Increasing deposit limits - Trading as income source

[Acheron]

It's a tangent but I took a closer look after Shaun's example and found the following.

To double a 1k bank in 4 mos you'd need to make >0.8% net profit a day (>25% monthly return). Not unrealistic (the "£100 into £120" before threw me a bit) and I think most traders would be delighted with that performance as it would lead well into 6 figures by the end of the second year (after fee). However, if instead you end up making say 0.5% profit per day (which is more in line with my estimates), you're reaching <25k in the same time period. In that case a £500 monthly contribution would boost your growth close to the 100k mark.

The good news I think is that, while lower profit margins can significantly dampen prospects with a small bank, there's only around a 1-year "delay" in the above example for achieving a living wage level. And if you manage to increase your deposit limit after getting that far (I'm assuming that's how BF look at it) then you can always boost going forward for that 1M

It's all very speculative of course, just sharing for curiosity's sake. (You can use any compounding calculator, I used this one following a post in another thread.)

[ShaunWhite]

You can't just compound it because your stake affects the market, otherwise everyone with an edge would be on 100k. And they're not. I was just talking about how you can get to a couple of thou in the bank and staking in 100s. On that you can make a decent living wage, but no phone calls to the Ferrari dealership.

Unless you've got a few years under your belt then I doubt a fee months of profit would sway your deposit limit, and tbh why deposit? Just try and make decent money for 6 months and take it from there.

[Acheron]

I think the talk of 100k's and 1M's has clouded things a bit here - my apologies. My concern was simply that my estimates project a growth rate that is lower than I'd like, strictly with regards to that living wage level (no Ferraris!)

So those dreamy numbers never entered my mind as any sort of personal expectation, and I'm aware of the difficulties that higher staking poses. I was only trying to illustrate the impact a monthly contribution can make at the lower end, which I think can be a valid consideration in cases like mine.

While 25k a couple of years in would certainly count as a win, it's clear that small variations can have big implications for bank growth. Therefore, if you're confident enough in your edge and able to raise your deposit limit then why wouldn't you make those deposits if you so wished?

Just try and make decent money for 6 months and take it from there.

That looks like my only option anyway, and yes I'll gladly take it.

[ShaunWhite]

It's not just about bank size. Profit is stake * edge * number of bets. Being better more often is the long term goal because markets are stake limitted. You can use the same tenner a thousand times a day if you wanted to.

I'm not saying don't deposit, but once you find a decent edge your bank will grow about as fast as your ability to handle the increasing stakes. Make some small steady money first, then worry about loading up.

[LeTiss]

People who's main source of income is from BF tend not to deposit and just leave enough working capital in place. The reason being that errors can happen, and an inadvertent ban/restriction on deposits means you're out of work. Also self employed (which a full-timer is) traders don't usually shuffle money between personal and business accounts otherwise it looks like like your money is spread thinly.

Great post, as per usual Shaun.

You're spot on. I've been self-employed since 2008 and currently have a £100 deposit limit that was recently introduced. I didn't bother disputing it, because I didn't want to trigger any invasive financial checks, and tbh I never deposit anything anyway (that's probably why they set the deposit bar so low) - I have a decent BF bank, but this is my income, my business, so my BF bank is my working capital. I have withdrawn sizeable chunks though and BF have never questioned the withdrawal or wanted proof of earnings, because all that money was generated by my activity, not by deposits that I later use as a part-withdrawal

[Acheron]

Thanks again Shaun for your valuable input, I'd say we're pretty much agreed.

You're spot on. I've been self-employed since 2008 and currently have a £100 deposit limit that was recently introduced. I didn't bother disputing it, because I didn't want to trigger any invasive financial checks, and tbh I never deposit anything anyway (that's probably why they set the deposit bar so low) - I have a decent BF bank, but this is my income, my business, so my BF bank is my working capital. I have withdrawn sizeable chunks though and BF have never questioned the withdrawal or wanted proof of earnings, because all that money was generated by my activity, not by deposits that I later use as a part-withdrawal

Also, perhaps they weren't bothered about imposing a tight limit because a sizable bank renders the issue low priority for them, as a challenge is less likely.

I've been reading up on the many dreadful experiences with account closures etc and, yes, one flag seems to be withdrawing what you deposit rather than what you win.

[ShaunWhite]

Also, perhaps they weren't bothered about imposing a tight limit because a sizable bank renders the issue low priority, as a challenge is less likely.

I've been reading up on the many dreadful experiences with account closures etc and, yes, one flag seems to be withdrawing what you deposit rather than what you win.

The size of your bank won't have much to do with your deposit limit. It's just low by default. Like LeTiss I think mine is a hundred quid or something. They certainty don't look at your balance and think you've got 'enough' so only give you a low limit, or the opposite.

The issue with proving income will swing to being the other way round. It's not convincing Betfair that you're able to deposit, it's the difficultly proving that Betfair is income if you need credit elsewhere. Even if you show years of steady profit, banks won't assume that will continue, and when it comes to HMRC records then you're basically unemployed with zero income. If you think you'll need a mortage, loans or credit agreements like phone purchase contracts, then you might struggle. Specialist mortgage brokers exist but it's usually for people at a high level.

There's a lot of things that contribute to the 'problem' betting software algo, mid-session deposits (unplanned betting), escalating stakes (chasing losses), frequently pulling money out then putting it in again (robbing Peter to pay Paul), big changes to what you do eg switching from trading to just betting (discipline, clear strategy) or a change to your normal hours/duration amongst others. No one thing will sound the alarm, it's about patterns of behavior. Eg if you deposit frequently mid session and Martingale stake, then take every penny out then you don't exactly look like you know what you're doing.

[Acheron]

I didn't know the limit was so low by default. I had assumed that by "self-employed" LeTiss was referring to his trading ("my income, my business") and that BF might just auto-apply a low limit in the absence of a payslip.

There's a lot of things that contribute to the 'problem' betting software algo, mid-session deposits (unplanned betting), escalating stakes (chasing losses), frequently pulling money out then putting it in again (robbing Peter to pay Paul), big changes to what you do eg switching from trading to just betting (discipline, clear strategy) or a change to your normal hours/duration amongst others. No one thing will sound the alarm, it's about patterns of behavior. Eg if you deposit frequently mid session and Martingale stake, then take every penny out then you don't exactly look like you know what you're doing.

Yes I'd gathered as much. Bettors certainly face a sorry situation having to safeguard against such an indiscriminate, non-transparent and devastating set of policies, thanks to the industry-wide legislation.

[jamesedwards]

£100 pm seems to be the arbitrary limit that they now set for people who have reached initial deposit/loss limits but have failed or refused to go through the proof of income process.

[Acheron]

£100 pm seems to be the arbitrary limit that they now set for people who have reached initial deposit/loss limits but have failed or refused to go through the proof of income process.

Ah, that would make sense.