Martin Blakey Trading Betting Exchanges
Yes, trading is normally associated with the financial markets, but with the new betting phenomenon of betting exchanges, we can now trade sports.
In this article, Martin focuses specifically on horse racing.
Basically, trading is backing a horse at one price, and laying off at a shorter price to take a guaranteed profit on the race, regardless of the result. Ideally, it is always best to try and trade before the race actually starts, but to do this you need to know if a horse is going to attract support in the market which will force its price to contract, and not everyone is privy to this sort of information.
I do trade a lot in running and want to show you the criterion I use that has proved very successful, but does require patience and discipline if you are to make a success of it.
1. When trading in running, I only use 5 furlong, 6 furlong and seven furlong races. These races tend to be fast and furious and prices do change rapidly, which is not always the case with longer races which can tend to be muddling affairs until the last couple of furlongs.
2. I watch the live on course market (using www.sportinglife.co.uk/racing/live shows) and concentrate on the first three in the live betting. It is important that the price on Betfair does not differ too much to the on course price. If a horse is priced up at 4-1 on course, I would want it to be no bigger than around 5.2 on Betfair. You will often see horses at almost double the price on Betfair to what they are on course, and this is usually a strong sign that the horse will not be winning, and therefore the chances of making a successful trade are greatly reduced.
3. I look for a horse that is heavily supported on course without any drift at all, such as shown in the example below. Often you will see a horse well backed, but then drift back out and these are ones to avoid from a trading point of view.
4. Do not use races such as maidens, where the majority of the horses are having their first racecourse experience. It is always best to concentrate on races where the majority of runners have solid form and experience behind them.
5. Do not use races with more than 12 runners. Ideally, races with between 7 to 10 runners are what I like to concentrate on as there is much less chance of meeting with interference and trouble in running.
Race example
21/04/10. Catterick 3.10. 7 furlongs
Sixties Icon. 9-2 4 7-2 10-3 3
You can see that “Sixties Icon” was backed into 3-1 from an opening 9-2 without any drift in price at all. What I would do here is back Sixties Icon at 4.0 (3-1) and look to lay off in running at around 3.0 (2-1). What tends to happen here is punters expect a big run from the horse because of the huge weight of money behind it on course, and therefore it will often shorten quite quickly allowing a trade to take place. In this race “Sixties Icon” actually won so there was never any doubt, however I have had many occasions when I have traded out for a profit when the horse did not even finish in the first three.
Example.
I have used stakes of £100 to keep it simple.
You back Sixties Icon at 4.0 to a stake of £100. You then put an in running lay up for £133.33 at 3.0. If the horse hits this price in running, you will make a guaranteed profit of £33.33 regardless of the result. (Editor’s Note – Betfair offer a KEEP BETS facility enabling you to place your lay bet prior to the race actually going off. You don’t need to follow this race therefore or be in attendance when it goes in running as the Keep Bets facility will place your bet automatically as soon as the race goes in running)
You can, of course, take a smaller profit. It is entirely up to each individual as to what level of profit you want to take, and what size stakes to use.
I use www.betcalc.com/backlaycalc.php to work out the calculations, you just input the stake and price you have backed at, then the price you want to lay at. Once you have done this, press the calculate button and that will tell you exactly how much you need to lay at to take a profit. [Editor’s note – as with Tony Gibson’s article, if you want a more professional approach from your dutching, Fairbot from www.binteko.com will do all of the necessary calculations for you from a trading perspective.]
Pre-race checks
Well before the race I always check the first three or four horses at the head of the betting for the following:
Is the yard in form? (I do not want to be attempting to trade on a horse that comes from a stable that is out of form). You can check stable form at www.racingpost.com by clicking on the trainer’s name in the racecard.
Does the horse like to be held up or race up with the pace? I always try to look for a horse that likes to race at the front, or at least up with the pace. (This can be checked by looking at the analysis of previous races run by the horse – look for details regarding how the horse has been run, e.g. up with the pace.)
If the horse has been well backed and likes to race up with the pace, it will shorten quite quickly in running, allowing a quick trade to take place.
Look for horses that have good recent form and are generally consistent performers.
Only consider those horses that are heavily backed on course, for example if “Sixties Icon” had the following price movements, I would have left it alone.
Sixties Icon. 9-2 4-1 9-2 4-1 7-2 10-3 7-2 4-1
Figures like the above show that the market is undecided about the horse, so this is one to avoid as the market information is very weak, suggesting that the horse is not really that well fancied. Horses do win that drift, but we want to be trading on horses that are well backed, as this will trigger plenty of activity in running as players are expecting it to win and will be eager to snap up prices, especially if it is in a prominent position.
Once you have located a horse you want to trade on, you back the horse on Betfair and then do the calculation to see how much you need to stake on the lay to take the required profit. You then input the required stake and price in the lay section, and as soon as the market goes in play, you press the “Place Bets” tab at the bottom of the screen. You are now trading in running, and providing the horse hits the price or lower than you have set, you will be successful. There will be times when something goes wrong in the race and the horse will never hit the required price, however, providing you follow strict criteria as described, you will have plenty of success, and I have had runs as high as 38 successful in running trades using this method.
Trading should not be attempted unless you are an experienced player on Betfair, it can be very lucrative, but also has its pitfalls like any form of betting. You must do your homework on all the horses that you are expecting to trade on, check the form and likely pace angles of each horse you trade on, and if you have any doubts at all, leave the race alone and wait for the next opportunity. Only give this a go when you are 100% confident of your ability, and are fully up to speed with the Betfair format. Bespoke software will really offer you an extreme advantage.