Football Index Insight – Neymar v Neres Part II

In my previous article last month, I considered the potential return on investment if you invested £1,000.00 in both Neymar and David Neres and held the shares for a year. My conclusion was that the end of a year, although Neymar would almost certainly win substantially more media and performance buzz dividends over that time, ultimately Neres was the better hold as more profit could be made in terms of the likely increase in share price.

Perhaps that should have convinced me that I didn’t need to add Neymar to my portfolio, but the fear of missing out tightly grabbed hold of me again and I decided that I needed to make room for both Neymar and Neres in my portfolio. That way, I could truly test my theory.

So, I took the plunge and on 10 February 2018 bought 100 shares in Neymar at an average £9.42 per share, re-jigging my portfolio somewhat in the process. The share price quickly dropped a couple of pence to £9.40 and I was instantly cursing my rashness and stupidity for investing in such an expensive player.

However, on 13 February, the day of the PSG v Real Madrid Champions League game Neymar won the media buzz. That gave me a £5 dividend, my first in a while, and I was feeling a bit more content with my decision. The day after the game Neymar won the media buzz again. Another £5 dividend. Great! Then, on the Saturday, Neymar won a treble performance buzz which resulted in a £12.00 performance buzz dividend! That all meant in the space of 7 days I had won £22 in dividends just from Neymar.

As a result of his recent media and performance buzz dividends, confidence in Neymar grew to the point that before PSG played Marseille on Sunday 25th February, he was up to a record high of £10.95 per share. I was now £150 in profit on the share price, and in just under 2 weeks had made £22 in dividends on top.

In comparison, the share price on Neres had actually dropped a couple of pence and consequently I was beginning to question everything I thought I knew!

However, unless you have been hiding under a rock for the past couple of weeks, you will of course know that Neymar suffered an injury late on in the match against Marseille. As news filtered out that Neymar had been stretchered off the pitch with an unspecified injury, panic set in amongst some traders and his price rapidly dropped to £10.28. Disappointing I thought, but I was still in profit on the player and was confident praying the injury would not be so serious as to mean his participation at the World Cup in June was in doubt.

I was slightly concerned about how low Neymar’s share price might fall, but he won the media buzz the next day, the 26th, and again on the 27th & 28th February and 1st March which meant after 4 consecutive media buzz wins I had made another £20 in dividends from him!

Once the nature of Neymar’s injury had been confirmed, that he had suffered a fractured metatarsal and, following surgery, would likely be out for 2-3 months, his share price dropped again to a low point of £9.79. This quickly picked up though, and by the end of the 1st March he was back above £10.

Neymar won another media buzz again on 6th March, the day of the return leg of PSG v Real Madrid, so at the time of writing I have won £47.00 in dividends from Neymar and with the share price at £10.06 I have a £64 profit on the share price.

For me, after a month of holding Neymar, all is well and good, and it looks like his price will continue to recover to previous levels if not higher. Just the dividends I have won from him in the last month alone have given me almost a 5% ROI. That is incredible really and shows that there are always opportunities to make money on the Index.

However, what if I had made the decision to invest in Neymar a couple of weeks later than I did? I could potentially have 100 shares of Neymar at £10.95 and now be looking at nearly a £100 deficit on the share price. Although I would have had £20 in dividends I would currently be around £80 in the red.

Whilst I fully expect Neymar’s share price to recover to the levels it was before he suffered his injury it illustrates the risks involved.

For me though, what it also illustrates is that even though Neymar is now injured for 2 months, such is the confidence in him that his price hasn’t really dipped much below £10 per share.

The conclusions I reached in my previous article were based on that Neres was a less risky hold than Neymar as his share price was lower and so there was less scope for the price to drop significantly.

What would happen though if Neres was to suffer a similar type of injury to Neymar?

I suspect now that his share price would fall by an even greater percentage than what Neymar’s has and would take significantly longer to recover to previous levels. On that basis, does this mean that Neres is actually a far riskier hold than Neymar?

Given that Neres is such a talent, and in my opinion is destined for a move to a team in a big European league in the next year or two, he seems like a bargain at around £1.20 per share. However, if the last month of trading has taught me anything it’s that the Football Index market is not based purely on how good a footballer you are, it’s their ability to win dividends that counts, something Neres has no current history of.

For now, I remain of the view that at the end of a whole year, i.e February 2019, barring any unforeseen disasters such as a catastrophic injury to either Neymar or Neres, I will have more profit from Neres than Neymar… but watch this space!

Related Posts

This website is strictly for over 18’s. If you do have any concerns about gambling please contact GambleAware
© 2023 The Gambling Times. All rights reserved.