Hi RB,
Firstly on keeping cash. There is nothing wrong with keeping a little cash in reserve. It can help if one of the Rookies you chose early was just the wrong choice, and you need to bring in that higher priced Rookie that has started 95, 98 and has a super low B/E. If it turns out your Rookie choices are ok, the cash makes your first upgrade a bit easier.
The theory of spending as much as your money as you can, is right ...... in theory! You just have to be sure you're not spending the money for the sake of spending it. If you've filled your round 1 side, and have say $130k left, I think you are better to sit on that $130k, unless you think you can make at least a 20-25/week improvement to your side by spending it. The most common mistake in spending this money is turning a Rookie into a Karnezis, because you've convinced yourself he can score 80/week. 9 times out of 10, when you "upgrade" that Rookie to a $230-$300k player, you will regret it, and think later, "I just should have kept the cash!"
On keeping cash in the hope that a Premium will fall $200k quickly. The analogy of a trade = $200k is about right, I certainly wouldn't burn an early trade to get $50k. But look how hard it is for a player to drop $200k. We'll use Ablett as an example, as the higher the Price, the bigger the potential to fall quickly.
These figures are only approximate, as we don't have the Magic Numbers for weeks in advance, but according to
RAMP, for Ablett to fall $200k by the time he has played:
Round 7 - he'd need to score 88 every game to fall $202,400
Round 6 - he'd need to score 82 every game to fall $203,000.
Two things you can see straight away. First, it's really hard, even for the highest priced players, to fall $200k quickly. Secondly, do you really want to pay $490k for a player who has only scored at 88 for his last 7 games?