Fans of the National Football League’s Green Bay Packers have long been able to purchase shares of stock in the franchise. No other NFL organization sells ownership shares to its fans, though, a fact that is undoubtedly disappointing to the supporters of the other 31 professional football teams.
Last month, however, an investment group named Fantex offered a tantalizing alternative to fans of those 31 franchises. Instead of investing in your home team, why not invest in your favorite players?
Last Thursday, Vernon Davis of the San Francisco 49ers announced that he had sold 10% of his future earnings to Fantex. He joined Arian Foster of the Houston Texans, who had signed a similar deal with the group two weeks earlier.
Fantex intends to create a tracking stock for each of the players, a stock that would be traded by small investors on a privately owned (and thus relatively unregulated) stock exchange. It will represent, in essence, a fantasy football league … albeit one that is “played” with real money.
Fifty years have passed since stakeholders in the Oakland Raiders franchise of the original American Football League launched the world’s first fantasy football competition. Ever since then, fantasy football aficionados have been entertaining themselves by engaging in virtual player drafting and trading activities.
If Fantex is successful, though, individual investors will be able to add their favorite football players to their “real world” financial portfolios. Will they be prepared to do so in a responsible manner? For obvious reasons, many investment professionals are expressing concern; indeed, we might all be well advised to segregate our sporting interests from our financial planning strategies.