Fat Fingers and Cross Matching

Pretty good example yesterday of how the cross matching can create wild spikes across the market if someone or someone's bot has a big accident.

Its was an outsider so most manual traders of the favorites would have had a 'wtf' moment during this activity.

My advice is not to panic with irregular jumps in the market and take a look at the bigger picture before exiting positions

Weight of Money (WOM)

WOM was one of the first indicators I learned to use when I started trading 5 years ago. I recall watching Adam Todd’s scalping videos using the early Bet-Trader. I’m pretty sure he was the first to introduce the ladder interface and that combined with WOM and momentum trading made for a solid foundation to build on.

As the Exchange evolves so do the characteristics of the indicators we use and WOM especially has become much more difficult to interpret. It can be used to trap, hold, manipulate and the recent introduction of cross matching  brings even more distortion to how WOM is perceived.

Below are two examples from today where WOM is clearly evident.  It’s pretty rare to see volumes of this size being matched especially on races like this with low turnover. Bearing that in mind my advice is to ignore its presence.... sometimes easier said than done!

The Masters at Augusta

I Plotted up at around 7pm yesterday to watch this fantastic golf event and with the laptop nearby I waited for the story to unfold. I felt sorry for the 4th round leader Mcilroy who was having a nightmare but the entertainment provided by the other players made for spectacular viewing and some good trading opportunities. It was hard to keep up with it all at times with 6 players having a share of the lead and a few more only one shot away.

I'm a keen golfer myself and I had a few ideas on how I could trade this event after experimenting with stats in the past. I got off to a steady start when Mcilroy was in meltdown and the late surge from Tiger Woods made for some great swing trades. I had a scare late on when my internet failed and I had to scramble on to the Betfair mobile app to close a position but apart from that it was great fun trading a sport that I enjoy watching.

Back to Reality

I decided to take last week off after a great Cheltenham. According to the Bet-angel forums it was a tricky week on the trading front and with the great weather we had in London It was a good decision to leave it alone. There was one day where I finished playing golf by 2pm and I was tempted to race back to the office and trade but I stuck to decision and went back to the first hole to work on my handicap instead. I think it’s important to take time out and recharge, trading is intense and can slowly wear you down without you realising.

Shot of the day

(This almost never happens!)

Cheltenham

It took me a little longer to adapt to the big meeting this year. It’s no surprise really as I was experimenting with Betdaq for half of the Cheltenham races, something I’ve never tried before but by the third day I was flying and had my best two days in over a year. Betdaq markets are a different beast. Although they follow Betfair very closely in terms of prices they can feel very illiquid in contrast to Betfair and the fill rate frequency is lower so a different approach is needed. 

It’s a shame but I do try not to get excited or have any kind of opinion on the horses even in these big races. At the end of the day my edge isn’t form/opinion based and if I started to mix this into my trading it would just be plain gambling.

 Betdaq

Adapting to Big Meetings

This week see's the first Major meeting of the year at Cheltenham. I always look forward to tackling these markets as they are very different to normal race cards. There seems to be bit of a "marmite" feeling amongst some traders with these and depending on your trading style it might be quite tricky for you especially if your expecting too much. My advice is to take it steady on Tuesday and feel your way into things slowly. You dont want to do what i did last year and have a negative start. I wasn't totally prepared for this type of market and ended up having to fight back Cheltenham losses on the weaker cards which made for some nervous trading on day one. As the week went on I got used to the bigger volumes and became much more patient in "slow motion" markets. The only nerves i may face this year are if Betfair crashes and i have to make a counter trade on Betdaq, but that's another story that frustrates me so much i dont talk about it.

My preparation for Cheltenham this year has simply been to stick to the goals i set in January. One of these goals was to try and go 25/50/100 races without a losing race. I have now achieved two of these targets and although I may not be making as much profit were I to take more risks the benefits I'm feeling elsewhere are  outweighing any thoughts of P&L. It has helped me become much more confident in my trading again after poor end to last year. I almost feel Invincible in the markets and working towards these goals is helping to eliminate some of the bad habits and weaknesses that had crept into my game

50 Not Out

Fingers crossed Betfair can prove us all wrong and hold up this week. Good luck everyone!

Sam

Expectations

I read a post on one of the forums the other day, something along the lines of:

         How much can I expect make with a £1000 bank on Betfair?

Like any Betfair forum he was instantly given some stick by seasoned traders and probably won’t return.

Various figures get mentioned here and there about how many people actually succeed on Betfair long term but one thing is certain to me. If you expect to make money from the start you are very much mistaken and will probably fall at the first hurdle. You’re much more likely to progress by expecting to lose your initial investment learning the ropes and suffering the harsh lessons made by all beginners. Evidence of these ‘horror’ stories are scattered on blogs and forums all over the web and this is only by those honest enough to admit it. What about the rest?

Expectations can not only affect new traders but also experienced ones. After 5 years of trading full-time I expect certain results from my trading and when things don’t go to plan it can cause issues in my ability to be focused on markets. This year I’m working much harder on being market focused and not thinking about my Profit & Loss. Even on really good days, thinking about what you’ve made ‘so far’ can alter your decision making and you will probably end up trading over defensively. How many times have you been on for your best day yet only to have a few losses that bring you back down to average?

I believe that the more experience you have, the harder it is to lower your expectations. But just because someone has more experience it does not mean they should expect to perform better than others in the market. Like in any professional sport, new players come through and everyone else has to up their own game to stay in a team or to hold on to a trophy. This rings true on Betfair and other financial markets. 

It really is a survival of the fittest. 

January and Other Sports

 January

January is never an amazing month on the racing calendar. The poor quality meetings and abandoned race cards can be very frustrating. Many races offer little opportunity and Ive found that being patient and trading defensively is the way to go. Ive managed to beat the previous years January totals and with some extra profits from the Australian open its been a decent start to 2011.

The introduction of the cross matching to racing has also had an effect on the mechanics of the Win market and I imagine certain players are noticing  changes for the better/worse. It certainly wont affect everyone but it will be interesting to see how things pan out over the next few months

Other sports

In the past when I'd ventured into other sports I always struggled to adapt. Using the wrong stakes and a clear lack of knowledge on how these markets worked led to some harsh lessons in football which put me off for a while. However, since last year Ive learned how to approach new sports with a completely fresh mindset and money management plan. The tools on Bet-angel: Soccer-Mystic and Tennis-Trader have really helped me to understand the market mechanics and now around 10% of my trading income comes from trading other sports. Understanding how other markets work can also be beneficial when referring back to your primary market. I know a lot more now about the book % and how markets are balanced.

Betfair site maintenance

Betfair returned around midday today but was not functioning at all well. Its best to take the day off in this situation as the market could fail at anytime leaving you exposed. Hopefully it will be sorted in the next few days.