What ROI is possible?

Over 200 bets you might (though unlikely) get 30% , you might get -30%,  but 200 Bets is absolutely nothing.

You need to do at least 1000* before you start to see your true ROI, by which i mean what you can consistently expect to return with the same strategy/system/approach to betting.

Though this varies dependent on average odds. If you are backing or laying very big or small odds then the results of 200 bets could be very misleading .

Though i would say you are living in a dreamworld if you think 30% is acheivable long term.

5-6% would be brilliant.

5-6%? you can get that with a bank. I'm sure over 30% is poss if you know what you're doing. Any premium charge payers want to disclose their ROI?

Ashley you're very young.

5-6%? you can get that with a bank

But if you want to live off it you will need about £250,000 Capital in the bank though.

5-6% of a few hundred k total stakes over a year could give you enough to live on, without ever risking more than 3% of your bank, on Capital of £3,000 , if you get get 250 bets a month on. Even if you could only get 80 or so bets on per month you could do it with £10,000 or so.

So it's not a good comparison Ashley.

I don't believe anyone can return 30% on top of their stakes over thousands of bets. If you were backing at Evens you would need a 65% strike rate!

Talking bets way above evens mainly.

Maybe I'm misunderstanding ROI or how it works. We'll use 30% as an example. say over 200 bets you loose a total of 1k however you win in total 1,300. This is a profit of 300 or 30%. I understand this to be ROI - maybe I'm wrong?

If you staked a total of £1,000 and returned £1,300 .Yeah, that would be 30% ROI .

If you are talking about somewhat over Evens, say average 3/1 ,£5 per bet, then you would need to get 65 winners with 135 losers to return £1,300.

So thats a 32.5% strike rate on 3/1s !  You cannot reasonably expect to do that .

If your ROI is that high you're probably missing too many opportunities anyway.

Is it possible to get a huge ROI way above say 30% or am I living in a dream land?

Depends what you mean? It's often confused. As a percentage gain over a year yes it's possible, as a percentage gain of weekly stake, no way.

Best thing you can do is to suck it and see, "make the right picks at the right prices" as you say, but be prepared for disappointment, so if you're new to this use tiny stakes for the first month, then reassess.

I don't bother with calculating my ROI anymore, but I know it averages in the region of 3-4% after comm (so 1000 waged would return 30/40 weekly), which would work out to about 150-200% increase in bank over 12 months (1000 bank would return 1500/2000 profit).

I prefer the figure that was discussed in another thread, profit as a percentage of max drawdown (profit to risk ratio) and that's around 1000% per year for my methods, max drawdown being roughly equal to 1 months profit, so very low risk.

First of all, Tobermoy, how can you find 300 bets on monthly basis?? Only if you know everything about at least ten sports and I doubt there is person like that

bubusan10

I would average over 200 bets per month and that's only betting on horse racing, Saturday's only and only on 1 meet.

Trev, Ashley in his 22:34 post agrees with my definition of ROI (Investment = total of stakes/liabilties, Return = total of what you get back after each event) so i think he is overly optimistic to say the least. I know some people see it as increase in Bank; so if a deposit of £1,000 on here is built up to £1,300 then that is a 30% ROI . I can't see the sense of that myself, as it is not going to be sustainable , and more useful to have a figure that consistently tells you how well you are doing over time.

Bubasan, i think there would certainly be enough opportunities in Horse Racing and maybe  Football and Tennis too, so it could be done in 1 sport. If the 5% edge someone has is based on identifying a flaw in a particular market, particulary horse racing , then knowledge/research of the sport would not be required and it could be applied systematicaly on every race, of which there are a lot more than 300 a month.

But anyway you only require 300 bets a month as i was saying above , if you have a £3,000 bank with a 5% edge. A £10,000 Bank would only need 1/3 the number of bets. And you could use the 3K to build up to £10K (with 85 or so bets per month) if you did not withdraw anything for 18 months.

If you had  £30,000 then it would be easy for anyone with a pricing edge of 5% on the market to make a living, only needing to find about 50 bets a month:

Bank	% of bank per bet		Stake per bet	Bets per month		Total Stakes per month	Total Returns per month		ROI	Mpnthly Profit
£30,000	2%		£600	50		£30,000	£31,500		5%	£1,500

£1,500 a Month would be fine for me .Someone with a mortgage and a family would need more, someone in a bedsit/living with parents would be fine with less.

Well, I don't have a clue about horse races but as I realize so far, you can trade that heavily so that is fine lets say.

Regarding ROI, I'm much more familiar with second of your thoughts (e.g. in some portfolio management or investment fund industry that change of value in some given period is called change of NAV - net asset value) and i find it much more valuable over some long period. Compare this with financial markets and you will find little bit silly to count ROI for every your paper or position.
For some time I made parallel statistic with both of this numbers and in the end NAV = few times multiplied ROI, no meter of positive or negative balance.
With continuous ROI of 10% on monthly basis with your 300 bets you would millionaire very soon, try to put it on paper for period of ONLY 10 years and you will see that 10% is very high and reachable just for small bunch of bettors/gamblers. Also, with huge volumes and increased size of your bets you will need less and less ROI to earn great money...

bubasan10

My averages of over 200 bets per month from 4 meetings are not trades, purely position bets on perceived value.

Investment can surely be easily defined as the theoretical amount you need to have in your BF account at any moment in time to make the wagers you are contemplating doing.
In other words it is the sum of the net liabilities of your wagers currently outstanding and not settled.
I do this daily on all the bets I am making. Thus I can come up with a daily capital requirement.
It's pretty simple then to calculate ROI, once you have established your capital requirements.

Wow, that's one messed up way of inventing yet another useless stat.

I can think of nothing more utterly pointless than a daily return on investment figure with the possible exception of "Return on capital"

Gambling is about the amount won, not the percentages.

It's not scalable, so the percentages are meaningless drivel. (Most of the time)

Lori
Gambling is as much about managing risk as taking a risk.
If you don't know what your liabilities are , how do yo even start to manage them.
Of course I'm saying black, and you axiomatically are going to say white. Or yellow in your case.

Kelly manages my risk for me, that's what it's for. I've been through this with you too many times to count, it's O-level maths stuff that you refuse to grasp

Not at all.
I understand Kelly as much as you do.
It's not what I'm talking about at all.
For starters, surely your decision whether to use full or fractional Kelly is a function of the amount of your capital you wish to risk.
It's called nor overbetting is its most simplistic form.
All I'm saying is that if you don't keep close track of your total liabilities at any moment in time, you risk overbetting.
It's not really just only a question of how much you bet on each wager, but also how many wagers you are making simultaneously. Total liability or exposure is a very important factor in any intelligent risk mgt of any portfolio, be it of shares in companies or wagers on sports events.

It;s called not overbetting----

t's not really just only a question of how much you bet on each wager, but also how many wagers you are making simultaneously.

Kelly stops you from overbetting.

I'd always assumed that you used Kelly in share trading too. It's possible that there is too much guesswork in city stuff to estimate your edge properly but in gambling you can do so. If you're not sure of your edge, you should use a minimum edge to get around the overbetting thing. It's not rocket science.

Don't be ridiculous.
Kelly is only as good as your ability to quantify your edge.
And in sports betting that very iffy in the best of gamblers.
And you're certainly not one of them.

The ability to quantify your edge is what gambling is about. If you can't quantify it all your fancy daily return on turnover per scrambled egg portfolio gibberish isn't of any use anyway as you're probably betting with a negative expectation!

Not every counterparty you bet with on here is a rank amateur.
They presumably think they also have an edge in taking on your wager.
What makes you think that you're always the one who's got it right.
Bit conceited if you do think that way.

All I'm saying is that if you don't keep close track of your total liabilities at any moment in time, you risk overbetting.

Well obviously you have to keep track of how many bets you have at any time for Kelly too. That's why if you have ten 10% shots running simultaneously you only bet 65.1% of your roll.

As usual, you state something as if to refute a point, but actually just agree with the point you're trying to refute.

Please note that I can only pass comment on the utility of the ROI% figure in relation to level stakes betting on the horses.

It's not much use at all.

A few long odds winners will distort the ROI% figure. A better method, imho, is to calculate the Variable Stake returns over a series of bets, (stake to return 1pt; e.g. stake 0.33pts at odds of 4.00, stake 1pt at odds of 2.00, etc).

The table below , simplistic and hypothetical I admit, demonstrates this clearly. 

ROI at level stakes 120%, a 6.82% loss at variable stakes.

Dec Odds	Result	LS returns			VS returns
4.00	LOST	-1			-0.33
6.00	LOST	-1			-0.20
5.50	LOST	-1			-0.22
3.50	LOST	-1			-0.40
10.00	WON	9			1.00
4.50	LOST	-1			-0.29
7.00	LOST	-1			-0.17
12.00	WON	11			1.00
5.00	LOST	-1			-0.25
4.30	LOST	-1			-0.30

Bit conceited if you do think that way.

Luckily I don't really care if it's conceited or not to be correct.

There's a guy I regularly tussle with on a couple of markets. His model is nearly identical to mine with a few subtle differences. If his stakes weren't so small I'd suspect it was Bayes. It still might be. I mention that only because you know that I think he's better at this than I am.

However, that doesn't impact the edge my model has (as long as there are no systematic ways to exploit it, which I keep a close eye on), so I can proceed as is, even if one of the players in that market is getting a small edge on me individually.

I don't believe the ROI is important, and at times is impossible
to calculate for anyone making more than one bet in any one market.
The important thing is whether you are showing a profit is it not ?
I go to the races with, say £1000 in my pocket. I may make 1,2, maybe
3 bets in 4 or 5 races, and perhaps come out with £1200. I've won
£200 and I won't be working out my ROI but thinking about my losing
bets and perhaps learning from them. That is more important to me.

and if you could go with £2000 and come out with £2300 your ROI would be lower, but you'd be happier.

The Investor posts his ROI from time to time, I seem to remember it's diminishing rapidly as he gets better.

What's my ROI if I have 3 bets in one race, say 150/100 Horse A,
100/7 Horse B, and 200/28 Horse C.
Total Stake 135, Returns 250, 107, 228 or 0 ?

Result	Returns	P/L	ROI%
If A wins	250	115	85.19%
If B wins	107	-28	-20.74%
If C wins	228	93	68.89%

If neither A, B or C win then.............

Which sport is that on Lori ?

I believe he does mainly soccer.

Same theory applies everywhere though, the more efficient you get and the bigger your bankroll, the more you'll look for marginal opportunites and lower your ROI

Sorry I was replying to this:

By: Lori
Date Joined: 20 Apr 04 Add contact | Send message When: 23 Jan 11 09:57 Bit conceited if you do think that way.

Luckily I don't really care if it's conceited or not to be correct.

There's a guy I regularly tussle with on a couple of markets. His model is nearly identical to mine with a few subtle differences. If his stakes weren't so small I'd suspect it was Bayes. It still might be. I mention that only because you know that I think he's better at this than I am.

However, that doesn't impact the edge my model has (as long as there are no systematic ways to exploit it, which I keep a close eye on), so I can proceed as is, even if one of the players in that market is getting a small edge on me individually.

200 bets or 200 markets ?

Ah, for once in my life I'd rather not say Rocket.

I can understand that

If his stakes weren't so small I'd suspect it was Bayes

Even if it was Bayes, I doubt he'd own up to it.

He never posts on forums.

Yeah, it wasn't meant as a call out, he should be as cagey as me on the issue, it was an example to let Froggy know that it wasn't part of my conceitedness (or however you spell that ) on this occasion as he knows I think Bayes is awesome.

I agree that with those who say that ROI it's not so relevant, for me "NAV" that I mentioned earlier is far better profit measure. First of all it eliminates first of psychological barriers for most gamblers, run for ROI instead run for profit that has to be declared in advance. In that way you will also avoid factor of greed that always singing in your head "just this one more - it is great opportunity..". No; that's enough, you made what you planned. That doesn't mean you wont put bet after you reach your goal, but should keep you from what you call over-betting. I had never hear that term before but I would compare it with psychological definition of overconfidence (wikipedia: Optimism bias and Behavioral economics).

The next thing why I think this is good is because while you have plan that satisfies your aspirations, you don't need to search and guess with something that is unpredictable but just to pick what is obvious or like people like to call here "free money". I would call it (as I think Lori said before) achievement in serious betting portfolio because small ROI would bring you more money and then you realize you made your betting easier and easier. At least in my mind-frame...

P.S. I think it is useful for everyone who tend to be serious bettor to read about cognitive biases as I wrote up, because you will find your self in lot of "simptoms". Most interesting is that people are conscious about that but still they cant cope against it.

Who is bayes, some betting made millionaire? :)

Ashley_Young
Date Joined: 06 Jun 10
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When: 22 Jan 11 21:49
5-6%? you can get that with a bank. I'm sure over 30% is poss if you know what you're doing. Any premium charge payers want to disclose their ROI?

Paying PC has nothing to do with a high ROI. Of course 30% is possible. If someone would give me a million quid if I achieved a 30%+ ROI over 1,000 bets, I'd be very confident I could do it. The capacity for such a strategy would be minuscule though. As Lori mentioned, if you're achieving a ROI anywhere close to that, it invariably means you are letting too many 'lesser' opportunities slip. Even if you had very little capital, you'd run out of 30%+ opportunities very quickly after growing your initial bank.

Lori
Date Joined: 20 Apr 04
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When: 23 Jan 11 08:08

I can think of nothing more utterly pointless than a daily return on investment figure with the possible exception of "Return on capital"

Gambling is about the amount won, not the percentages.

It's not scalable, so the percentages are meaningless drivel. (Most of the time)

What do you mean by "it's not scalable"? It's fairly obvious to me that even at this stage, I would make considerably more money if I had a balance that was twice as large (though not twice as much). Also, there are certain people that successfully utilise a seven figure GBP balance on Betfair (perhaps even eight figures, though I don't know of any). It stands to reason that someone with a £10k balance, may have the potential to become a successful seven figure bettor in the future, so his strategies are highly scalable.

I certainly do place a great deal of emphasis on figuring out the optimal amount of capital I can put to use. Currently I need incremental gains in my balance to in turn produce an expected ROCE of at least 25% pa(at the moment it's still considerably higher).

If the returns were lower than this, I would be better off paying off high interest debts. I've often been asked why I don't pay off my debts, that's the reason. Paying off my credit card debt is similar to getting a risk free return of nearly 20%. The fact that I'm choosing not to do so, shows that I am assuming returns from incremental gains in my balance will be considerably better for the time being.

As the balance increases, the ROI and ROCE both go down (if things go well, this will be partially offset by an increase in skill/efficiency etc.)

I read a book called Common Stocks and Uncommon Profits (which is fantastic by the way). It explains how to pick good companies to invest in. What this book is also useful for though is examining your own company, or in this case 'betting project', using the same points. There are checklists for efficiency, accounting etc.

One interesting stat I started examining after reading this was Daily Turnover ratio. The reason this is so interesting is that Daily turnover and Profit on Turnover, don't say anything about how optimally you use your cash. Theoretically someone could have say a 10% ROI, with a £10,000 profit. This may look good, but if they have a £2Million balance, that would be pretty poor. The daily turnover ratio, which is the average daily balance for the period in question, divided by daily turnover, completes the picture.

To become more profitable you need to increase at least one of your balance, ROI or
your daily turnover ratio. An increase in any one of these three, keeping the other two at the same level, will result in higher returns. (of course an increase in balance or turnover ratio will only be useful if your'e already making money!)

Lori,  conceitedness ? I think the word is just 'conceit'.

I dont think you can get anywhere near the percentage returns per market with 7 figure balance as a 5 figure balance. It's clear you can make more money... much more.... but the percentages have to drop.

There just isn't the liquidity or stupidity out there to maintain a double figure ROI per bet over a huge balance, imo of course.

Of course I agree with that. By 'scalable' I mean that increasing your capital is worthwhile, not that the % returns stay the same with a higher balance.

Ok.

My point was meant to be that ROI is meaningless (at least without context) because it's pretty easy to get an ROI of 1000% if your balance is 2 quid and you sit around for months trap betting, but pretty bloomin' difficult to get 1% if you have 5 million constantly in play.

Certainly I agree with the rest of your post about increasing one of those three things, but concentrating on increasing ROI is basically a dead loss compared to trying to increase one of the other two.

Personally I'm always looking for more ways to get all my marbles in play (No lost your marbles jokes please), so have to agree with you on that.

In funds mgt. ROI is the only thing that matters.
After all it is essentially the measure on which fund mgrs. work out their remuneration levels.
However in the world of sports gambling, where you are effectively putting your own money where your mouth is, there's a strong common sense argument that all that matters is how much you've increased your BF account balance at the end of any period you're interested in or looking at.

If a gambler could easily get 2.5 million on a darts score being 5 sets to 3, or a cricket team scoring over 325 runs, then ROI would become a much more fun measure.

The trouble is you'd be lucky to get 200 quid on the former or 2000 on the latter.

As I understand it on the markets, and I know very little about how shares etc work, you can basically bet what you like whenever you like, at least up to levels barely heard of on here making ROI a far more meaningful concept.

It was always a good measure in poker tournaments. Someone with a 42% ROI in $10 single table tourneys and a large sample, was better at that format than someone with a 15% ROI as you were comparing like with like.

That's the other problem on here, someone betting big on premiership soccer and getting a 1% ROI is probably doing pretty good business compared to someone who makes a bigger ROI on side markets taking people's fun tenners.

FINE AS FROG HAIR     


However in the world of sports gambling, where you are effectively putting your own money where your mouth is, there's a strong common sense argument that all that matters is how much you've increased your BF account balance at the end of any period you're interested in or looking at.

Absolutely spot on.

ROI can warn of overtrading.

If you are using £100k to make 0.2% ROI, with a daily turnover ratio of 0.5 and at a later stage you are using £200k to make 0.1% ROI with a daily turnover ratio of 0.5, you can either find a way to increase the turnover ratio, or if this is not possible, decrease your bank and put the money to use elsewhere.

I agree that deliberately trying to increase ROI is pointless as it will already be at the optimal level if you take care of everything else.

Picture a triangle shaped stack of buckets. Each is a bucket of value with a single bucket at the top resting on two buckets etc. The top bucket represents the best value, so it is the first you will want to fill using one of the canisters you have avaiable. When the bucket is full (you have reached capacity), you go on to the next two buckets, and so on until all the buckets are full. When they are full, adding more capital becomes pointless (a bit like pouring from canister to canister without creating value), and can even be detrimental to returns. As your skills increase, you will also discover that there are more buckets to fill than there were initially.

As you are naturally going to pick the very best opportunities available (the highest bucket in the triangle) relative to your capital base, your ROI will be optimal (or at least as good as it can be in relation to your strategy/skill).

I totally agree with this one from FROG:
However in the world of sports gambling, where you are effectively putting your own money where your mouth is, there's a strong common sense argument that all that matters is how much you've increased your BF account balance at the end of any period you're interested in or looking at.

As more and more money I earn my ROI is getting lower. And my change of NAV in relative also. But absolute numbers are bigger and bigger and thats the only thing I'm looking for. Most of you trade horse races and I believe there is high liquidity on that markets but if you have money management you don't involve more then 20-30% in the same time I suppose; and I'm not talking about some super big portfolios here.

@ investor: The reason this is so interesting is that Daily turnover and Profit on Turnover, don't say anything about how optimally you use your cash. Theoretically someone could have say a 10% ROI, with a £10,000 profit. This may look good, but if they have a £2Million balance, that would be pretty poor.

I don't know what your strategies are but I don't understand why to keep more then 100k on account, even 50k. Of course that your ROI will be lower as you don't turn your complete money around but then you can pull it out and invest in something else, e.g. stocks, mutual funds etc.

bubasan10m it has to do with capacity. Obviously your strategies aren't suited to using large sums. Some people are putting 7 figure GBP balances to good use on here, let alone 100k.

You have to ask the questions like What's better:
Making £20k a year from a £10k balance.
Making £30k a year from a £30k balance.
And so on.

First, definitions.

Many decades back I learned that Profit%/sales (NP%) X Sales%/Capital = ROC% (Return on Capital or ROI IInvestment).

Most people on here confuse ROI (Investment) with NP% on sales(stakes). Theoretically, it is possible to take your bank as equalling capital but I have never found it at all relevent to gambling.

In theory, the higher one's NP%/Stakes the less volatile the results. With straight betting it is possible to achieve high % especially with a very selective approach.I have myself achieved 50% on stakes across a year betting playing to very high stakes. I doubt if the number of bets amounted to more than 100-150 p.a.

Opinion players will dilute their NP% on stakes by increasing the number of bets. This can lead to higher maximu profits on the one hand but on the other it may lead to greater volatility in returns.

For straight opinion playoing (on horses) I would argue that less is more. You just have to have the nerve to bet large amounts.

There is only one number I am really interested in, and that is net profit. I do use a number of other metrics mainly to compare my activity with previous periods.

For in running trading I look at NP% on stakes (to determine what my average edge is) and %volume of entire market (to establish how often I see an opportunity to open or close a position)

Pre-off position taking I look at actual win vs expected win to determine how good my pricing is.

@ The investor: I don't understand what you wanted to say with 2nd part of your statement. I don't have 7 digit balance but I don't understand what is purpose of keeping that sum of money on account as I can't see what markets have constant liquidity like that so you can turn on all that money at the same time. Just that. Under presumption that you have stop loss exit on your bets/trades.
And it's not so much about my strategies as it is about sports I choose, I don't have any idea about horse races that you all mainly bet on...

In general I agree with Bayes, everybody have strategies according to his state of mind but in the end net profit is all that counts.

And of course the other number I keep my eye on is the one on the Premium Portal page.

Lori: Personally I'm always looking for more ways to get all my marbles in play (No lost your marbles jokes please), so have to agree with you on that.

Talking of which, I like to use the same liability more than once, so sort of having my marbles in play more than once at the same time, as each is a different strategy with it's own edge but using the same bank.

Is it possible to get a huge ROI way above say 30% or am I living in a dream land?

Well, it depends if you mean a total bank increase, or a return per bet. By compounding a small bank into a big one, you can achieve 100s-1000s of % return of your original bank. In 3 weeks I have grown a small bank by 71%, given time and compounding profits it my grow to a large sum indeed.(see my blog on betting to buy my Florida dream home). 

However, remember you are dealing with rather efficient markets which are not usually too far removed from fair odds (in the long run), so I doubt edges beyond 10% are sustainable per bet.

After looking at 2010, I looked at where I made and lost money and, for me the most important factor, where my time has been well spent for the return figure. It became quickly evident that combining my laying and in-running on horses would lead to solid returns for time spent. 

And in this day-and-age of pixel betting, the less time staring at the glowing dots, the better. 

Looking at ROI, it did help me gauge my ability to simply make a play.  Football, for example, I laid around 40 matches a week since the start of the season (25 on Saturdays, 15 during the week).  The ROI was obvious and apparent.  For horses, same thing on laying and was able to see track to track where I was better at making the calls seeing that my ROI on faves was better at AW than taking on 2F's and 3F's under 6/1 at other tracks.  It also shows you where you are wasting your efforts if you see a small percentage return compared to other markets you play.

Strike rate tends to only be an indicator if the market you are playing tends to have a tighter range of odds.  i.e. ICE HOCKEY / REGULAR TIME tends to range on the fave between 7/10 and 5/4.

And taking hockey further, my ROI on bets in regular time is better than the -1.5 market.  So for the balance of the season, I'll focus on regular time rather than the disappointment of a one-goal victory that doesn't pay.

Some have mentioned, at the end of the day it is what is in the account.  A few years ago, I probably would have disagreed but, yes, come the end of a session, you do sit down, look at the start and finish and see how you did. 

From there, I do enter the day into a spread that then calculates my overall gains over a period.  This tends to keep me in check on (again important to me) the amount of time I am spending on the markets since it essentially says what my average percentage gain was and where that will take me in x weeks.


One betfair 'survivors' view

It also shows you where you are wasting your efforts if you see a small percentage return compared to other markets you play.

I will concede that if you break ROI down into small packages like that then it becomes more useful.