How to get funds to scale up

It's the old classic.

System working well, send more money.

Yes, there are other ways.

Some credit cards allow you to do 'balance transfers' to your current account, from where you can deposit without charge, the virgin credit cards allows this for example. You obviously pay for the balance transfer, but often you get 0% for a while so that offsets the cost.

The other option is to shift as much as possible of your spending to credit cards, depositing the money you have 'saved' in this way from your current account.

So my question is this... If you had a system of which you were confident of an edge and needed more money to make the most of it how would you go about getting it?

Let the system make it for you.

You don't need to risk any new money, your betting bank will grow as your system makes money, a snowball effect. Why put in new money and expose yourself to amounts you're not used to in one jump? Far better to grow and learn with the growth, IMO.

You could say the same about a successful growing company. No need to raise funds, just grow organically.

Why bother with credit cards, just get a loan from a financial institution, lower rate of interest, it should be paid into your bank account and then you can just transfer it to BF with no charge.

Is this a viable option?

Trevh
14 Apr 11 01:24 Joined: 21 Jul 06 | Topic/replies: 863 | Blogger: Trevh's blog
So my question is this... If you had a system of which you were confident of an edge and needed more money to make the most of it how would you go about getting it?

Let the system make it for you.

You don't need to risk any new money, your betting bank will grow as your system makes money, a snowball effect. Why put in new money and expose yourself to amounts you're not used to in one jump? Far better to grow and learn with the growth, IMO.

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Best all time piece of advice I've ever seen on here.

Thanks for the replies... even the cynical ones!

People who say let it grow itself are risk averse imo. For example if your ROI is a proven 10% you would be stupid to continue your £2 bets for years on end when you could maximise the potential by increasing as long as the borrowing doesn't eat into the profit too much of course.

A loan could be possible if I'm not truthful about what I want it for but I believe it's hard to get loans at the minute.

I like the idea of a balance transfer or spending on credit card to free up funds. Maybe I'll get another interest free for 12 months on purchases or something to free up my income cash.

Your big problem scrooge in scaling up is how quickly your edge erodes.  The easiest thing on here is to make fancy returns from small bets which you see as low risk.  Start increasing the stakes and eventually you will affect the market and/or others will take note of what you are doing and capitalise themselves.

Then there is the mental aspect.  If you are grinding along with small stakes which you don't mind losing that is fine.  Start upping the stakes and mentally it becomes more challenging plus you may soon change your behaviour eg trading out sooner than you would have done therefore making less profit.

Overall scaling up may not be as easy as it seems.

2 points, you bank is growing so increase your bets accordingly, and deposit an additional amount.

It's never possible to say that ROI is a proven' 10%.

First, while the selections of a system or bettor may have recorded 10% in the past, there is no guarantee they will do so in the future or that the system-finder hasn't been guilty of a bit of unconscious back-fitting.

Second, the statement can only ever be true of a certain stake size. If it returns 10% at 20GBP, it may only return 2% at 200GBP.

The answer is either to bet to Kelly fractions and watch yr bank accumulate or to use more of your bank, eliminate as much of the variance as poss. and trade. I wd incline to the second course if yr events are available for significant amounts of money IR.

Some people can turn £1k into £10k in a couple of months on here. Others can turn £1k into £1.5k in a couple of months.
If the second person's strategy is highly scalable, so that he could also turn £10k into £15k in a couple of months, borrowing can make sense versus growing organically.

The biggest advantage of letting your funds grow organically is that you learn to deal with the larger amounts, and you are protected against losses. It's always possible that earlier wins were due to luck, and that you start losing when betting bigger, for this or other reasons.

I did the same thing scrooge_mcduck is considering throughout 2008/09. I withdrew nothing, but instead kept adding money to my balance. I borrowed at zero percent, intending to repay when the deal ran out. When it did run out, I didn't repay because I was compounding my profits much faster than even credit card interest.

At the end of 2009 I started making regular withdrawals, and I have paid down a large chunk of the debt. People often don't understand how it can make sense to have debt if you are making money. They also often don't understand how it's possible to have deposited much more than you have withdrawn, as another successful bettor said to me 'unless you are using your account as a bank account'.

The fact is that there are people around who can successfully use £millions on Betfair. To the guy who can make £100k+ a year from a £10k or £20k bank, borrowing will never make sense. To someone who can make £100k a year from a £200k bank, and £190k a year from a £400k bank, it may do.

Scrooge, you say in line 1 that you even with small stakes, you are only winning small percentages.

Any increase in stakes is likely to turn that small winning percentage into a losing percentage.

How many times have you asked to back your selection with e.g. &10 @ 2.0, and found yourself matched with £2 @ 2.04, £3 @ 2.02 and £5 @ 2.0?

Double your stakes to £20 and everything extra is matched @2.0, and bang, there goes your small, winning percentage.

It's the reason why the best advice for a punter having a bad run and doubting himself is to rein in his betting; not by having fewer bets, however, but by reducing his stakes.

It's just so very much easier to make a small profit with small stakes than a slightly larger profit with slightly larger stakes.

Thanks for the insight Investor. I'm reassured to hear that this has proved successful and worthwhile for someone else. As you suggest my methods of betting can only return small a small % and so at some point I will need to updscale to make it worthwhile. I'm not fortunate enough to have a market skimming bot that prints money unfortunately!

Askari I understand all the potential problems with upscaling but even by upscaling my bets won't be 'that' large so shouldn't even come across any of those problems.

Of course any ROI isn't guaranteed no matter how mcuh past data has been trialed but I was saying that 10% for example over lots of past data may be worth the risk of borrowing. You have got me thinking that maybe I don't need as much money as I thought though and will think about using a bigger proportion of my bank so thanks! Originally I wanted to keep bets at 1% but if I lost anywhere near half my bank the edge would most likely cease to exist now!

Scrooge, you say in line 1 that you even with small stakes, you are only winning small percentages.

Any increase in stakes is likely to turn that small winning percentage into a losing percentage.

Again I can see how this can be a problem but my upsacling isn't as grand as you are prob imagining more like increasing bets from £20 to £200 so still should be doable. Won't make me rich but will hopefully give me some worthwhile returns.

Well, if you've found an edge in a market with so many players and so much liquidity that it can absorb ten times as much money without any worsening of the odds at which you get matched, then very well done.

Just remember, to get £20 matched at a value price, you probably only need to find one mug to match your offer, and often improve on it. Now you are going to have find ten mugs.

Still, I realize this must sound like sour grapes, and I genuinely wish you all the best.

Scrooge are you an in-running player or a pre-match/pre-race player or a combo of both?

Thanks Screaming, I personally think a lot of the time it's possible to profit from prices that most would deem fair if your selections are good enough.

I am a pre-match/pre-race player mainly. I do generally do even better inrunning but am happy with smaller consistent returns and can't bet inrunning as much as I'd like because I work.

Anyone who says you can't make money betting pre-match football or any sport is kidding themselves. For a start those people are clearly overstaking if 3 or 4 losers sets them back to the beginning again.

Yes, the prices on the whole are very accurate, they are bound to be. But they are not perfect and you don't have to bet on every match! Saying it's not possible also excludes anyone being lucky... are we saying that winning the lottery or a 100-1 accumulator coming in isn't possible too? I'd say there's a lot better chance of consistently profiting from pre-match prices!

I think I must be about as cold blooded a gambler as they come and I've made a lot of money in this game so I know very well that it can be done, but the idea of encouraging ANYONE to borrow money to bet on here fills me with horror and consternation.

Whilst it may be prudent for companies to borrow in order to build their businesses I don't think the same can ever be said of gamblers no matter how good they are, or THINK they are. Quite simply - a proven pro gambler doesn't need to borrow money, he already has it. You prove your methods by winning money so if you don't have a bank then you haven't proven your strategy. There may be one or two people who manage to make it work but they will be extremely rare exceptions.

If your strategy can't scale itself then it doesn't work.

If you can't wait for your money to build up naturally then you don't have the patience and discipline to make it.

By borrowing money rather than building it up naturally you are admitting that your margins are extremely tight,you'd be much better off working on your strategy to improve it than trying to short-cut the process by an absurd risk.

Banks won't lend to gamblers and they're right not to. They know that in almost every case the money goes down the drain, with no dis-respect to the OP - that's far and away the most likely outcome in this scenario as in all the others.

Borrowing money to gamble with is pure idiocy and should never be considered. That way lies ruin.
For Chr1st's sake Scrooge - don't do it.

Hello there Scrooge. When people say that you can't make money betting pre-match football what they are really saying is "I can't make it, and because I can't make it then no-one can because I am too arrogant to admit that there are people who are better than me at doing this".

I wonder if these people also believe that it is impossible to run the 100m in under 10 seconds (assuming it's not Usain Bolt who is saying the above).

Anyway as valid as Aye's point is it is probably the case that you have already decided that your course of action is to borrow money because you know you can do it.

Assuming you have (if not then think of what Aye said) all i would say is before you do, make sure that if you were to lose that money for whatever reason (even if it were someone hacking into your account and losing it for you)you wouldn't be completely screwed. In short make sure you only borrow what you can afford to lose.

Good luck with whatever you do.

Thanks for the advice Aye Robot. I know that in the most part you are right and I too wouldn't reccomend borrowing to anyone but I believe it can work and has seemingly been proved by investor.

You're fortunate (or clever) enough to have a brilliant market making strategy that doesn't need a lot of funds to make good returns but what if you only had a 10% roi strategy and it needed big money to get decent returns. I appreciate what you are saying about tight margins and I definitely  need to look at the numbers a little more carefully but assume it was scalable, the edge was solid and your discipline sound. Would you consider borrowing then?

Thanks U.A. for your advice too. There are a few great minds on here and I really appreciate your input. I am definitely going to upscale but am going to take small steps towards this by adding more money from my income and other stuff I own before I even contemplate borrowing anything significant. Maybe then the returns will satisfy me. I just really want to make the most of my edge (assuming it holds up) and as I think you know yourself aye robot, things can change pretty quickly round here and the edge can diminish or even vanish very quickly!

but I believe it can work Believing and having proof are different things. Borrowing to bet with is crazy and you shouldn't do it no matter what, you can always build a smaller amount in to bigger money.

Maybe then the returns will satisfy me. This sounds like greed/lack of discipline right off. Certainly a reason to avoid borrowing.

wise words from the investor, imo.

however, i would be wary of borrowing to scale up for 2 reasons.

1) many, probably most, successful strategies don't scale up beyond a certain point and

2) a "proven" ROI may in fact not be. it may not have hit the deal-breaking run yet, or it may be based on an edge that's about to vanish. you often see reports of that happening on here.

so without seeing the detail of what you're doing I'd be inclined to grow organically.