4th And Short: Identifying Short Selling Opportunities in Jock MKT

By Jonathan Bell

Are you looking to take your Jock MKT strategy to the next level?  With shorting, Jock MKT has added a unique way for you to put your sports knowledge to the test to earn some cold hard cash.  

What is shorting?

Shorting, or short selling, is the process of selling a stock that you don’t yet own in the hopes to buy it back at a later date (hopefully, at a lower price).  Here’s how it works in the context of Jock MKT:  Dak Prescott is trading at a price of 19 dollars after a terrific first half against the Giants in the Sunday main market.  This price means that Dak has to finish either first or second (payouts of $25 and $20 respectively) in order for your stock to make money per share.  

Despite Dak’s flawless first half, there are some warning signs.  First of all, both of his touchdown passes were thrown into double coverage and his receivers had to make a great play to come down with the ball.  Second, the Cowboys are up 3 scores so there’s no need to pass that much in the second half.  You think Zeke is going to step his game up in the second half and Dak’s production will slow down.  You decide to short sell 5 shares of Dak at $19.  This means that if you’re right and his stock finishes lower than $19, you get to cash out at a lower price and make money per share.  If you’re wrong and he wins the contest and the shares pay out $25 a share, you are forced to buy back at that price and lose $6 a share.  

Just as you suspected, Dak threw another 50/50 ball that turned into an interception (and a pick six!).  The game got within two scores and Dallas decided to use their star running back to wind down the clock against New York’s porous defense.  Zeke ran for 75 yards and a touchdown in the second half.  Daniel Jones threw a garbage time touchdown pass to Saquon Barkley and all of a sudden Dak got bumped down to 5th place in the market, paying out $14 at the final whistle.  Congratulations, that’s a $25 profit and a 26% return on your initial investment!  So, how can we spot more of these golden shorting opportunities?

When to Short Players in Jock MKT

Different markets in Jock MKT have different opportunities to find value and one of the biggest for shorting is on NFL Sunday’s, specifically in the main or in the midday market.  These markets differ from the Sunday, Monday and Thursday night markets in the number of games with players available for you to buy (or short sell) players.  In the single game markets, it is much easier for the players that IPO the highest to finish near the top of the leaderboard and get those coveted high payouts; there are simply less players they need to outperform.  Even Christian McCaffery, who owns the record of highest NFL IPO price at $19.1, returned $4 after getting hurt and barely playing in the game.  If that was in the Sunday main or midday, he surely would have missed the payout curve entirely and returned the minimum possible: a measly $1.

Digging deeper into which players are ideal to be short sold, we find that Quarterbacks have slightly less downside than skill position players.  Quarterbacks possess the ball every offensive snap, so even in games where they aren’t playing their best they still have plenty of opportunities to salvage the game with some fantasy points.  The same can’t be said for RB’s, WR’s and TE’s.  If a running back has a case of the fumbles,  you can bet they’ll be on the bench for a while.  If a sleeper wide receiver you invested in suddenly develops a serious bout of butterfingers, his QB will start throwing elsewhere.  

This is true for even the highest caliber of skill position players, it just isn’t possible for them to have an elite game every time out there especially when they IPO at a high price.  Since the payout curve of Jock MKT is (relatively) fixed, short sells have a fixed loss.  A stock will never payout more than $25 a share, this limits the downside of shorting.  This also means that when a stock IPO’s for a super high price, it is difficult to return profit especially in a multi-game market on Sunday because there are so many players competing for fantasy points.

As you become more of a jock expert, you will begin to recognize when someone is just too highly priced and can swoop in and short those shares!  Happy trading!

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