Higher rate premium charge

[rik]

When I went on the highest rate, I initially threw a hissy fit, but then started to work out how to move as quickly as possible from 60% to 40%. So I did the above and also started some long term value betting. That allowed me to move quickly from the top rate down to the 'lowest' top rate. But as it was effectively retrospective for me, I've got no chance of getting lower. It's just impossible. But that was ultimately the aim of the charge from Befair's perspective.

What do you mean by no chance of getting lower? Lower than 40%?
The way I see it anyone generating less than 40% will be having to pay the difference in premium charge sooner or later wether they fell into it back when it was introduced in 2010 or later, doesnt make a difference?
If you generate more than 40% you dont have to pay thats all it comes down to.

[Euler]

Betfair should have introduced it on all activities going forward. Instead, they made it on your lifetime profits, of which mine was substantial after 11 years in the market.

My commission paid % was under 5% when it was introduced, so I would have to make up over 35% on all my profits prior to its introduction. Which is more or less impossible.

[deestar]

What do you mean by no chance of getting lower? Lower than 40%?
The way I see it anyone generating less than 40% will be having to pay the difference in premium charge sooner or later wether they fell into it back when it was introduced in 2010 or later, doesnt make a difference?
If you generate more than 40% you dont have to pay thats all it comes down to.

Yes but as Betfair top you up as if you've always been paying 40% when you first hit it, there is no point generating 40% up until the point you reach the requirement to pay it i.e £250k net profit.

In a perfect world you'd generate as little as possible until you hit PC1, then maintain 20% until you hit PC2, then 40%..... Obviously it is not a perfect world.

[ShaunWhite]

Ok 2% is the plan to be on

It only affects UK stuff, if you ever get round to looking at Ausralian racing (depending on clock changes & sleeping habits etc) then you'll be paying anything from 6 to 10% anyway. The slight concession Betfair make is that your reward points earned by paying commission anywhere earn you a discount on the Aus commission rates (but not on the UK rates). It's small, you probably don't need that info, but it's on topic and all knowledge is good imo even if it isn't useful

[rik]

Betfair should have introduced it on all activities going forward. Instead, they made it on your lifetime profits, of which mine was substantial after 11 years in the market.

My commission paid % was under 5% when it was introduced, so I would have to make up over 35% on all my profits prior to its introduction. Which is more or less impossible.

Not really? Section „other charges“ makes up the difference to 40% anyway so going forward it doesnt matter if your 40% baseline is made up of actual paid commission or other charges.
If from now on you are generating > 40% you wont pay a cent regardless if your overall generated is 11% or 40

[Consty1]

During the last Q&A somebody asked about a PC yearly allowance and Betfair suggested it was something they would look at now that their PC avoidance detection had been improved (or something along those lines going off memory). Not holding my breath.

[ShaunWhite]

"The tenure piece ....

"tenure piece" I see business-speak bs is still live and kicking. Can someone who works in an office confirm if they mean "incentive"?

[jamesedwards]

Betfair have this silly thing called 'commission generated' which basically calculates your contribution as 3% commission flat.

If you stay at 2%, then Betfair roll that up to 3%, but at 8% you would only benefit by 3% of your contribution. So don't do that!

My understanding is that the 'commission generated' calculation is:

(gross profit from winning markets * (commission rate% / 2)
+
(gross loss from losing markets * 1.5%)

Have I got this wrong?

[deestar]

[/quote]

My understanding is that the 'commission generated' calculation is:

(gross profit from winning markets * (commission rate% / 2)
+
(gross loss from losing markets * 1.5%)

Have I got this wrong?
[/quote]

No but I find its expressed easier as follows:

Commission Generated = (Commission % + Implied Commission)/2
Commission % = actual commission paid on winning markets
Implied Commission = 3% on losing markets

[deestar]

Betfair should have introduced it on all activities going forward. Instead, they made it on your lifetime profits, of which mine was substantial after 11 years in the market.

My commission paid % was under 5% when it was introduced, so I would have to make up over 35% on all my profits prior to its introduction. Which is more or less impossible.

Not really? Section „other charges“ makes up the difference to 40% anyway so going forward it doesnt matter if your 40% baseline is made up of actual paid commission or other charges.
If from now on you are generating > 40% you wont pay a cent regardless if your overall generated is 11% or 40

Not exactly. Because at PC2 they calculate your base rate before Other Changes. So if your base is less than 5% you pay 60%, between 5-10, 50% and only over 10% do you pay the 40%.

[rik]

Betfair should have introduced it on all activities going forward. Instead, they made it on your lifetime profits, of which mine was substantial after 11 years in the market.

My commission paid % was under 5% when it was introduced, so I would have to make up over 35% on all my profits prior to its introduction. Which is more or less impossible.

Not really? Section „other charges“ makes up the difference to 40% anyway so going forward it doesnt matter if your 40% baseline is made up of actual paid commission or other charges.
If from now on you are generating > 40% you wont pay a cent regardless if your overall generated is 11% or 40

Not exactly. Because at PC2 they calculate your base rate before Other Changes. So if your base is less than 5% you pay 60%, between 5-10, 50% and only over 10% do you pay the 40%.

I said it doesnt matter if your overall generated is 11 or 40% didnt I, noone sane would stay below 10% generated anyway.
My point was Peter saying you have to make up 35% difference from 11 years of previous betting to avoid premium charge which I dont think is true, you simply have to generate more than 40% going forward otherwise youll pay the difference to 40.
Im on 26% overall generated and had periods of dropping out as „other charges“ would bump my percentage to 41 or 42.
You cant really expext Betfair to say you got 250k allowance from the day of premium charge was introduced, and the premise wouldnt change anyway, you still would have to generate more than 40% going forward it doesnt make a difference.

[jamesedwards]

Not really? Section „other charges“ makes up the difference to 40% anyway so going forward it doesnt matter if your 40% baseline is made up of actual paid commission or other charges.
If from now on you are generating > 40% you wont pay a cent regardless if your overall generated is 11% or 40

Not exactly. Because at PC2 they calculate your base rate before Other Changes. So if your base is less than 5% you pay 60%, between 5-10, 50% and only over 10% do you pay the 40%.

I said it doesnt matter if your overall generated is 11 or 40% didnt I, noone sane would stay below 10% generated anyway.
My point was Peter saying you have to make up 35% difference from 11 years of previous betting to avoid premium charge which I dont think is true, you simply have to generate more than 40% going forward otherwise youll pay the difference to 40.
Im on 26% overall generated and had periods of dropping out as „other charges“ would bump my percentage to 41 or 42.
You cant really expext Betfair to say you got 250k allowance from the day of premium charge was introduced, and the premise wouldnt change anyway, you still would have to generate more than 40% going forward it doesnt make a difference.

Depends on your trading style. Some trading styles naturally generate a high lifetime com% and avoiding PC is relatively easy. But if your main trading is a successful scalping automation, as just one example, then you would expect almost all markets to be profitable and therefore your lifetime com% would be very low and you would have to pay almost all the relevant Premium Charge every week. I imagine Peter did a lot of scalping in his youth!

[The Silk Run]

I'm rather confused what all the discussion on here about Premium Charge is. I thought all the Professionals simply arbitrage their transactions, or am I missing something !!!

[Bog]

I'm rather confused what all the discussion on here about Premium Charge is. I thought all the Professionals simply arbitrage their transactions, or am I missing something !!!

Sounds easy in theory, but... How do yo do that? In what markets?

[rik]

Cant control which side is winning with arbing, pay double if Betfair side wins