|
By:
Oh you can multitask.
That's good to hear. |
|
By:
Am I always such an @rseh0le ?
You bet I am. |
|
By:
Thanks jt. I was messing about with some other figures earlier e.g. 4 @ 25.0 (true 20.0) split over 4 accounts and that was disappointing (only 1.5% saved). TBH I can't believe I'm wasting my time on this sh1te. The fact it's so complex only goes to prove how out of touch with reality betfair are. As I said on another thread, if betfair had started sky then instead of sky+hd boxes we'd have one of Del Boy's Russian video recorders with instructions in Chinese.
|
|
By:
Perhaps it deliberately meant to be complex, as more simplistic solutions do not model out satisfactorily.
Or would that perhaps be attributing far too many " smarts" to the BF executives ? |
|
By:
FINE AS FROG HAIR
pls. get off these threads - your snide comments add nothing. They were OK for a while but just annoying now. All the best with your gambling - move on please |
|
By:
Feck,
It's a topic that interests me so I'm grateful for the opportunity to test my understanding of the PC and my arithmetic. Getafix, My calculations referred purely to the example posted by Feck. I haven't yet compared the effect of different rates of commission, margin and strike rate but I'm sure that you're correct on that. My sign-off comments about Ferengi were just a joke (relating to Feck's often stated views on traders and the bf interface etc). |
|
By:
I knew what you meant really jt45 :-). I suppose I just feel sorry for some of the traders as from what I have read, this change has put some of them out of "business" at the blink of an eye, or will do in future. Which in all honesty I fear will eventually apply to all of us.
|
|
By:
Getafix
How can you go out of business if a charge to gross profits is less than 100% ? As for all this churning analysis isn't all just simply a case that if you employ a sideline non-core strategy that breaks evens after commission, then your charges to GP ratio will increase, and you will then have less PC deducted from your bottom line net profit, which thus should increase ?. |
|
By:
* Which in all honesty I fear will eventually apply to all of us.
Especially considering the fact that no group of individual betting types are discerned for with new PC. I would have thought Betfair would have preferred to keep the market makers, old fashioned bettors on side as they provide most liquidity imo... (probably wrong thread to air this on lol). My major concern for betfair is, myself and others who are value takers will place equal bets in *all* available exchanges - we have nothing to lose. If they get matched elsewhere we don't pay pc on the match. So we will end up seeding other exchanges (very little extra work once implemented). I am sure other will disagree with me, but traders etc require us value players in order to work!? I feel saddened by the whole situation, I am happy to pay the extra - but in the real world who pays extra when there are possible alternatives that could be cheaper? |
|
By:
RAPS
Maybe I'm just trying sometimes to bring all this stuff down to a level of practical usefulness and interest to the average punter ?. It does all tend to get up itself at times. However I'll try more to model myself on your constructive posts. OK ? Also all the best in your gambling too. |
|
By:
FAFH - the main point is "churning" is too risky. I will work on diversifying portfolio (as I have in the past) and look at increasing profits in different sports. It just won't work for non "value" based stategies, so price traders are screwed!
|
|
By:
> How can you go out of business if a charge to gross profits is less than 100% ?
I won't currently but what is lurking around the corner? |
|
By:
I disagree.
I have old strategies that made very low profits on high turnover. As a manual trader I discarded them as having too low reward /time ratio, not because of any loss potential. Now with the PC I have become less lazy and have reactivated them, to the benefit of all that is both BF and other punters looking for trades. And I'm only ever a pre-off position punter. |
|
By:
FAFH >As for all this churning analysis isn't all just simply a case that if you employ a sideline non-core strategy that breaks evens after commission, then your charges to GP ratio will increase, and you will then have less PC deducted from your bottom line net profit, which thus should increase ?.
churning is simple too risky. Winning strategies are hard enough to come across never mind "break even" strategies. Especially when you have to consider affects of losing runs that persist (longer than a week)! Whether they work into the future also. I disagree. I have old strategies that made very low profits on high turnover. As a manual trader I discarded them as having too low reward /time ratio, not because of any loss potential. Now with the PC I have become less lazy and have reactivated them, to the benefit of all that is both BF and other punters looking for trades. And I'm only ever a pre-off position punter. Are you one of the 480 then? You talk like it is easy? |
|
By:
*churning is simply too risky.
|
|
By:
No unfortunately not a member of the super elite.
Took me over 3 years to even learn how to win consistently. My non core strategy is not seemingly risky at all. They're not easy to find, but they're there. |
|
By:
I'm sure they are out there, otherwise I would own betfair lol.
One has to objectively decide out of all the options what is the least risky. Churning is at the bottom of my list, I can think of many better alternatives in the short term - which I fear will be BF's undoing! |
|
By:
As I said earlier we all basically have our own self interests at heart.
And mine is for BF to stay healthy and to keep offering me the opportunities to bet in the manner I do, which opportunities do not exist for me anywhere else, currently at least. |
|
By:
Don't get me wrong I love betfair and everything it has done for me over the years, fortunately for me, I am not as affected as others (at this point in time) but will still have to cough up the 40%. I just hope for a fairer environment for the masses for the future, it has suddenly got much more difficult for the "beginner" player especially if "churning" is what everyone will be doing. The smaller players will have less value to obtain so more difficult to prosper against the already 2% players.
|
|
By:
I just want it to survive.
Not for the sake of others, just for the sake of me. Value is always relative. That I'm never worried about finding, even up against the pros. As long as the overrounds don't get too ridiculous, I can prosper. |
|
By:
Also... read Betfair's annual reports, Betfair are not struggling by any stretch of the imagination - sure they have invested in some bad eggs - as with most companies, but the idea that the new PC payers are substituting the cost of marketing for new players is incorrect... read it for yourself. It's all public domain.
|
|
By:
I know enough about reading company reports to know that it's what is NOT in them that really matters and is of true interest.
|
|
By:
I know enough about reading company reports to know that it's what is NOT in them that really matters and is of true interest.
Maybe you can instill us your wisdom? I am all ears. |
|
By:
*us with
|
|
By:
Well if I knew what wasn't in them, then I would tell you ( if that makes any sense ).
But we all know how even perfectly normal standard accounting practices can often mislead more than they inform. The point being really Getafix, that in all the mumerous postings on here, I never read anything that truly factually pins down the nuts and bolts of the detailed costings, revenues, cash flows etc etc of setting up, running and growing a sports exchange. If you think you know all this from reading the company accounts then you are far more skilled in such matters than I am. I've been out of the business world for quite a long time now, and would be the first to admit that my balance sheet/income statement/cash flow analytical skills have seriously eroded over time and they probably weren't all that good in the first place. I always found it to be a real chore ever to have to focus on such matters tbh. |
|
By:
So in fact I could reverse it all on you, and say that I am all ears.
|
|
By:
FINE AS FROG HAIR
Date Joined: 12 Mar 07 Add contact | Send message When: 20 Jul 11 22:40 Joined: Date Joined: 12 Mar 07 | Topic/replies: 3,463 | Blogger: FINE AS FROG HAIR's blog Getafix How can you go out of business if a charge to gross profits is less than 100% ? Well I can answer that, for 2011, 'the pie' looks like this for me: GP is split as: Betfair 30% Other expenses 26% With 44% left to 're-invest'. So there is a limit where Betfair's share of GP and other expenses that are not tied to GP can exceed 100% of... GP. |
|
By:
FAFH: I did some research and posted this a few days back:
By: Getafix Date Joined: 13 Jul 10 Add contact When: 18 Jul 11 14:23 Just had a look through the annual reports to try and finally see what is really happening... 1) http://corporate.betfair.com/investor-relations/~/media/Files/B/Betfair/Annual%20Reports/betfair-annual-review-2009.pdf 2) http://corporate.betfair.com/~/media/Files/B/Betfair/press-releases/2011/2011-06-29.pdf? Here is a summary of Net P&L (millions): *2011 : 35.1 *2010 : 22.7 2009 : 34.6 2008 : 32.6 2007 : 22.8 2006 : 29.2 2005 : 16.8 *Also I quote the 2010 and 2011 the "underlying" figures which "Underlying figures are stated after making a number of adjustments in order to aid comparability between periods. These adjustments involve the exclusion, where relevant, of: the revenue and EBITDA from the High rollers segment; exceptional items; equity settled share-based payments; profit on sale of financial asset; and the associated tax effect of these adjustments. A reconciliation of reported figures to underlying figures is set out in Appendix 1" the "reported" figures are: 2011 : 23.0 2010 : 15.1 so to my *untrained* financial mind and considering 2005 - 2009 are "reported " figures(?), this suggests it is the listing on the stock market ("Exceptional items") that the main loss in revenue in 2010 and 2011 was caused by (looking at page 31 in document 2 link above)? Maybe someone can confirm? This to me implies that Betfair are not struggling - that the debate regarding not enough money from new clients etc is not true... They just want to squeeze out more profit which I can understand any business would do if able. I do not want to spread conjecture and would like to be proved wrong, but it seems pretty clear to me from the above? Please someone prove the above wrong... esp you FAFH, you sound like you have more detailed knowledge of how to read these reports. |
|
By:
Sorry Investor I don't understand your last post.
My post to which you are apparently responding to, was in relation to traders being charged PC up to max of a 60% of total charges to GP ratio. Thus as long as this is less than 100%, how can they be put out of business by it ? |
|
By:
Getafix
In essence you have to be able to reduce everything to real cash inflows/outflows ( both actual and projected). That is publicly reported earnings figures per se are not all that indicative of the true operating cash flow status of the company. Now if somebody more skilled, or perhaps more motivated, than me can do all that and present a precise cash flow statement on here , then I would really love to read it. And if proves unconditionally that BF is generating more than enough cash revenues from its current nonpremium PC pricing structure to run and grow the business satisfactorily, then I will do a very gracious mea culpa. |
|
By:
FINE AS FROG HAIR
Date Joined: 12 Mar 07 Add contact | Send message When: 21 Jul 11 03:13 Joined: Date Joined: 12 Mar 07 | Topic/replies: 3,465 | Blogger: FINE AS FROG HAIR's blog Sorry Investor I don't understand your last post. My post to which you are apparently responding to, was in relation to traders being charged PC up to max of a 60% of total charges to GP ratio. Thus as long as this is less than 100%, how can they be put out of business by it ? Because there are other expenses involved for us. In my own case: internet, backup internet, satellite, software, hardware and most importantly opportunity cost. I'm putting a lot of time and money into this, and if my profit was reduced to let's say £2k per month, it would just be silly to continue. I might still be able to continue betting, but if so it would entail diversifying away from Betfair. Look at a company like betting promotion operating on here. Their non trading costs operating expenses are about £500k per quarter. Assuming they'll now be on 40% (maybe they have a special deal), that means they need a GP of about 833k to cover operating expenses. So if they make £700k GP, and Betfair take their "40%", they will be left with £420k net betting profit. However, after operating expenses, they will be left with -£80k and this pattern would see them go bust where previously they would have survived. It's quite extreme, but as Betfair increases charges, these kind of scenarios will become increasingly likely. Smaller players like myself will obviously have tiny 'operating expenses' by comparison, but they will also have smaller profits to offset them. If you can't cut costs or increase profits the game's up. |
|
By:
Froggy. Take somebody making 25k per year trading, generating around 5% commission. They have been doing this for 10 years. Now, they have to pay ~55% of their profits to BF. Their "income" will have gone from 25k to 11,250. Not sure if you think that is being put out of business or not. What about 50k per year? Now they will make 22,500....
There is a limit on your stakes, you can't simply double them and make double the profit. The market is affected, your value gone. This doesn't just affect the "elite", this will put a lot of people that have plodded along for many years trying to make some coin, to now be told that their time has been wasted and to go out and get a job. Wonder if they will give a reference. |
|
By:
Both the last two points make fair enough points as regards the impact of PC on the bottom line profitability of betting for a living using BF.
But that is not BF's real corporate responsibility or concern is it ? Their concern is to ensure that the exchange they're running remains viable from their own bottom line perspective, not their customers' perspectives. Now that sounds very brutal , but it is the real world of business. They are not intrinsically in the business of making their customers either rich or even self supporting or able to feed their families, or whatever other emotional string you want to pull.. They are in the business of providing a betting platform for any and all who wish ( voluntarily) to use it, that's all. For sure if BF has no customers then its basic business of providing a platform will fold, which in essence is saying that if their prices are too high nobody will but their product, which is exactly the same as in any other non gambling type business. But they have no inherent responsibility to keep their prices either low, or even competitive, except to the extent that they want to stay in business. And part of that wish or need to stay in business, is the requirement for them to keep attracting new betting monies into the exchange to replace those being taken out by highly successful punters. Note that these monies are not even necessarily being taken out of BF's "greedy" pockets, they are being taken out the pockets of "mug" punters. BF has to find more and more " mug" money day in day out to keep the platform alive. The extremely successful punters themselves are sure as hell not going to out and about soliciting for new BF clients, except by a bit of word of mouth to their " sucker " friends perhaps. |
|
By:
"--- if their prices are too high nobody will buy their product----"
|
|
By:
And to pre-empt certain types of inevitable replies, I of course don't like this reality any more than anybody else does.
I would just love things to go along as they have done in the past. Would suit me just fine and dandy. But in the world where I made my money, that sort of dream run always comes to an end. Some of you seem to think not only does BF owe you some sort of a living, but also BF would not be here today without you. Don't flatter yourselves. |
|
By:
But they do have responsibility to their profitable customers, at is those who are providing the liquidity for the "mugs" that you are suggesting they are trying to attract. Getting bets matched is all people want, without the ability to do that, they will go elsewhere. Apart from that, the profitable punters are generally smarter (at least in regards to gambling), and as such won't simply accept things if there is an alternative. So while they don't have any responsibility to keep people profitable, they are certainly not increasing their revenue if they are driving certain people away. They are a broker, the more bets that get placed, the more money they make. Get rid of people providing most of their liquidity and they lose the money they create for BF.
As for seeding their own markets, that at least will not be happening in Aus. If they want to be a bookie here, they have to seperate that from the exchange. They are a broker and a broker only, so any liquidity that is moved from profitable punters certainly can't be created by BF. |
|
By:
Some of you seem to think not only does BF owe you some sort of a living, but also BF would not be here today without you.
i see the pr is starting to get a little more agressive/obnoxious on here.....pr meltdown before weeks out i'm guessing...! |
|
By:
A childish and puerile reply which will no doubt be typical from many on here.
I don't mind the good debaters on here who argue strongly and persuasively that BF is not making good or wise business decisions on the PC matter. I just totally detest the argument that BF is not making some sort of fair business decision, mostly based on total personal interpretations of what is or isn't fair. What they really mean of course is fair to them individually, though they never honestly admit that. They dress it all up in some dream type collective fairness to all punters, expert and/ or mug. What place fairness has in the cut throat world of gambling for a living is totally beyond my comprehension, let alone what place it has in the business world in general. Honesty yes, but fairness ? What utopian business world does that play a primary role in ? |
|
By:
To iz of course.
BJT Your reply and point of view I respect and appreciate. |
|
By:
I just totally detest the argument that BF is not making some sort of fair business decision
share price crashing down 58% in a year; where did you buy in froggy? |