How it would be if Fantasy Premier League is played using Warren Buffett's investment methodology

Warren Buffett
Warren Buffett

Warren Buffet is widely regarded as one of the greatest value investors in the world. With an astounding value of close to $US85 billion, he is a master at investing.

One of the key fundamentals about value investing is that you look for stocks that are under priced in the current market, and would give steady returns in the long run. Instead of looking at the stock, you look at the business, buying the stock on the potential that the business will generate positive cash flows in the future.

While that is a whole lot of finance, lets try to see how that would translate into the footballing world.

Trying to invest like a value investor would mean that you would not buy a player merely on form. You would try to buy a player on his potential for the season. Teams matter a lot, as a big team would be far more stable compared to the smaller teams.

A shrewd value investor would end up spending on someone like Trent Alexander-Arnold
A shrewd value investor would end up spending on someone like Trent Alexander-Arnold

Having said that, players from big teams might be overpriced in some cases. Often the undervalued players would be from the smaller teams.

In defense, I believe that a shrewd value investor would end up spending on someone like Trent Alexander-Arnold. Not only is he under priced, but he plays for Liverpool. You are not only investing in the player, but also the team. Liverpool has a good defense, and are title contenders, so they are bound to keep more clean sheets than other teams. Gomez would also be a good option.

Another defender who I believe would be a valuable player is Wan Bissaka. He is far too affordable to ignore as a player, and the value he brings to one's team at his price is incomparable.

I personally believe that Alonso may be slightly overpriced. David Luiz on the other hand, is a steal. While individually he is not the greatest defender, but as a team, he may work.

Having a midfielder who plays as a striker is ideal
Having a midfielder who plays as a striker is ideal

In midfield, one player who I believe is undervalued is Richarlison. His price has risen, but we forget that he is playing as a striker. Having Richarlison is like having a striker for 7 million in a good Everton team.

In the long run, strikers are bound to score more than midfielders, and so having a midfielder who plays as a striker is ideal.

David Silva or Bernardo Silva would also make my list of value buys. They are not necessarily cheap, but they are great buys considering that they play for Manchester City.

I believe that Salah is far too expensive despite his return, and so if I really want to buy a stock with a big name, it would be Hazard. This comes down to personal preference, but one of the biggest concepts in value investing would be ignoring short-term market fluctuations and sticking with your investment philosophy over the long-haul. So a Salah hat-trick would not persuade me in purchasing him if I was value investing.

He is slightly undervalued
He is slightly undervalued

I also believe that Fraser would be a wise buy. I do not believe that he is undervalued, but Bournemouth is known to play expansive football. When not playing the top 6, Bournemouth are bound to score goals, and so in the long run, Fraser would be a wise option.

Finally, for strikers. I would go for Vardy. He has proven himself in the Premier League, and he is expected to be back from injury soon. He is slightly undervalued, and so now would be a decent time to buy him.

The point of value investing would be to not make any changes to this team. So if I was to create a team today I can stick with for the rest of the season, I would feel comfortable sticking with players like Alexander-Arnold, David Luiz, Wan Bissaka, Fraser, Eden Hazard, Richarlison, Bernardo Silva, and Vardy. The rest of the team would really depend on how much money I have left.

Disclaimer: I am not stating that this is how Warren Buffett would create a Fantasy Premier League team. I am simply trying to demonstrate the style of value investing.

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