FIXED COMMISSION DEAL (%8) or pay the PC (%20)?

[3virgul14]

Hi fellow punters, traders and geniuses.

Got a million dollar question .

If someone is already in the Premium Charge paying level, and is able to cut a deal for a %8 fixed commission.. Which one would be more logical?

Lets say the person already pays %3 after the commission discounts during the week, and the rest %17 every wednesday morning with the PC robbery.

Or to pay %8 after every winning trade..

?

[Derek27]

For a moment I thought Betfair was offering this deal.

It entirely depends on an individual's profit/loss ratio. Some traders may find they would pay as little a 10-15% commission on gross profit (taking into account losses) and would be better off, whilst other PC payers might find their paying more than 20% on gross profit with a new 8% commission rate - they would be worse off.

[3virgul14]

For a moment I thought Betfair was offering this deal.

It entirely depends on an individual's profit/loss ratio. Some traders may find they would pay as little a 10-15% commission on gross profit (taking into account losses) and would be better off, whilst other PC payers might find their paying more than 20% on gross profit with a new 8% commission rate - they would be worse off.

The question is how to calculate which way you are better off?

Yes , they offer . Or maybe you get yourself into a position to be offered ? I am not sure..

[Euler]

Betfair won't offer you a deal that hurts their overall position, so it probably makes no real difference. Betfair won't offer me a 'deal' of any sort because I am too efficient and win too often. But those with a lower strike rate can be offered deals without affecting headline revenue for Betfair. It's just PC by another means. Just means that the number of people caught by PC is much lower. Betfair will be able to say it only affects 0.01% instead of 0.10%.

Really this is what they should have done originally rather than the blanket PC. Reach agreement with individuals.

[spreadbetting]

I know someone who was able to fix their % comm rate higher with Betfair but there wasn't any deal to have the option of a fixed rate versus PC, the PC calculation still went ahead.

[Derek27]

For a moment I thought Betfair was offering this deal.

It entirely depends on an individual's profit/loss ratio. Some traders may find they would pay as little a 10-15% commission on gross profit (taking into account losses) and would be better off, whilst other PC payers might find their paying more than 20% on gross profit with a new 8% commission rate - they would be worse off.

The question is how to calculate which way you are better off?

Yes , they offer . Or maybe you get yourself into a position to be offered ? I am not sure..

I posted a PC spreadsheet that you might find helpful for calculating PC.

viewtopic.php?p=142786#p142786

To calculate would-be commission just take 8% of your total profitable markets before commission.

[Derek27]

I know someone who was able to fix their % comm rate higher with Betfair but there wasn't any deal to have the option of a fixed rate versus PC, the PC calculation still went ahead.

What was the point ?

Surely that's just offering to pay extra commission with no benefit ?

[spreadbetting]

They were looking for ways to reduce PC and felt their low comm rate wasn't helping so had it fixed at 5%. I'd taken the opposite view to them as any arbing I'd do would be kept within the exchange, so my view was a lower comm rate or at least below 3% was more beneficial.

[Derek27]

They were looking for ways to reduce PC and felt their low comm rate wasn't helping so had it fixed at 5%. I'd taken the opposite view to them as any arbing I'd do would be kept within the exchange, so my view was a lower comm rate or at least below 3% was more beneficial.

Unless I'm missing something that sounds pretty daft to me. They would be paying extra commission and only half of it would count towards reducing PC (implied commission) so they would end up paying more.

[spreadbetting]

The main aim was to move between bands so there was a big benefit to upping commision.

[xitian]

There won’t (shouldn’t) be any difference either way in terms of how much total commission you will pay. The only difference is if you’d rather have paid what’s due every day (every market) or stick to the Wed weekly schedule as a lump sum.

If you choose the base market commission option then they will adjust it periodically so you’ll have paid the same amount as if you had PC. (And presumably monitor it so that you don’t game the system).

I’m happy to stick with Weds PC because I don’t want my base commission changing all the time since my consistency can change quite a lot over the weeks.

The point isn’t to give anyone a “deal”.

[spreadbetting]

The thing is Premium Charges aren't treated as commission, so it's much better to rack up commission rather than charges as they affect your Premium Charge rate if you're a higher rate payer or expect to become one.

A lot of people got caught in the 60% brackets when PC2 came out and had to spend alot of time churning themselves to the 40% rates,, it's much easier to do that with a 5% fixed comm than 2% rate. Plus you never know what's round the corner with Betfair so it's probably wiser to pay any fees due as comms rather than charges if you can.