Diary of a Football Fanatic!

Hello and welcome!

I'm in the middle of a house move at the moment so everything's a bit chaotic. It was only today that I managed to get the internet up and running at the new place.

The past couple of months, I've started trading on betfair again and I'm really beginning to enjoy it now(and the profits it's been yielding!). I read something recently by Adam Todd of Racing Traders on scalp trading, which is not normally the type of trading I normally perform, but I found it helpful and, after gaining permission decided to post it below...

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The scratch trade is probably the single most important key to success in short term scalping of the UK horseracing markets on Betfair. Being able to Lay and Back at the same price without loss, and without even having to pay commission on the round-turn, is such a benefit that it has to be used to the absolute maximum. Anyone that learns how to use this powerful get out of jail free card to it’s full effect will make money as a scalper. A scratch trade is a winning trade because it will often get you out of the market before the price turns against you. A scratch trade may cost you some profits but it’s the losses that they save you that are important.

The scratch trade is like a house edge that’s actually in your favour: using the bid and offer you can make a single tick profit if the market price doesn’t move at all, 2 ticks profit if the price goes in your direction, or you can break even if the price goes against you.

For example, the market is 2.34 bid and 2.36 offered and 2.36 is trading heavily and is about to go bid. You snap up the remaining offers at 2.36 making the market go 2.36 bid and 2.38 offered. Others join the queue behind you wanting to Lay at 2.36 making 2.36 a stable bid and as the market continues to trade at 2.36 you get matched on your full amount while the market price remains at 2.36/2.38. You are now in a position to join the offer trying to Back at 2.38 and attempt to make an instant 1 tick profit without needing the market to go up. The price can remain at 2.36/2.38 and as long as both sides are trading you have a chance of making an instant profit without needing the market to move at all. If you believe that the price is going to continue rising you can put your Back offer in a tick higher at 2.40. Now you are only asking for a 1 tick movement higher to have the chance of making a 2 tick profit. And if the price doesn’t go up to 2.40 but instead actually goes down to 2.34/2.36 you can quickly try and Back your position at 2.36 to get out with no loss.

To summarise that trade, if the market stayed the same you could have made a profit, if the market went up you would have made twice as big a profit, and if the market went down you had a good chance of breaking even. With odds like that you can choose your trades by flicking a coin and still make money. The skill is not in picking the direction of the market but in reacting to what the market does as soon as you have been filled. The advantage of taking such small profits is not only the speed with which you can realize such small profits, but also the fact that the bid and offer spread makes such a huge difference to your profits and losses. Couple that with being able to get it wrong but still not lose anything and you have the formula for being able to creep forwards slowly without needing to know anything at all about the horse that you are trading on.

With all the advantages that a short term trader has, such as the ability to hold back and pick his moments, all he needs to do is get only 50% of his trades producing a 1 tick profit, 30% of them breaking even and 20% of them taking a 1 tick loss. If you can do that you can be a full time professional trader on Betfair, unaffected by all of the factors that full time gamblers have to go through like losing runs, bad patches, bad luck, lack of confidence, chasing losses etc.

Scratch trades should be aggressively sought after by the short term trader. Far from being a waste of time or a missed opportunity for profit when the price goes your way just after you’ve got out, traders with the highest number of scratch trades are the most consistently profitable operators in any exchange environment because they are the least vulnerable to unexpected moves. They are not successful because they are always winning, but rather because they’re not losing.

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Hopefully, some of the traders among you found it helpful like I did.

I'm hoping that I'll be able to post system details tomorrow and on Friday. I'm not sure if I'll have the time to post selections on top of the system description this week, but I'll try. If not, it all starts next week and I have VERY high hopes that one of the systems might at least churn out something useful .

Have a good one,

Josh. 

Hello and welcome!

Tottenham won 2-1. Granted, we had a dodgy Jermaine Defoe penalty, but it's all irrelevent to me and yours truly is brimming with glee. On the happy note, I'll commence with today's blog post on trading...

I know there are a growing number of traders out there striving to pack-in their day-job and become a full-time gambler. It's certainly possible and The Betfair Trader (see links) shows how even intermediate traders can have staggering success. There are people who make six-figure incomes from their trading and I do genuinely believe it's like driving a car - anyone can learn to do it.

I know this because there was a time when I was extremely interested in trading. To begin with, I struggled to break even, but I began to improve dramatically when I applied myself, to the point when I could consistently churn out profit.

For some reason, my interest faded and I came to the realisation that I prefered betting to trading. Since then I've gradually eased off trading, but from past experience I have one suggestion for all traders looking to be successful. Simply put, if you follow the suggestion, and you'll become a good trader.

Before branching off into that. I'll briefly cover the two different types of trading...

Firstly, there is WOM trading. WOM stands for Weight of Money and without, going into depth, it refers to trading using supply and demand principles. If there is a larger demand of people hoping to lay, they will all compete with each other and the price should rise. The opposite also applies. Unfortunately, things don't always work out as expewcted, however. It's this obstacle that makes trading difficult. 'Spoofers' (people who create false bets to get the price to swing in their favour) are one cause for this as are large bets that enter the market and news feeds on the latest happenings of an event.

Anyone interested in learning more about WOM trading can download the free trading manual (see my links), which will explain things in much more detail.

The second type of trading open to punters are strategical, that type of trading I prefer by a country mile. If we think something will happen in an event (for example, a lot of bookings being dished out in the first half of a derby match), we can back 6 booking points, wait for a few of the bookings to happen, and lay at a shorter price, to secure a 'free bet' or profits on either outcome. Again, there is a downside to this type of trading as things don't always turn out as we plan or expect.

I actually wrote a series of articels on stragies I had come up with on this type of trading. Anyone interested in reading them can locate them here:

http://www.laytheodds.com/articles/165/1/Profitable-Trading-Strategies/On-Betfair.html

http://www.laytheodds.com/articles/166/1/Trading-Football-Bookings/On-the-Betfair-Markets.html

http://www.laytheodds.com/articles/167/1/Tournament-Trading-Strategies/Soccer-Trading-on-Betfair.html

http://www.laytheodds.com/articles/168/1/Trading-the-Over-and-Under-Market/On-Betfair.html

By now I imagine some of you just want me to cut to the chase, thinking something along the lines of...

OK, Josh. That's great. So do you want to tell me the suggestion you mentioned earlier or what?

So here it is. My suggesion to every beginning trader aspiring to improve is just to PRACTICE!

Practice, practice, practice, practice, practice.

I expect some of you may sighed in disappointment when you read that. Unfortunately, I don't have a super-simple, secret formula to earn us all millions (I wish I did, though!). Without wanting to get over-philiosophical, the problem with life is that there is no such thing as 'something for nothing'. To become a good trader, you've got to put the hours in. In fact, this principle works for just about anything, but that's a topic for another day...

Imagine there is a complete beginner to trading. He's just learned the basic 'weight of money' techniques and wants to make money on the side for a holiday. He realises that there is going to have to be a learning process before he can even begin to think about beginning to make a profit consistently and he decides to sacrifice an hour of every evening to trading. I'd be willing to bet by the end of the first month, he's at least breaking even with small stakes. After a couple of months, I expect he'd be making a profit and had probably thought about increasing stakes and, by the turn of the year, I expect he'd be a good trader and well on his way to take the plunge full-time, if he so desired.

That's my two pence on trading anyway. There is more to come from me on trading, but we'll save that for another day.

Tomorrow comes the analysis of the systems performance from the past few days, so keep an eye out for that.

Have a good one,

Josh.