Thanks for your effort James. Much appreciated by myself and I'm sure many others.
John
Newbies Trading in the Dark
Hi, Can all those that posted negative /disagree posts please put up a full explanation of there thoughts,ideas and theories on the same subjects that James has covered,this will give a balanced look for all newbies ,the idea being that all those that criticise /disagree are successful traders in there own right and can explain why they are right and he is wrong,i await with interest full and comprehensive replies from all of the above.
mg
mg
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deanodean1984
- Posts: 30
- Joined: Sat Jun 05, 2010 10:07 am
Im new to trading (about 6 months) and have been making a steady profit despite not knowing anything about horse racing. I started with a very cautious £20 bank and minimum stakes and simply watched the WOM. As my bank steadily went up so did my stakes. My bank currently stands at £502.68 ( after withdrawing £95 today 
) and my maximum stake is £50 depending on odds. I cant trade every day as im a self employed electrician although i wish i could as i simply enjoy the great tug of war that is betfair. I have only have 3 small pieces of advice for fellow newbies:
* Knowing your position in the queue is vital.
* Never be afraid to scratch (i prob do it too much).
* and finaly...there is always another race.
I wish all my fellow newbies the best of luck.
) and my maximum stake is £50 depending on odds. I cant trade every day as im a self employed electrician although i wish i could as i simply enjoy the great tug of war that is betfair. I have only have 3 small pieces of advice for fellow newbies: * Knowing your position in the queue is vital.
* Never be afraid to scratch (i prob do it too much).
* and finaly...there is always another race.
I wish all my fellow newbies the best of luck.
Specially for Mug
………………..............................
. . . .
. ..............3.75 .£100 .
………………..............................
. . . .
. .............3.70 .£120 .
………………..............................
. . . .
. £200 .. 3.65 . .
………………..............................
. . . .
. £150 .. 3.60 . .
………………..............................
Here is a pictorial (above) to explain my previous comments on backing at lay odds and laying at back odds. A "reverse book" is shown below.
Your post stated "You can back at the lay price and lay at the back price and you want to do it at the least possible risk. That's all there is to it"
I replied "I don’t think you are following the crux of my rationale and whilst there is nothing wrong with a reverse book offset strategy, but used at random and in isolation of other qualifying rules for Entry, it is simply not a profitable strategy"
………………..............................
. . . .
. ..............3.75 .£100 .
………………..............................
. . . .
. .............3.70 .£120 .
………………..............................
. . . .
. £200 .. 3.65 . .
………………..............................
. . . .
. £150 .. 3.60 . .
………………..............................
Let me show you why.
Lets say we take your suggestion to Back £50 at the (lay) odds of 3.7. In order for your bet to get matched the odds/sentiment has to be moving OUT (ie from "now odds 3.65" to 3.7) so your bet will not be taken when the pressure is downward (ie heading to 3.6).
If your bet IS taken, then the market is patently moving upwards ie AGAINST your counterpart trade of (Lay) £50 at 3.65. So you are immediately in negative territory.
The ONLY time your theory holds true is if the odds are presently fluctuating between 3.65 and 3.7. The chances of this being true for any length of time (and certainly your ability to hit this moment), by emperical evidence*, is minimal. To be able to repeat it (rescalp) is only possible in very stable and non volatile markets.
*To recognise a fluctuation between 2 fixed odds takes 2-3 iterations (human reaction time). The average number of fluctuations between 2 adjacent odds (over 1000 iterations) is 2.7.
So, unless you are dealing in an almost static market, you cannot make a profit using random reverse offsets.
………………..............................
. . . .
. ..............3.75 .£100 .
………………..............................
. . . .
. .............3.70 .£120 .
………………..............................
. . . .
. £200 .. 3.65 . .
………………..............................
. . . .
. £150 .. 3.60 . .
………………..............................
Here is a pictorial (above) to explain my previous comments on backing at lay odds and laying at back odds. A "reverse book" is shown below.
Your post stated "You can back at the lay price and lay at the back price and you want to do it at the least possible risk. That's all there is to it"
I replied "I don’t think you are following the crux of my rationale and whilst there is nothing wrong with a reverse book offset strategy, but used at random and in isolation of other qualifying rules for Entry, it is simply not a profitable strategy"
………………..............................
. . . .
. ..............3.75 .£100 .
………………..............................
. . . .
. .............3.70 .£120 .
………………..............................
. . . .
. £200 .. 3.65 . .
………………..............................
. . . .
. £150 .. 3.60 . .
………………..............................
Let me show you why.
Lets say we take your suggestion to Back £50 at the (lay) odds of 3.7. In order for your bet to get matched the odds/sentiment has to be moving OUT (ie from "now odds 3.65" to 3.7) so your bet will not be taken when the pressure is downward (ie heading to 3.6).
If your bet IS taken, then the market is patently moving upwards ie AGAINST your counterpart trade of (Lay) £50 at 3.65. So you are immediately in negative territory.
The ONLY time your theory holds true is if the odds are presently fluctuating between 3.65 and 3.7. The chances of this being true for any length of time (and certainly your ability to hit this moment), by emperical evidence*, is minimal. To be able to repeat it (rescalp) is only possible in very stable and non volatile markets.
*To recognise a fluctuation between 2 fixed odds takes 2-3 iterations (human reaction time). The average number of fluctuations between 2 adjacent odds (over 1000 iterations) is 2.7.
So, unless you are dealing in an almost static market, you cannot make a profit using random reverse offsets.
I'm sure newbies will appreciate effort you have put into your posts but I think this isn't as clear cut as you make it.
I spend nearly all my time on a reverse book and the reason is simple. A lot of the time my orders fill anyhow as people back or lay at those central prices. If the price looks like it is going against me and I have been filled on one side but not the other I scratch the trade and start again.
The market does not move up or down on the flip of a coin, it often stays where it is. Even if it doesn't you will often be filled on both orders before it moves. If it does move, you can scratch your order.
I know everybody has different styles but that is how I make the majority of my money. No complicated entry or exit points.
I spend nearly all my time on a reverse book and the reason is simple. A lot of the time my orders fill anyhow as people back or lay at those central prices. If the price looks like it is going against me and I have been filled on one side but not the other I scratch the trade and start again.
The market does not move up or down on the flip of a coin, it often stays where it is. Even if it doesn't you will often be filled on both orders before it moves. If it does move, you can scratch your order.
I know everybody has different styles but that is how I make the majority of my money. No complicated entry or exit points.
In your example, for example.
If I back at the current lay price of 3.70 and that is filled. I get nervous, so I just dumped my lay at the current lay price for net zero and vice versa. Very little risk but if the orders fill then I profit.
Say the price moves before I can get filled I still put in a lay at 3.70 and wait for it to be filled. This takes a little longer so I carry some risk but the net result is still zero.
If I back at the current lay price of 3.70 and that is filled. I get nervous, so I just dumped my lay at the current lay price for net zero and vice versa. Very little risk but if the orders fill then I profit.
Say the price moves before I can get filled I still put in a lay at 3.70 and wait for it to be filled. This takes a little longer so I carry some risk but the net result is still zero.
Thanks for the reply Mug. I do appreciate that the Betfair market can throw up strategies that may seem illogical but ones which some traders make pay. The "hidden" movements in Betfair sometimes cannot even be detected, even at the fastest speeds, so there ARE underlying sub plots going on. Most of my posts are however relate to observable data and using a methodical approach. After all, who would deny newbies the opportunity to learn discipline and patience through adequate planning?
I wouldn't advocate complicated entry/exits in a trading plan and simplest is best but often when a trader reveals his method, newbies need to understand that he is not revealing his whole "edge". I'm sure you make money using reverse book trades, as many others do, but the application of the technique, timing, loss avoidance ie "edge" remains unstated.
Obviously I am not an advocate of the "suck it and see" strategy advocated by many posters, one often finds too many lemons! Personally, my own approach is not the same as "most" traders and I do very little scalping, concentrating my efforts in designing unique approaches that maximise the number of ticks (simply because that is my chosen variable).
Opening peoples minds to possibilities, especially newbies, cannot be a bad thing.
I wouldn't advocate complicated entry/exits in a trading plan and simplest is best but often when a trader reveals his method, newbies need to understand that he is not revealing his whole "edge". I'm sure you make money using reverse book trades, as many others do, but the application of the technique, timing, loss avoidance ie "edge" remains unstated.
Obviously I am not an advocate of the "suck it and see" strategy advocated by many posters, one often finds too many lemons! Personally, my own approach is not the same as "most" traders and I do very little scalping, concentrating my efforts in designing unique approaches that maximise the number of ticks (simply because that is my chosen variable).
Opening peoples minds to possibilities, especially newbies, cannot be a bad thing.
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followthatcamel
- Posts: 73
- Joined: Thu Apr 16, 2009 12:54 am
I have enjoyed reading this thread and thank all for their input. Mot wishing to try and teach anyone how to suck eggs, my own observations on scalping with a reversed book are as follows...
If your initial order or only one side of your orders gets taken and market looks like it will move against you, you can only scratch the trade if there is sufficient money at the scratch price. If not then you cannot fully scratch your trade and although you will be at the front of the queue, you are not G'td to be able to exit.
If market does move against you, then you will only be able to scratch your trade by joining the end of the queue of current money available and getting your order filled. You can of course exit your trade at this time with a one tick loss if there is sufficient money available if you believe the move looks like remaining/continuing.
IMO it all boils down to an individuals judgement of market behaviour and level of risk (number of tick losses)they are prepared to take before exiting.
Less volatile/more stable markets tend to suit scalping more although you can still be successful in a market where price movements are taking place if you can get on the right side at the beginning of a move.
Regards
Doug
If your initial order or only one side of your orders gets taken and market looks like it will move against you, you can only scratch the trade if there is sufficient money at the scratch price. If not then you cannot fully scratch your trade and although you will be at the front of the queue, you are not G'td to be able to exit.
If market does move against you, then you will only be able to scratch your trade by joining the end of the queue of current money available and getting your order filled. You can of course exit your trade at this time with a one tick loss if there is sufficient money available if you believe the move looks like remaining/continuing.
IMO it all boils down to an individuals judgement of market behaviour and level of risk (number of tick losses)they are prepared to take before exiting.
Less volatile/more stable markets tend to suit scalping more although you can still be successful in a market where price movements are taking place if you can get on the right side at the beginning of a move.
Regards
Doug
Hi MG,madgoose wrote:Hi, Can all those that posted negative /disagree posts please put up a full explanation of there thoughts,ideas and theories on the same subjects that James has covered,this will give a balanced look for all newbies ,the idea being that all those that criticise /disagree are successful traders in there own right and can explain why they are right and he is wrong,i await with interest full and comprehensive replies from all of the above.
mg
There are generally 2 types of succesful traders, those who create blogs and tell the world how much money they make and in some cases (very few) give some very good advice, and those like me who make a comfortable living full time from it but wont be buying a Bentley anytime soon.
One thing both types have in common is that they wont be telling you their secrets on how they make their money. I started off with €10 stakes on pre-race horse markets and stuck with those stakes until I was confident that I had a feel for the market and probably more importantly was controlled enough not to over-react to price movements. At the start of this year when meetings were been cancelled all over the place I branched out into the tennis markets and just recently have moved into the football markets. It took me a lot of time and work to create my style and I wont be sharing it anytime soon, point being that its down to hard work and trial and error. If this wasnt the case everybody could buy a book and immediately go and make millions on the stock market!
As mctash proved yesterday with the above quote people will go and read James' posts and think that all his points are common sense (which they are) but I can gaurantee that if you try a strategy based solely on his musings you are doomed to failure. Every succesful trader has started off on small stakes (not always minumum) and worked his way up. For a prime example please see below!mctash wrote:I agree with enzabella2009.
The thread is informative and is miles ahead of the 'get a feel for it with small stakes' methodology. It still requires practice but at least you are targeting your practice not bumbling around using trial and error.
deanodean1984 wrote:Im new to trading (about 6 months) and have been making a steady profit despite not knowing anything about horse racing. I started with a very cautious £20 bank and minimum stakes and simply watched the WOM. As my bank steadily went up so did my stakes. My bank currently stands at £502.68 ( after withdrawing £95 today
* Knowing your position in the queue is vital.
* Never be afraid to scratch (i prob do it too much).
* and finaly...there is always another race.
I wish all my fellow newbies the best of luck.
My main problem with James' posts is not that he is wrong but that 'newbies' may interpret all his points and try to put them into a strategy without doing the legwork. Lets face it most newbies aren't interested in doing the legwork at the start, they're lookimg for the holy grail piece of information or strategy, I was the same when I started out.
Bottom line is that you have to put in the hard work and you WILL lose money to begin with so it makes sense to use minimum or small stakes.
As for reversing the book I don't use it all, not because I don't think it works but because visually it would probably confuse the hell out of me and I don't see any advantage.
My other problem with James is that I don't think he's put in any time trading in the markets at all or at least very little. Take his comment above...James1st wrote:Specially for Mug
If your bet IS taken, then the market is patently moving upwards ie AGAINST your counterpart trade of (Lay) £50 at 3.65. So you are immediately in negative territory.
Because the bet has been taken doesn't mean that the market is moving against you. The price can stay static with lots of money been taken on both sides of the book. No matter how volatile the market is there will always be times when the prices stay static, even if only for a very short period of time. This is where 'scalpers' make their money and on volatile markets this is where the 'swing traders' come into their own. The trick is to combine both of these skills.
I wish you all good luck and to you newbies I only say if you are not prepared to put in the work and lose some money to begin with then trading is definitely not for you.
Hi,
Another thread that's a very interesting read! Disclosure: I've been trying trading for 3-4 months, am still a net loser, still trying, but definitely starting to feel like a dofus.
I can't understand why Peter Webb always seem to win and I always seem to lose
--
I've always been a bit puzzled as to those traders who go around offering others 'advice'. There's obviously a conflict of interest, which to my mind has always made it dubious. I do notice that those people who talk about their success appear to cop some flak, it doesn't seem to go down too well with some. Personally I don't have too much of a problem with someone else's success, but there do seem to be some people that react badly.
---
The thing is, I think that my failure so far is due to the psychological factors rather than lack of brain power. I'm a gambler at heart, too impatient to get the big spectacular wins, and the sporting aspect just doesn't sit with the money making aspect, they are two different mentalities I think. The attention of sport is supporting one particular team, player or horse and cheering it on. This is the exact opposite of the trading mentality, which requires viewing everything objectivity and keeping a cool head. So this psychological contradiction I think is part of the reason that people find sports trading hard.
Another thread that's a very interesting read! Disclosure: I've been trying trading for 3-4 months, am still a net loser, still trying, but definitely starting to feel like a dofus.
I can't understand why Peter Webb always seem to win and I always seem to lose
--
I've always been a bit puzzled as to those traders who go around offering others 'advice'. There's obviously a conflict of interest, which to my mind has always made it dubious. I do notice that those people who talk about their success appear to cop some flak, it doesn't seem to go down too well with some. Personally I don't have too much of a problem with someone else's success, but there do seem to be some people that react badly.
---
The thing is, I think that my failure so far is due to the psychological factors rather than lack of brain power. I'm a gambler at heart, too impatient to get the big spectacular wins, and the sporting aspect just doesn't sit with the money making aspect, they are two different mentalities I think. The attention of sport is supporting one particular team, player or horse and cheering it on. This is the exact opposite of the trading mentality, which requires viewing everything objectivity and keeping a cool head. So this psychological contradiction I think is part of the reason that people find sports trading hard.
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enzabella2009
- Posts: 747
- Joined: Tue Nov 03, 2009 3:58 pm
James1st never claimed any antibetangel sentiment. James1st never advertised a blog. James1st never advertised any particular strategy that would make newbies lose money. He never said reverse book is a MUST NOT. Advicing newbies the correct mental strengh needed to be a trader it can`t be something negative. There must be other reasons why he is getting some negative and unclear comments by rafterp. it`s not true that professionals never share their aknowledge, betangel is a proove of it. I may be missing something here because of my english but I cant see what james1st is doing wrong, honestly.
I agree with enzabella. Trading is made out to be easy, u just back, then lay, and profit. Nothing is mentioned about how much of a mental game it is, and that small flaws or characteristics in ur emotional make up can have a huge effect on your trading. I dont see why someone who is just pointing this fact out for newbie traders is getting so much stick, from people who we have no way of knowing whether they are actually profitable traders or not.