Longterm Scalping

I really can't tell, but there's a forumite on here who will know and his forum name is Feck N. Eejit.   
  He is very helpful with these things and normally responds if one start a new thread with the heading "Calling Feck"

Very droll Eddie.

You are almost certainly just dodging a bullet in that sooner or later you won't trade out of a position and you will wipe out your bank or BF will go down and do the job for you.

Hello there.

I did some quick calculations and calculted that your profit is £524 or £262 per month. I assume because of the volume of markets that you specialise in horse racing.

There is a problem with your question "In the long run, based on these figures will I be profitable?" Apart from the fact that your question really answers itself in that as your figures are profitable if you base future calculations on them then they will also be profitable, it's who the quesion is directed at and who would answer.

Anyone who hasn't tried this approach probably hasn't tried it because they don't think it will work. So they will tell you such, however they know less about it than you do.

Anyone who has tried it and failed will tell you that it doesn't work.

Anyone who has tried it and succeeded will not tell you anything or will lie because they don't more people copying their strategy.

But i may as well have a go at answering this question since you haven't had many other responses. If your selection criteria involves some level of skill or judgment then it is possible you could be successful. If you are just picking completely random events and doing it with no level of skill or consideration then any profit you will make will be fairly minimal any probably something that is best used to help avoid the premium charge. I have not induldged in this strategy myself.

If you have another account with another company it solves the problem of what happens if Betfair goes down. Oh and it is possible that if Betfair goes down and you have a large position you could actually win the bet. I'm sure that it happened to someone once....

Hi U.A

Thank you for that answer, it is appreciated. I am just trading pre-race horse racing markets. How did you calculate the profit figure? That figure is better than what I have actually made but its not too far off. Maths isn't my strong point at all!

If your selection criteria involves some level of skill or judgment then it is possible you could be successful

At the moment, I only trade the fav/2nd fav only. I really don't know if I have the skill or judgemet to say which way the market will go definitely. However, I only enter the market if I am confident that it will move the way I think it will, and if it does, I take my 1 tick. If it doesn't I trade out for a loss. The main thing I have tried to do is accept losses and never to go inplay to chase a tick. Its only after a year, or maybe longer that I will find out if I have what it takes or not. Also, my trading rules or "system" is written down and I follow it to the letter. I think this has helped a great deal.

As far as Betfair going down, it is a big concern. All my bets are take SP if not cancelled, I do have other betting accounts and so far I have been ok, but I suppose this is the biggest risk for me as there is only so much you can do in a the last few minutes before inplay.

Sample big enough that I'd say it's not chance and your system does work.

FYI, IMO stop losses are a mugs game on financial markets and a mugs game here.

Yes there will be times if BF goes down that your bet wins, but there are times when it won't. There may also be times when BF goes down that you don't know if you were matched or not.  What do you do then.  Look this is a small risk but you have to be aware of what the worst case scenario is, especially if you are trading like this with a large proportion or all of your bank.

2 other points:

1. Looks like you are only making small money per race.  No doubt this adds up to say £200-£500 per month if you are successful, but you have to consider is that worthwhile as 35 markets per day is a lot of effort.  You may consider you are winning well and it is time to up your stakes but than in itself can have two effects.  Firstly you may behave differently with larger sums at risk.  Secondly upping your stakes may affect the market.  Scalping for £10 stakes is a lot different to £100 and £1000 stakes.

2.  If you are just looking at the prices and nothing else when scalping then in my view it is very unlikely you would be successful long term, or at least not successful enough to make it worth your while.  I'm sure some people do make it pay purely by trading the numbers, but I feel those who are more likely to be successful would be the ones who are a bit more aware as to why the horse is drifting/shortening.

But good luck and if you do report back in say a year it would be interesting to find out how things went.

Hello mtymoney.

My calculation was just done by multiplying 56 days by 35 markets to get your total markets. Then multiplying that total by .67 and .33 to get your total winners and total losers and then multiplying the winners total by 1.7 and the losers total by 2.64 and subtracting the latter from the former.

Interestingly it takes longer to type out what i actually did than the actual doing of it.

Based on your 1 tick winning margin of £1.70 then i would estimate that you are backing first for around £100 and then laying off. This in itself is not too bad if the site goes down as you are limited to £100 loss which will not kill you given your profit of £200+ a month.

The problem may come if you are laying first and then backing which means that you are more likely to have a bigger exposure (no innuendo intended here) if the site crashes. Or if you have matched on multiple markets and the site goes down for a long time. As TheVis indicates it would be in that instance very useful to keep an eye on your positions so you have an idea of what has been matched. If you genuinely have no idea if you've matched or not then i would guess the best bet is to half trade out elsewhere and hope for the best.

There is always some kind of chance of things going wrong whatever you do really as well as things going right and being lucky. Glad to hear that you are trading based on some kind of thought of what the prices should be and what way the prices should go. That is some kind of skill level which could give you the chance you need and also something that you may find improves the more you do it (if you have just recently started).

By the way no-one knows what way the market will definately go (unless they've got a bet on at an obvious wrong price). I don't know where you heard that from but if you've got that impression from forum postings then well........

Hi

Thank you for the comments and advice it is appreciated.

Firstly you may behave differently with larger sums at risk

I would estimate that you are backing first for around £100 and then laying off


Depending on the stake, a tick loss can look so much bigger, and can play with your mind. At the moment, as my bank has increased slowly, so too has my stakes. Everytime the bank reaches a new high, I recalculate my 5% stake. When I started I was staking on £25, now I am staking slighlty more. I believe that this has been a good way to start as I gradually get to play with a slighlty higher stake, and so dont seem to be pay too much attention to my increased loss or profit figure with a tick profit or 3 tick loss. In addition, as the average odds of all my trades so far is 3.90, I don't expose too much of my bank on most trades. I dont really have a preference for laying or backing first at all. It just depends on the price and what way I believe the price will go in the next few seconds or so.

If you are just looking at the prices and nothing else when scalping then in my view it is very unlikely you would be successful long term, or at least not successful enough to make it worth your while.

I do agree with you that those who have done more research or take a longer term view may be more successful in terms of the returns they get for their initial outlay. However, I don't really know the ins and outs of betting on a horse, form, trainers, gallops reports, sires etc. Due to this, I dont think I'd make a good trader that would be able price up a horse to see if its value or not, and then trade the price based on that. Also, with a family and work as well, I wouldn't simply have enough time. At the moment, I have the time to trade the races and scalping the last 10 minutes suits me.

FYI, IMO stop losses are a mugs game on financial markets and a mugs game here

I'm quite interested in your view on this. Why do you feel stop losses are a mugs game? I just think that if I take a price, and it doesn't go my way, then there should be a point where I cut my losses and start again. I'm sure there are traders that manipulate this with large sums of money to scare people like me, but I would have thought that if you are trading a price then there must be a point where you stop your losses.

The thing is you're only scapling for one tick profit, yet will take a loss over 3 ticks.

Over time this method probably won't pay off as you'll trade out of a lot of good trades too early, whereas you let losing trades ride out to 3 ticks.

Maybe you should be more confident and aim for a 2 or 3 tick scalp each time.

Depends where your edge is, but there is only so much you Can put into the markets particularly hours before racing where all the value is.  Trading is great for bank building but when you get so far there are more produktive ways to use the money.

Hello there mtymoney.

How do you cut your losses. There is an impression that you have a 3 tick stop loss, but given that your average profit is £1.70 for 1 tick, then if your average loss is £2.64 you are trading your losses out at about 1.5 ticks. This means you are taking a large number of losses before your stop loss kicks in.

Also how do you get your average profit of £1.70 with average odds of around 3.9 if you are only trading slightly more than £25. My definition of slightly more than £25 is anything up to £40 (and that is being a bit generous) but you would need to be trading at about £130 to get this average profit. I think i must be missing something here.

Anyway with regards to stop losses i don't think they are for mugs i think it is a very subjective thing and depends upon the individual. If you look at pxb i would say that he is extremely disciplined and so has no need for them and he would rely on his knowledge of which way he thought the market was going to go for trading out.

If you take TheVis's comment of "You are almost certainly just dodging a bullet in that sooner or later you won't trade out of a position and you will wipe out your bank" then here a stop loss is invaluable as it negates any kind of indiscipline which some people may have concerning trading out at a loss.

It may well not be the most effective method but 1 thing stop losses can do is to take some of the stress out of seeing a loss get bigger and bigger, especially if you are a nervous trader.

Hi

My stop loss is between 1 - 3 ticks. It just depends on what price I can get matched if things start to go wrong. Sometimes, I will try to scalp out and take a loss anywhere between 1 - 3 ticks. I normally try to put in my opposing bet at 1 tick better prices in  the hope it gets filled, if not then once it reaches my maximum loss of 3 ticks I close my position. Sometimes, I do have to take even bigger losses in terms of ticks but so far that has been quite rare.

When I started I was staking £25 whether it was an opening lay bet or back bet. However, as the bank has grown so has my stakes. At the moment, I am staking just short of £50. Im not sure if my maths is incorrect or not, but the average profit and loss figure is from my BettingPandL sheet, and my average odds of 3.90 is from the Betting History sheet. (I used Excel Avg. Sum calculation to tell me). I don't know if the fact that my stakes have grown has skewed the avg. profit and loss figure or not.

Also, when you say you are trading your losses out at about 1.5 ticks. This means you are taking a large number of losses before your stop loss kicks in. is this a good or not? Im sorry if this sounds a bit naive.

Hello there mtymoney I think that it is a good thing as again it seems to be another level of skill and subjectivity that you are trying to employ. The biggest question is whether the effort and the time you have to employ is worth the benefits you get out as it? Hopefully the answer is yes but only you can answer that one.