Graduate from footie fan to investor… We made a full beginner’s guide on how to buy shares in football club stocks for 2023.
How to Buy Shares in Football Clubs
You have to fight to reach your dream. You have to sacrifice and work hard for it.Lionel Messi (Source)
Despite the fact that football clubs are often owned by Russian billionaires and Middle Eastern sheikhs, supporters might feel more connected to the team by investing in it. In this guide, we'll discuss the ins and outs of investing in several European football teams and the potential returns and losses you could incur.
That’s because a football club's share price isn't the only thing that might be affected by the high stakes of managing a squad. Finding a trusted broker gives you a portal into buying and selling shares in a football team. The value of a football club's stock may grow and decrease depending on how well they play on the field.
In the end, putting money into a club is not just a show of support, but also an opportunity to profit from the organization's growth and success. This guide tells you how to buy shares in football club stocks even as a total beginner to trading.
No Extra Time? 🥅 See how you can buy shares in football club stocks in just 10 minutes.
How to Buy Shares in Football Club Stocks in 10 Minutes in 2023 (UK)… 4 Simple Steps
If the pressure’s on and there’s no extra time for dilly-dallying, this mini-section’s for you.
Find out how to buy shares in football clubs. We outline the easiest routes to acquiring shares in the United Kingdom in 2023. If you follow the easy directions we've given, you’ll score in 10 minutes or under:
- To set up your shot, you need to register. Joining eToro is as easy as visiting their website and clicking the “Join Now” button. Put in your information here and we'll make you a login name and password.
- Step two is to make sure you're not missing anything. Account verification through identification and a matching billing address is necessary to buy bitcoins on eToro.
- Add some stakes by funding your account. It is recommended that you have at least £7–£8 in your chosen trading currency before you begin.
- Go for the shot. To purchase shares in football club stocks, type the name of the football club you want to acquire into the search field, such as “NYSE: MANU” or AS Roma “BIT:ASR”, and then click “Trade.”
Okay, that settles it. ⚽ On the other hand, keep reading for a beginner-friendly explanation with a little more detail. Go on… It's clear that you're eager to find out more:
Act your wage.Dave Ramsey (Source)
Step 1: How to Buy Shares in Football Clubs: Research
Step 1 for how to buy shares in football club stocks is doing your homework. A 2013 research report examined the 53 management sacking dismissals and resignations at 16 English football teams listed on the London Stock Exchange during the 2000–01 and 2008–09 seasons.
The findings revealed that the average share price rises 0.3% on the day after a management executive is fired and falls 1.0% in the month following a resignation, for a total negative anomalous return of almost 8% from the trading day before the occurrence.
These results make logical sense; the dismissal of an underperforming manager may be seen as a step toward improved future match results, whereas the departure of a successful manager who leaves for a better position would likely cause a decline in the club's stock price.
Moreover, the report showed that although the effect of management exits on stock price volatilities is less clear-cut, speculation in the press is common in the lead-up to such an occurrence.
Although, not as wild as Bitcoin’s Price History…
How Football Markets React to Match Results
Researchers have looked at the factors that affect the value of football clubs several times. Many events that might affect football teams' stock values happen during the weekend when the markets are closed.
This implies that the impact of such news on a club's stock price will be seen when trading resumes on Monday. It comes as no surprise that the outcomes of matches have been the primary focus of many of the relevant research.
Using an event analysis methodology, Bell et al. (2012) evaluated the relevance of matches by determining whether or not the two teams involved are in a tight race for a playoff spot (particularly in the case of clubs chasing promotion or fighting relegation).
According to their findings, game outcomes do affect club share values, but only marginally so, and these effects are mostly cancelled out by other factors.
How Football Club Shares are Similar to Regular Companies
The expectation of performance is also crucial for football teams. According to Puffer and Weintrop (1991), the CEO is responsible for achieving the corporate performance goals established by the company's board of directors.
A sample of 408 US-listed businesses is analysed for CEO terminations to back up these results, and financial analysts' predictions are used in place of board expectations.
Farrell and Whidbee (2003) reaffirm this viewpoint by recommending that boards of directors fire CEOs based on how their company's performance deviates from expectations rather than on performance alone. There’s quite a bit to consider. Just be wary of investing your essential savings during our current recession.
Step 2: Choose Your Football Club Exchange
Fear is the enemy of hope.Dave Ramsey (Source)
Step 2 for how to buy shares in football club stocks is choosing your exchange.
eToro: Review — Popular Share Dealing Platform that Lets You Buy Shares in Football Club Companies
There are three popular methods to buy shares in football club companies on eToro. It's up to you to decide:
- ⚽ Model your football trading after those of successful traders.
- ⚽ Buy and sell football shares to profit short term.
- ⚽ Make use of CFDs.
This cutting-edge virtual trading floor was designed with professional traders and beginners in mind. One of the most trusted and widely used platforms for buying shares in football club companies is eToro (review), an online broker.
It comes at a higher price than some professional trading platforms but can be counted on.
The platform's worldwide success in the UK is shown by the fact that it has over 13 million users. If you want to acquire shares in football clubs for the first time, eToro is an excellent choice because of how user-friendly it is.
It can take less than 10 mins to set up an account, add funds, and make your first investment. The popularity of eToro is shown by the diversity of investing options it provides. Multiple shares in football club companies exist, including the market and international leaders.
Stocks listed across over 16 exchanges across the globe are available for investment. eToro also allows for the trading of many exchange-traded funds (ETFs). A long-term investment strategy? Consider an eToro CopyPortfolio. Investing in these well-curated portfolios is a great way to invest. Other than football club companies, investors have access to a variety of other marketplaces.
To start trading on eToro or purchasing shares in football club companies for long-term investment, first open an account. What you should do next is laid out for you.
- ⚽ Launch eToro’s online trading app.
- ⚽ To put money into football club companies, go to the “Trade Markets” tab and choose the coin you want to invest in. All of the currently-tradable football club assets will be listed for your convenience.
- ⚽ Navigate to the ticker symbol you're interested in, like “NYSE:MANU”, then click on it. If you go ahead and click on the link, you'll be sent straight to the necessary exchange.
- ⚽ The trading process starts once you click the “Trade” button.
After deciding how much to spend and customising other settings to your liking, you can click “Open Trade” to finalise the trade.
Step 3: Choose Your Football Club, Check it Lets You Buy Shares UK
If you’re not failing, you’re not pushing your limits, and if you’re not pushing your limits, you’re not maximizing your potential.Ray Dalio, Principles (Source)
Step 3 for how to buy shares in football club stocks is choosing your football club to invest in.
Which Football Teams Let You Buy and Sell Stock?
There are two main models for football club ownership. The first scenario includes very well-off people or businesses purchasing the club entirely and running it as if it were their own. With football having become “big business”, the high asking prices of certain clubs have made total ownership a luxury only the very well-off can afford.
A Saudi-backed group paid £305m to purchase Newcastle United in October 2021. The Public Investment Fund of Saudi Arabia oversees £250 billion in assets, so the £305 million price tag was pocket change.
Football teams that are publicly traded take a different tack. These clubs have “floated”, or been listed on stock markets, making it possible for any investor to purchase a stake in the organisation in the same way as they may invest in blue-chip firms based in the United Kingdom. We evaluate the future of a few of the most actively traded football teams by looking at their stock prices.
Largest Football Clubs by Market Cap
- 🦅 Manchester United — MANU — £3B
- 🦅 Juventus Turin — JUVE.MI — £760M
- 🦅 Borussia Dortmund — FRA:BVB.F — £400M
Source: Companies Market Cap
Manchester United (NYSE:MANU): Review — Buy Shares in MANU Football Club
Manchester United was among the first teams to list its shares on the stock market. In 1991, the club went public, and at the time, its valuation of £6.7m seemed absurdly cheap (add a zero today then halve…).
This occurred because the club's former owner, Michael Edwards, decided to sell the team to the general public to get rid of his stake. Today, it’s £3 billion.
Until 2005, when US billionaire Malcolm Glazer revealed he had purchased 28.7% of the club and assumed effective control, the club's shares were publicly listed on the London Stock Exchange.
Red Football Ltd., the investment vehicle Glazer employed, forked up a total of £800 million to acquire the remaining shares and take the company private, removing it from the London Stock Exchange in the process.
The Glazer family, after substantial reorganisation, followed in the footsteps of the club's previous owners and listed MUFC on the New York Stock Exchange in 2012. Manchester United was the most valuable football club in the world when it went public in 2005, with a valuation of £1.86 billion at a share price of £11. This was despite the Glazers reserving enough shares to maintain control of the club.
In 2012, Manchester United stock began trading under the ticker symbol MANU on the New York Stock Exchange (NYSE). Manchester United's commercial, brand, and broadcasting arrangements, together with the team's overall success on the field, have contributed to an increase in the club's share price.
Stocks Prices Mirror Success Levels
With Coinbase’s settlement and a flood of withdrawals, traders are looking for new giant assets to believe in…
Manchester United's stock price has followed the team's success since becoming public. The team looked to have turned a corner in their pursuit of the sport's most prestigious trophies after winning the UEFA Europa League in 2017. The stock price peaked at £21 in 2018, a record high, giving early buyers a return of almost 100% on their money.
Manchester United is the most valuable Premier League club and one of the four most valuable in the world with a value of £3.7 billion.
An increase in television revenues contributed to the club's 2019 revenue report of £627 million. This new arrangement with UEFA Champions League is largely responsible for the 18.1% rise in broadcast rights earnings. Since 2015, investors have been rewarded for buying Manchester United shares by receiving dividend payments.
Part of this is because Manchester United is one of the most successful clubs in Europe and has a rich history in English football. Purchasing stock in Manchester United is a viable option.
One of the Most Popular Football Club Stocks
Manchester United has become not only one of the most popular but also one of the wealthiest football teams in the world because of its on-field achievements. Manchester United, which is owned by the Glazer Family to the tune of $4.2 billion (about £3.4 billion), is now placed fourth on Forbes' list of the most valuable football teams.
The company's debt rose by 3.4% to £443.5 million in the first quarter of 2021, according to the financial figures, while overall revenue fell by 3.6% to £21.7 million. This was because income from merchandise, sponsorship, and game attendance all dropped drastically. Since 2015, investors have been rewarded for buying Manchester United shares by receiving dividend payments.
Juventus Football Club (NYSE:JUVE): Review — Buy Shares in JUVE Football Club
As with Coinbase tumbling and downsizing by 12% in the world of crypto, Juventus has in the past felt the ‘Cristiano Ronaldo Effect’, where share prices jump or tumble based on whether he signs up, performs well or leaves altogether.
Although Ronaldo left in 2021 and retired altogether, since, it’s a demonstration of how to explain changes in football club share prices.
Juventus Football Club SpA stock has traded on the Milan Stock Exchange under the symbol “JUVE” since 2001. Besides Roma and Lazio, Juventus is the third Italian team to be publicly traded.
With the addition of high-profile celebrity Cristiano Ronaldo, JUVE saw a jump in share price of more than 500% between January 2017 and January 2019. The club's chances improved thanks to the player's contributions both on and off the field. In 2018, 2019, and 2020, Juventus won Serie A.
When people succeed, it is because of hard work. Luck has nothing to do with success.Diego Maradona (Source)
Juventus Decline Since Ronaldo
Since then, Juventus' share price has declined, mostly owing to the club's high level of debt on its balance sheet, serving as a cautionary tale to football fans who could be tempted to invest in their favourite team by the promise of financial gain, regardless of how many trophies that team may win.
Along with Roma and Lazio, it is one of the three Italian clubs that trades on the stock market. Over the previous five years, the share price has increased by more than 570%, which has thrilled investors. The ‘Ronaldo effect,' as it is called, is a theory that says this occurred because the team signed Cristiano Ronaldo.
Despite its success on the field, Juventus is heavily in debt. This is reportedly attributed to the club's exorbitant player salaries. The club's debt has grown throughout the years, and as of April of 2021 was reportedly £752 million. Three causes have contributed to its mounting debt: the negative effects of the Covid-19 outbreak, including the loss of income from game days and a drop in product sales.
With a total of 36 Scudettos, 14 Coppa Italias, and 9 Supercoppas, Juventus is the most successful Italian club in history. The Agnellli family, who own the majority stake, have helped propel the company to its present position as the eleventh richest in the world, according to Forbes.
Past Successful Track-Record
With 36 league trophies, Juventus is the most successful team in Italian football history. In addition, no other Italian team comes close to its popularity. Juventus' worth had a 26% increase over the last few years.
This is one of the few Italian football teams that is publicly traded on the Milan Stock Exchange. There are only three Italian clubs that are publicly traded, and this is one of them. Over the previous few years, the share price has increased by more than 570%, which has thrilled investors. The phenomenon has been called “the Ronaldo effect” and is often attributed to the club's signing of Cristiano Ronaldo.
Unfortunately, the Italian soccer team Juventus has accumulated significant debt. As a result of this effect, Juventus' share price rose by more than 87% in the weeks after the club signed the Portuguese superstar in 2018. When he departed Juventus in 2021, the club's stock price plummeted for the opposite reason.
Borussia Dortmund (FRA:BVB): Review — Buy Shares in BVB Football Club
Borussia Dortmund, Germany's second-most successful team, is one of the most recognisable clubs in Europe. And in the first year of the new century, it made history by becoming the first and only German club to be listed on a stock exchange.
In 2000, Borussia Dortmund began trading under the ticker symbol BVB on the Frankfurt Stock Exchange. The only publicly traded German football team. To begin trading, 15 million shares were issued at €11 each.
Even though the stock underperformed for the first decade, it was a favourite shorting target.
Borussia Dortmund has several sources of income, such as the sale of sporting equipment and an interest in the travel business. It earned more than £€488 million in the fiscal year 2018–2019. The club declared its intention to distribute a £0.06 dividend to shareholders in September 2019.
Fans Can Affect Club Decisions
Borussia Dortmund, the country's second-biggest football team, is known for playing thrilling, high-tempo game and for its signature yellow jerseys and shorts. Like many other German football teams, Borussia Dortmund has a fan-centric and unusual ownership structure; in 2021, the club's most critical decisions, including whether or not to alter the club's name, were put to a vote by the fans.
The Frankfurt Stock Market is where you may buy shares of Borussia Dortmund, the only German football club listed on a public exchange. It's the only Bundesliga club to go public. As part of its first public offering, it sold 15,000,000 shares. During the first decade, shareholders had poor returns, but the stock became a favourite shorting target.
Borussia Dortmund monetizes not just commercial, brand, and media arrangements, but also the production of sports equipment and the investment in a travel agency.
The more difficult the victory, the greater the happiness in winning.Pelé (Source)
Are Football Shares Good Investments?
Make sure you're ready before making a large investment in cryptocurrency. Keep a sizable sum in a “rainy day fund” and be wary of taking on debt. If you meet all of these requirements, many financial experts believe that you should still only invest a little amount in your portfolio.
It is important to conduct your homework before buying any asset, whether it be stocks, mutual funds, or anything else. Keep in mind that you are risking your own cash for a potential gain.
Compared to something like gold, it's more of a novelty than an investment, as most individuals who buy into a football club do so as a method to show support for their favourite team. While it's not unheard of, most fans wouldn't put money into a club that wasn't their favourite. For example, if you showed up to a Liverpool game and said you owned shares in Manchester United, you'd probably get pie in the face.
It's impossible to predict the future value of a stock, just as the fortunes of various football teams have varied widely over the last five years (as of this writing).
Manchester United, for instance, has risen just 4.47% in value over the previous 5 years, meaning you could have had identical returns from a savings account. In contrast, Juventus' stock price has increased by 156.25 per cent over the last five years. Similarly, clubs have experienced financial losses; Borussia Dortmund has lost 14% over the last five years, while AS Roma has lost 9.76%.
The outcomes of the past have no bearing on the results of the future. Research the football team's present financial situation before putting money into it.
If you do not believe you can do it then you have no chance at all.Arsène Wenger (Source)
Risks of Buying Football Club Shares…
Theoretically, the stock price of a listed football club should be determined by the same factors that influence the price of any other stock: the expectation of future profits and the forces of supply and demand.
Nick Train, a fund manager at Lindsell Train Limited, argues that investors shouldn't worry too much about how a team performs in the near term because of issues like player moves, club finances, and sponsorships.
A dedicated fan base is more valuable to marketers than nearly any other entertainment medium, and that's exactly what draws us to live sports teams, said Train. Of the 12 most valuable soccer teams in the world, we possess three very different franchises: Juventus, Manchester United, and Celtic, all of which are unquestionably household names throughout the country.
While the long-term effects of the Covid scandal on football teams remain unclear, for investors like Train, ignoring the noise is the most crucial part of investing in the world's biggest sports organisations.
Long-term investing is the strategy that Train uses. This implies he takes a long-term perspective on the companies he invests in, expecting their value to have stabilised over the course of at least three years. His choice to purchase or sell is not much influenced by the team's performance on the field or by scandals like the ESL. He advises that this be kept in mind by anybody thinking about investing in a football team.
However, Fairview Investing adviser Ben Yearsley argues that when buying shares in majority-owned teams like Manchester United, investors must realise that they will have little say in the club's operations.
While the company may be publicly traded, “majority shareholders have practically entire control owing to the amount of their ownership”, he said. This lack of command was on full display during the ESL proposal, prompting strong opposition from fans.
What’s the effect of Manager Sackings & Performance Forecasts on Football Club Share Prices?
Going back to the research paper mentioned in the opening part of this guide…
Stock values of football teams do move noticeably when a bad manager leaves. When a manager resigns, it usually results in a far bigger drop in the average stock price (and eventual worth) of a football club than when a manager is fired.
These results make logical sense, since the dismissal of a manager who has been performing badly would likely raise shareholder expectations of the team's future success on the field, which in turn will boost the stock price.
The inverse is true when a talented manager leaves a club (usually to take a higher-paying position elsewhere), since this will cause the team's stock price to fall.
These results are in line with the literature on mainstream corporate managerial turnover, as exemplified by authors like Denis and Denis (1995) and Huson et al. (2004), but they are inconsistent with market efficiency, as the adjustment is still occurring a full trading month after the initial announcement. This may be due, at least in part, to the low liquidity of football company shares.
Last but not least, the departure of a football club's manager is analogous to that of the chief executive officer of a normal publicly traded company. This study's research has at least two potential future avenues for exploration.
First, it is conceivable to utilise an automated method to analyse media headlines about potential management exits and decide whether this attention may be used to anticipate the actual dates of the departures.
There is also the question of whether teams in higher divisions are more vulnerable to management turnover than those in lower divisions since it is more difficult to find suitable managers with the proper stature and experience, but this is beyond the scope of the current study.
Before making any major purchases or investments, you should take stock of your current financial standing and determine whether or not those standings align with your investing goals.
Here’s how to buy shares in football club names like Man-United in just 10 mins:
- Sign up first. The “Join Now” button on eToro's website serves as the gateway to the platform. Simply input some identifying data to get a unique username and password.
- Complete KYC. Before you can make a football club shares purchase on eToro, you will need to validate your identity and utilise a billing address linked to your eToro account. That way, the HMRC and others can keep track.
- Fund your account. If you want to start trading, you'll need to deposit at least around a tenner.
- Take the shot. Choose your football club using its ticker symbol, e.g. MANU for Manchester United. Hit “Trade” to complete.
That's it. Next… we'll go through some of the most often-asked questions about buying shares in football clubs. On with the show:
How to Buy Shares in Football Club UK: FAQs
What considerations should I make before buying shares in a football club?
Exposure to football club shares may be gained via investing in or trading for shares of the club. While both may be used to make money in the stock and forex markets, there are important distinctions between the two, especially during the recession.
You will have actual possession of the shares until you sell them, if you invest. The complete amount of money intended to be invested into a football team must be put down immediately. Make a profit by selling your shares at a higher price than you paid for them.
However, you will lose money if the price has dropped. Potential gains are also boundless, but your risk is never more than your original investment (excluding any additional fees).
Long or short trading, on the other hand, allows you to speculate on share price changes without actually holding the underlying asset. You may thus bet on both price increases and decreases. Also, since you will be employing leverage, you won’t have to put up all of your own money right now. In order to initiate a trade, just a nominal sum, known as margin, is required.
Always remember that your gains (or losses) will be amplified by the leverage, thus it is possible to lose more than you initially invested. As a result, prudent risk management is crucial.
Can you buy shares in sports teams?
There are stock markets for sports teams, and football is no exception. It’s a transaction just like using your online bank to send and receive cash. After signing up for a trading platform like eToro, you’ll have access to a database of publicly traded football teams and the ability to purchase stock in those that interest you.
Is it a good investment to own stock in a football team?
Investing in football teams might be lucrative. Additionally, you risk financial loss. Before putting money into something, it’s smart to do your homework and come up with a game plan. One of the best investment platforms is eToro.
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