £2.09 after accruing 4p in IPDs (no capital appreciation).
That leaves you with a small loss after commission of 54p.
Now on the other hand, we have Edin Dzeko at a current buy price of £0.70*.
For arguments sake, let’s say we market sold our 300 share stake in him without any capital appreciation, just like Aubameyang, and with a similar 4p in IPDs accumulated over the period that we owned him.
The profit after commission would be £7.80.
So you can see here that purchasing Dzeko would give you nearly £8 profit whereas with Aubameyang the trade wouldn’t be worthwhile as it would cost you 54p!
More so with Dzeko, you’d only need a 1p rise to hit the initial profit point whereas with Aubameyang, you’d need a 5p rise to hit the same target.
The example you’ve just read clearly shows that the cheaper you go, the more “bang for your buck” you receive with IPDs.
Additionally, you can get far greater pay outs on IPDs at the lower end of the market as you’re able to purchase shares in much greater quantities.
The takeaway from this is that anyone playing in an eligible league can win IPDs but to make this strategy worthwhile due to 30 day expiry and 2% commission, the player must either be very cheap in price or very prolific in scoring goals and providing assists.
Preferably, you’d want a player who ticks both of those boxes.
And just another thing to note is that the example given was very simplified and didn’t take capital appreciation into account.
Trading for IPDs alone can be profitable as you can see from the Dzeko example, but there’s definitely a strong case for having a strategy that’s geared towards capital appreciation whilst considering IPDs as a bonus used to pay off commission.
Now let’s move on to the final point…
Having an exit point for your IPD holds is also very important.
As the Football Index has continued to grow from strength to strength, the popularity of various trading strategies has risen along with it.
And you know what happens when the majority of people catch on to a certain trend.
The advantage dissipates quite quickly.
Part of the appeal that the IPD strategy had in the past was that if a player banged in a couple of goals within 30 days their share price would rise quickly as people jumped on for the IPDs.
If you had planned your purchases well ahead of time, you could have made significant profits from capital appreciation in addition to the IPD pay outs.
It has been suggested on numerous forum threads how the platform was pre-share split, where it apparently took only 100 shares purchased to move a player’s price up by a penny.
Now that it supposedly takes 900 shares for a penny increase, capital appreciation off the back of good on-pitch performances for IPD players isn’t as forthcoming, meaning that timing your exits on players is critical.
This is why in some cases, you could be better served holding onto an IPD player beyond the 30 day eligibility period.
Even if you lose a bit of capital appreciation by holding after the IPD period has expired, you can usually recover it by market selling on the resulting spike that occurs after the player has scored another goal or two at a later date.
This post turned out to be longer than I had initially anticipated!
But I hope it was useful enough – for those that read it all through – to use as an actionable guide for trading centred upon Football Index inplay dividends.
*Prices correct at the time of writing