This is a phrase I’ll often quote when advising people on how to trade.
Your real objective when trading
It’s really nice to bang in some massive results now and again, but generally, that’s not what trading is about.
Most of the time I’m in a market I’m just looking for an opportunity. Something I recognise as having a decent chance of a payoff, with as little downside as possible. Sometimes you just can’t see them and sometimes they are all over the place. But generally, my main focus is not on making money, just not losing it.
By that I mean I’m actively trying to reduce my chance of a loss by either not participating in a market I can’t ‘read’.
I tend to reduce my stakes when I’m less certain or waiting carefully for an opportunity. I know I will get a profitable trade, whether I am looking for it or not, so I’m just trying to reduce the risk on it going wrong.
There is often an impulsive tendency to do something when trading, but I’ve learnt that patience is key. Let the market be your slave and not your master. If you can’t see an opportunity it probably doesn’t exist.
Strike rate
The worst you can do over long periods of time when trading, is winning 50% of the time. If you practice a bit you can bump up your winning trade percentage by getting better and better at spotting opportunities.
Once you are in a profitable trade you then need to squeeze out of it what you can. This helps you tip the balance in your favour when the inevitable losses arrive.
Avoiding a loss is often a case of realising you have been an idiot and exiting quickly when your wonderful theory behind a trade has broken down. A lot of people struggle do this, as it requires humility, self-criticism and a cool head.
Sometimes things just don’t work out and you may not even know why. But realising that is the key. But there is also some focus required on the upside.
Often the biggest mistake I make is hanging on too long. A wonderful trade ends up collapsing to a modicum of itself by post time. But generally you are not aiming for that massive total, you are aiming much smaller than that.
The average range in a market is reasonably predictable and therefore once a move has taken place, you would typically expect it to have its limits before it starts to correct itself. Therefore as soon as I enter a trade, I start putting my closing positions in much further up or down the ladder.
This means I know where my potential exit is, get near the front of the order book and can manage my positions around that ‘frame’.
Quantity and quality
I’ll trade somewhere around 1000 events a week, on average, this year and that means I don’t need much per race to get a stupendous result on the year.
I just need to pick up something from most races, and that will do. If you have that mindset then you will end up with a more balanced approach to things. Over the course of a day, week month and year individual results will vary but if you focus on the long term goal it will help keep your primordial urges in check.
When I see a good opportunity I’ll take it, but most of the time I’m just biding my time waiting for it and trying to not get into trouble.
Yesterday I didn’t feel that I got the best out of the day. The races were not lining up quite correctly and I didn’t think I did a great job of them. I did OK, but others did better; so I know there was more on the table. However, it was still a good average per race, which is key.
Knowing that you are aiming for something realistic, means that even if you have a bad result you can forget it quickly, move on and not let it influence what you do next. On the opposing side, if you get a good trade, I tend to look at it as though it’s funding a few losers or slightly bumping up my average.
A level head will give you a much more realistic objective and that in itself will stop your behavioural biases from interfering with your trading.
But the overall objective is similar, little and often soon adds up!
The post Betfair trading – Little and often soon adds up appeared first on Betfair trading blog | Expert advice from Professional Betfair trade.