Around 30 soccer clubs are listed on international stock exchanges worldwide. Shares in European clubs show a mixed performance. What do Arsenal FC, Borussia Dortmund, Juventus Turin, Celtic Glasgow and FC Copenhagen have in common? They are all listed on the stock exchange. In this context, shares in soccer clubs are generally considered speculative. However, this does not mean that such an investment is generally not advisable. We would like to present both positive and negative examples of soccer clubs listed on the stock exchange. Turkish clubs are not taken into account. On the one hand, their purchase requires a Turkish tax number, and on the other hand, it is associated with considerable political risks.
The Tottenham Hotspur share - only represented on the stock exchange for a short time
The legendary English club Tottenham Hotspur is considered a stock exchange pioneer because it was the first soccer club in Europe to issue shares in 1983. But the stock market listing was to prove a major disappointment - both for investors and for the club itself. The share price performance was anything but successful. Then, in 2012, the financing for the necessary redevelopment of the Tottenham Hotspur stadium turned out to be extremely difficult due to the poor valuation on the stock exchange. For this reason, the company withdrew from the trading floor in the same year.
The Manchester United share - uninspired, but largely solid
The traditional British club Manchester United went public in 2012. Even in the first few days thereafter, the public limited company struggled to achieve prices that did not fall below the issue price. This was partly due to the fact that numerous experts considered the price of $14 to be overvalued. Thereafter, there was a certain recovery, but the development of the quotations cannot really be described as successful. An extended and persistent sideways movement with many moderate swings up and down are characteristic of this value. Today, the price fluctuates around 16 US dollars and does not promise any big surprises for the near future.
Ajax Amsterdam - bitter loss followed by consolidation
The IPO of the successful Dutch soccer club Ajax Amsterdam took place in May 1998. At the beginning of the new millennium, the share price began a real downward slide, which, starting from a value of 12 euros, could only be stopped at a price of slightly less than 4 euros. Since then, however, share prices have recovered significantly and settled at a level of just under 9 euros.
Important aspects for the development of soccer shares
A soccer club is a commercial enterprise that generates its revenues from various sources. When deciding whether to invest money in a soccer club, one should therefore assess whether a club has sufficient revenue from various sources to achieve a positive balance sheet.
In addition to ticket sales, merchandising of fan merchandise, sponsorship agreements and the sale of television rights, among other things, play a significant role. The development of the value of shares in European clubs is also crucially dependent on their sporting performance. The reason for this is the extremely lucrative participation in international competitions for the clubs. The UEFA Champions League in particular is a real money-spinner for the participating clubs. Meanwhile, the winner of this prestigious soccer competition between Europe's top clubs receives a bonus of over 15 million euros. In addition, tickets for Champions League matches are in high demand and fetch correspondingly high prices. The transfer of top-class players can also have a value-enhancing effect on the price of a soccer share.
It is also important to note that this investment with https://trade-exness.com/mt4/ is more dependent on the right time to buy and sell than other shares. This is due to the high volatility of the prices. Since price swings often follow significant sporting successes and losses as well as other club-related events, for example a change of coach, favorable entry and exit prices can be identified relatively easily.
Conclusion:
Shares of soccer clubs are to be classified as very speculative
For this reason, they are only suitable for investors willing to take risks
It seems advisable not to subscribe to soccer shares at the IPO, but to wait for the price development of the first months first.
In addition, constant monitoring of the performance of both the club's soccer performance and the share price is essential.