New Traders often ask me the same questions: can I still make a profit starting fresh without bonuses? Can I still find value when other people have been here so much longer? Can I do this if I don’t have a lot of time every day?
I think the answer is absolutely yes. But rather than talk about it, it’s probably more helpful to show how it can be done.
Starting from scratch with a £1,000 balance on day one of the new season, I am tracking my progress showing not just each trade but my thinking behind them.
1) no direct use of bonus cash,
2) start with a blank portfolio,
3) long term and time efficient style, with no constant phone checking or watching every game.
Notes for New Readers
I’ll be trying to show not just the trades but my thought process and reasons behind decisions I make. The specific players I pick are less important.
You can check out the original post where I introduce my overall strategy and explain the opening selections.
As I obviously have an existing portfolio, I will not make these exact trades but they will be tracked realistically.
I will also own every player on this list for real so the selections will get my full attention. Generally, I select players I have talked about positively on the site.
I always say though, don’t blindly follow any picks you see from others including mine. Do your own research and if you see what I see, great, but you have to know why you have bought the player and be happy with it.
The 1K Challenge Portfolio
- Portfolio Value: £1,722.45
- In the bank: £11.10
- Value Increase from £1k: 73.35%
- Value Change from Week 19: +10.15%
As predicted in the last update two weeks ago, it has been a good January for this portfolio.
Overall, we are now 73.35% up from our original £1,000 bank. It’s solid. Bigger gains in this period were possible but in this starter portfolio I have been fairly aggressive without taking huge risks.
I started from the perspective that a new trader doesn’t want to blow up before they have learned the ropes. And I have made sure it is a very time efficient way to trade as that was one of the rules, too.
The portfolio had a rough December as the winter break and Manchester United mania put a squeeze on performance players. But thanks to big growth in players like Mendez and Aouar, we still came through December with a decent profit.
In January, that continued and we increased the portfolio value by 10.15%. Interestingly, that was not because of a general return to some performance players, although that did happen, but rather because of 2 particular trades: Thorgan Hazard and Joao Felix.
Aouar, Thauvin and Werner also made decent contributions to the gains, but pretty much everyone else was neutral.
This is because we have not seen a particularly rationale return to performance players. There hasn’t been a lot of football played yet in January and much of the growth has gone to hype kids or transfer speculation.
I think February will see a return to more sober times, as the transfer window shuts and more football shows up weak hype buys and highlights strong performance players.
We also have the European competitions starting to heat up, and this is the primary factor in this weeks decision making.
This next few months are actually my favourite time of the season, and the most interesting and tense from a trading perspective as we get to the business end.
Sells and Holds
As mentioned at the time on the Daily, Denis Suarez was offloaded at the £2.50 mark after his nice rise. We picked him up for just £1.04.
I could have stuck in longer, and he actually made it up to £3 before bouncing back down. But I am happy with the decision to sell. At that point, he spiked in value and I was able to offload him to those who still saw reason to buy. In an ideal world, you sell to other traders rather than taking the hit on an Instant Sell.
This freed up funds to go to our buy target discussed below who also went on to rise, so I don’t think of this as missing out on a bit extra. I think of it as taking profit and moving out of a player who is at risk of a drop. Anyone who spikes sharply in value often comes back down a bit.
This isn’t a commentary on the player though. I think he retains a decent chance of success if he does join Arsenal and depending on the type of deal that is done and whether I think he will get minutes, I may revisit it in my real portfolio, if not the Challenge.
The rest, I am content to hold for now. Some of them offer coverage for key European fixtures coming up, and in general, I do not think we have seen a full return towards some performance players who remain very undervalued in my view, such as Fabian Ruiz.
As per last time, we just pick up the one player with the Denis Suarez money from the 6th January. We go for Paulo Dybala. Why?
He is something of a sleeping giant who could catch fire very easily. And when the Suarez money was free, he had just come off a nice dip down from £7.40. Since, he’s made a small climb back up.
My main thinking here is to increase our coverage for the big European competitions which will start to hot up. We already have some in Aguero and Ruiz. But in truth the decision to focus on high growth potential value like Felix has left us a little light on big ticket Champions/Europa league players.
This will be important in the coming months because with plenty of treble and double days with limited fixtures (i.e a Champions League day) this is where premium players really justify their price tags.
Equally, I could have gone for Ronaldo, who is obviously the main man. He certainly comes at a discount right now. But he has a lot of negative factors hanging over him which make it a tricky trade to manage.
For a new trader in this portfolio, instead I am betting on Dybala stealing the show with a strong performance.
Whilst he is the underdog of the pair, Dybala is a safer bet because if I want to hold him beyond the Champions League, his prospects for a Summer transfer move are decent and that’s another way I can win.
It’s going to be a busy and interesting few weeks. The transfer window shuts. We will see more football which statistically should highlight some of the better performance players. And thoughts will turn towards European competition.
I am not planning to make wholesale changes to the portfolio in the next couple of weeks but as ever we have to keep an eye on things in case we do need to react.