An application of the option-pricing model to the valuation of a football player in the ‘Serie A League’

Abstract

Football is perhaps the most popular sport in the world. The market of football players is one of the most popular factors of the sport that makes the fans dream of each team which increases the interest around the sport. In 2013 the player Gareth Bale was sold from Tottenham to Real Madrid for 100 million Euros. Someone argues that the market for football players is inherently irrational precisely because of the sale price of certain players. This paper is based on Tunaru et al. model that is a real option based model. The aim of the paper is the financial valuation of a goalkeeper of Serie A League club. The model depends on relationship of player’s and team’s performance and the club’s turnover.