BlogRead the Latest News

 

My first year of Betfair trading for a living

So, let me take you back two decades ago…

I was still in a ‘normal’ job working in a 9 to 5, but I had this dream of sports trading on Betfair for a living! I’d traded financial markets and prior to that, I’d done a lot of stuff in gambling markets. Here was my chance to combine the two.

In this blog post, I am going to review how I came across the Betfair exchange, opened a Betfair account and created Bet Angel. How it helped me trade and what happened in my very first year as a professional Betfair trader.

Of course, everybody has different experiences and I was trading before people even knew trading existed, so it will probably be a very different experience from yours… take that into account. When I found Betfair, betting exchanges weren’t very well known. Back then you had no Betfair trading software to use and strategies weren’t very well known. If you start trading now, you’re going to be several steps ahead then I was because betting exchanges have evolved and grown to give traders more opportunities and information. Now we have a prolific range of strategies and tactics out there, although some of them I would deeply question! The market is also very competitive now.

However, the experience that you’ll go through, will probably be somewhat similar to the one that I went through. I made the leap from a secure job into trading full time at a time when nobody did that and everybody thought I was completely crazy!

Taking a risk isn’t always successful…

To understand my decision to later become a full-time trader, it is important to learn a bit more of my background. Through these experiences and challenges, I learnt a lot about taking risks and how to handle the outcome when they don’t always go to plan…

I was in a secure tech job when I saw the opportunity to become involved with an Internet service provider in the mid-90s. I’d been messing around on Prestel, then CompuServe and then the Internet for a large number of years.

I could see what was about to happen with the Internet, so I wanted to jump into this emerging business. Throughout my life, I’d often been good at catching these waves of technology and tried to get involved with them at early stages. So of course, I had to take this opportunity!

But having a good idea is one thing, actually doing something about it is another. Making it a success is something completely different altogether. So this company, the Internet service provider, was revolutionary. It could see what the internet was, it knew all about it, it understood the technology behind it. However, me deciding to back their idea was a matter of right place, wrong time. It was riding on the success of the internet too early on and unfortunately this time it didn’t work out for me. They ran out of money before the Dot Com boom had even happened.

Like a lot of mistakes in life, mistakes and failures can catapult you forward and lead you to other opportunities in ways that you may not understand at that time. So my involvement with the internet service provider allowed me to push myself in the direction of dealing with companies that were involved with the Internet. Taking this risk by becoming involved in this company, emphasised the endless potential that getting into developing technology early can give you. Even if it is completely a subset of what you intended.

The Birth of the Betting Exchange and Betfair

One of those emergent technologies that I spotted early on in development was peer to peer networks. Out of these peer to peer networks emerged the betting exchange.

In a way, I knew about betting exchanges before they had even been created! As soon as these betting exchanges came online, I signed up with them immediately, starting my experience with intitially matched betting then Betfair trading. I was one of the early adopters to Betfair when it opened for business on 07/06/2000. Their press release gives an insight into Betfair’s company aims, discussing the death of the bookie and how peer to peer technology was going to replace the bookmaker.

Betfair back in 2000!

That’s more or less what it did! It collapsed the old model where there would be lots of intermediaries between you and the company. Basically, their proposition was that this format will dictate what will happen to the betting market in the future. In fact, it only took me precisely 11 days to set up an account with Betfair. (See below!)

The betting exchange business had opened up, and there were many players to the game! It wasn’t just Betfair that I set up my account with, I basically joined all these services. I had no idea who the winner was going to be at that particular point in time.

First mover advantage

Betfair’s domination

At this time when all these betting exchanges were emerging, I actually prefered this platform called ‘flutter’. The concept of ‘flutter’ was you actually communicate with the person that you’re placing bets within the market.

Here is how it used to look back in 2000!

For example, you’d place a bet upon England and you would comment on that bet:

“England is going to absolutely crush Spain today!”

– You

And then somebody would place the counter bet and also put a little note replying to your first lay bet…

“No, they won’t. Have you not seen that Spain are playing really strong this season?!”

The user placing a counter bet against you

Then those two bets would get matched and you would exchange a little note with it as well! I quite liked that, it added a little bit of something to the bets that you were placing. It was matched betting with a difference!

However, you had ‘flutter’ and had Betfair. Both of them were quite big at that particular moment in time…

To counter their rival, Betfair, a true betting exchange, decided to take over ‘flutter’. This was mainly thanks to their large funding that Betfair had. I think technically it was a merger, but like with a lot of mergers, you tend to have a bigger partner and in this case, it was the Betfair betting exchange.

So that was probably one of the most strategically important things that happened early on in the industry. You find this a lot with startups, if you have more funding than your opponent, then you can either take them out or out-compete them. That’s what happened very early on within the betting exchange industry. There were hundreds of these models and then they all started to consolidate back into a smaller number. So from the many to the few, these betting exchanges went through many mergers and closures.

Learning how to succeed at ‘arbing’ through my early days

Where I really started was with ‘arbing’. So when you look at arbing, you tend to match off positions on the exchange with bookmakers. I did this across multiple exchanges anywhere I could and to me, this was the most obvious place to start when looking at these exchanges.

An example of an early spreadsheet of mine showcasing ‘arbing.’

When we look at what I was doing around this particular period, it was pretty similar to what you sort of see with matched betting. One of the issues that you have with ‘arbing’ is that very often you can find that there is risk involved. For example, people may not be willing to take your bets, terms or odds can be amended after the situation or you wouldn’t get a payout. This was one of the biggest problems I had, some bookmakers were not paying out. They were outrightly refusing to pay me or delaying my payments! Some things never change, do they?

But it was really still a pipe dream, back in 2000 I was doing all of this alongside my normal job, but was I seriously thinking about going full time? At this point, not particularly! I had a stable job, with a young family as well, so it wasn’t something that you really think seriously about doing. It’s something that may have crossed your mind, but seems a little too optimistic and naive!

The lack of scale meant it was even more unreachable as there was no liquidity on the exchanges in the early days, so it was not really an opportunity. The only opportunity would have been to work for one of these companies and hope that they turned into a much bigger one. However, as I have said before, even that carries quite a bit of risk…

The Big Breakthrough!

Revolutionary news for betting exchanges came when in 2001 during the budget, Gordon Brown abolished betting duty. Using the internet meant a lot of bets were being taken away from the on-course activity and through established outlets. Many of these were going offshore to avoid betting duties. So as a consequence, there was a mismatch in the market and the chancellor at that time decided to address that mismatch and abolished betting duty.

This change to legislation for me was a big shout out for the fact that there was a lot of potential from this particular period going on. When you look at the growth the exchanges were seeing, you could see that there was potential to go there.

Now, there’s an important lesson for you here, because it doesn’t matter what you do at any point in your life, they’re always going to be risks attached. It’s natural for you and your mind to fear change and to really fear big changes. So leaving a job to do this full time is a massive commitment as well as risk.

One of the things that I’ve learnt over time is that very often NOT doing something carries more risk and has longer-term consequences that are more negative. So it’s especially important to put that into perspective. People often focus too much on the negative and forget the positive. Around this time I was maturing within my career. I started at a very low level and gradually worked my way up to much higher levels.

20 years ago back in the early 2000s, I was getting paid particularly well for the job that I was doing. Even though the job itself was quite a tough job and involved a lot of things, I sort of reached the point in my career that I felt I pushed as far as I could. By this point, I had already been wondering the potential of doing my own thing. It felt like, in a normal career, you would create an opportunity and be applauded, but it was always for somebody else and their name would take the credit. I began to lose the fear of going out and trying something on my own. I just needed an opportunity to really go for it full time.

Viewing full-time trading as an opportunity, not a risk

With everything going on at my stage of life, it happened that using Betfair gave me the confidence to commit to being a full-time trader. Naturally, everybody thought that was just the silliest thing that they had ever heard!

Nobody had ever done this before and this decision was going to be a really big jump at this particular point in my career. I had a young family and I was getting paid particularly well, why should I abandon it all for something that seemed absolutely ludicrous at the time to absolutely everybody? There were very few people that could understand what I was going on about!

So, I decided to do it, I made that big leap!

I thought that if it didn’t work out then, because I held a senior position in my previous job, it probably wouldn’t be a problem getting back into a role. I also felt like I needed to make a few life choices at that point.

When you do a big job, it sort of swallows up everything, absolutely everything from dawn until dusk. It’s impossible to do a big job with a decent salary without having to throw all of that commitment behind it, but that’s actually no different from working for yourself or running your own business. However, it does have its perks!

This was my chance to really need to do something with all of these opportunities. Why shouldn’t I just give it a go myself? Why waste the potential opportunity? So I did it!

How I traded and how I came to decide what type of sports trader I was

The markets were still relatively immature and so was my trading. I had a small bank to start with, so the potential risk was higher. I knew the football markets pretty well and my previous experience within football markets was possibly my chance to have an edge over others. So I started my focus on Betfair football trading. My P&L’s were okay, but nothing spectacular came out of it.

An actual example of my early trading days on the football

I didn’t have a particularly big bank and I pretty much started from £0. I believe I initially funded my account with about £1,000. I started working in these markets doing small trades and teasing characteristics out the market.

You’ve got to remember that those markets back then were nothing like the markets that you see now. They were quite immature and they weren’t particularly liquid. I’d probably say that they are nothing like they are now in terms of the way that they function and work. The markets have now gotten much more competitive as time has gone on, but with that, it has meant there is much more liquidity.

A particular aspect of change compared to in the past is that there are many more niches in the markets nowadays. When I started there were three or four vanilla strategies that you could use which needed the best of your ability to see if you could squeeze some money out of the market.

Now, the funny thing is, I started writing about trading and I was doing presentations at financial exhibitions through the 2004/2005 period. But when you look at a lot of the strategies that people talk about now, they come from that era. There’s been very little original content that I’ve seen in the last few years, I recognise a lot of what I was saying in 2004/2005 circulating today which is quite weird for me to see. Contrast that with my time in the market, experience has allowed me to continually develop, progress, branch and mature key strategies

Analysing how I have changed as a trader – comparing my early trades

When you looking at some of the early trades I have done, you’d see a bit of everything, a bit of horse racing and a lot in financial markets. I sort of started in financial markets then broadened out from there. I understood the nature of a football match well, so coming up with trading strategies was fairly straight forward.

I did a lot of financial market trading when I first went full time to see what the market was like. Excuse the pun but I sort of hedged my bets!

If you look at the profit and loss around that period, you will find that there are financial market P & L’s within there. The interesting and curious thing about that is how these pages change as I learnt my way around the markets. For example, in the image above, there’s a little bit of racing, some football in there, and then there’s financial markets trading.

So how did this change? My instinct to look at the football and financial markets changed as I began to shift my focus. I broadened out and I decided to concentrate on the benefits of horse racing markets.

So what was it about the racing market that got me interested…?

I knew nothing about racing! I had no specialist knowledge, but the market was absolutely huge, it was billions. Compared to all of the other markets I was in, the financials were really not doing a great deal of money, horse racing was incredible. Leveraging my experience in financial markets I decided to pre race horse racing markets by trading order flow. I would back and lay to take small profits from each race by trading the underlying price movements. Lots of times I would make only small profits or losses but because there is so much horse racing, it all added up to a decent amount by the end of the week.

If you looked at a detailed ledger that I kept for my financial markets trading on Betfair, you’ll see that I was still doing quite a lot of money. The problem with that market is it didn’t really grow… So I turned my attention to racing. It was clear that the horse racing markets were obviously where a lot of money was bet and the markets were huge. I knew that I had to get involved with racing!

So, wind forwards a couple of years later, and you can see that my P&L on 7th October 2006, featured no football and no financial markets. It was all racing!

I knew if I mastered racing and then I would be able to make a living just doing that, by effectively gambling on horse racing. What a crazy idea!

Clearly this was a great motivator for me to move onto racing. Of course, now there are many different markets that you can pursue that have quite a lot of liquidity. Racing is still right up there, but there are plenty of markets that you can choose if you want to carve out a niche in that market.

As I started to focus more and more on those particular markets, everything began to grow a little bit, but also my skill and knowledge within that market started to grow.

How I started to become more confident and a profitable Betfair trader

Like everything in life, the more you learn and become familiar with it, the more you’ll be able to excel at it!

My beginner learning processes – simplified!

Not making money – dabbling around markets to try and understand what on earth they were saying! ——–> I then started learning and acquiring more knowledge and information ——-> This then helped me learn to be an effective trader ——> Which developed into becoming a consistent trader which is key for success.

First, you need to attempt to just try and break-even, consistently not losing money is always a good start before you can feel confident to consistently make money!

After reaching this stage it was time to up the targets…

For example, I would wonder whether I could just squeeze £100 a day out of these markets. Of course, once you broke that barrier of making £100 a day, you start to wondered if I could get £500 and then it goes up and up and then suddenly you are now setting your goal to see if you can make over £1000 a day…!

Naturally, everyone’s learning process is different!

As a trader, your targets should mix and match and change depending upon what you’re attempting to do and how you’re attempting to do it. It also depends on what stage of your career you’re at, whether it’s your normal career, your trading career, it’s all going to be different for every single person when you first start out trading.

I remember, Adam Todd posting P&L’s talking about making £20,000 a year. At that particular point, I was trying to get about 20 grand a month because I thought how hard and far can I push this? What can I achieve?

I didn’t want to just be able to trade. I wanted to do something special, something that somebody had never done before.

This has pretty much been my mantra all the way through my entire career. I enjoy discovering new things, getting to grips with what I can see in front of me and trying to push the boundaries of what’s possible.

My first year using Betfair: profitable or not?

When you look at the equity curve from my first year on Betfair, it’s hard to pinpoint exactly when my first year was. It could be when I first joined, in which case that would be a quite disappointing P&L! It could be from when I first went full time, which would be a little bit better. Or it could be when I started trading racing full time…

But I count my first year from when I decided to start doing it seriously and I decided to leave my salary job. Now I don’t have records for the first 24 weeks or so, not even detailed records because I was messing around effectively!

But by looking at my equity curve, the first part of the year I did about 16 grand and then you can see the equity curve explode effectively upwards from there. That was when I started to do trading a bit more seriously, looking at racing and other sports by trying to bring in more things from the mix. Watch the video if you want to see the equity curve.

The interesting thing about the graph is that this was just the start...

This was pre-Bet Angel. The more I traded, the more effort I threw into it. I saw more potential opportunities. I just needed a platform on which to do them.

If we wind the clock forward and start looking at when I was becoming more sophisticated and I really started to understand what was going on with racing. Then with the creation and introduction Bet Angel into the mix, everything goes stratospheric from that point onwards. A whole range of strategies opened up to me and things just became generally much bigger!

When I first started, I was like any other beginner to a new task and I just remember hedging my bets a little bit. I didn’t have any preconception of what I wanted to do. But the only thing that drove me really was that I’d just left a well-paid job, so sure as hell needed to make up the income somehow!

So that was a motivating factor for me when I first started. But really, the first year was a case of me finding my feet, trying to do something consistently and then started to build from there. Then, of course, you throw Bet Angel into the mix and opportunities start to appear everywhere.

I always worried about what could go wrong prior to me making that leap. In fact, what actually happened was, when I sat down and started doing it, all these opportunities opened up in front of me!

In hindsight, the thing that I had worried me most, was the prospect of all this being a failure and my big leap being an absolute disaster. What I hadn’t thought about was the other side of the equation, all of the things that I would discover as I started doing it seriously. It was a salutary lesson.

The fact is, when you do start doing something seriously and you throw a lot of energy and effort into it, then you’ll really begin to find the true opportunity. Up until that point, there’s no way that you can ever quantify or write a nice little business plan before you commit. It’s only when you actually start doing it and start making progress towards those goals that you really begin to understand where the opportunity is.

I hope that was interesting for you, reflecting on my trials and tribulations of my first year of Betfair trading and how I got there! Hopefully, there are plenty of lessons in there for you.

The post My first year of Betfair trading for a living appeared first on Betfair trading blog | Expert advice from Professional Betfair trade.

Bet365 – A whistleblowers story

After sharing my insider story of behind a bookmakers trading desk, which was originally published here a few years ago and updated recently, I noticed a similar story of a whistleblower which came to light in December 2019 about Bet365.

I thought you’d appreciate my comment on what Bet365 are doing as someone who has also seen how the bookmakers ‘manage’ their customers. If you want to hear more about my specific experience within a large UK bookmaker, I discussed my experiences in a three-part mini-series ending here.

You may find it worth reading that before reading this post about Bet365, but it’s easy to draw the similarities between my experiences and that of the whistleblower whose story was published by Australian newspapers.

When this individual decided to blow the whistle, they released quite a lot of information. I have reproduced the key contents below. It seems Bet365 have a wide range of measures to identify ‘problem gambling’.

‘Those that win are stopped. Those that lose are are exploited…’

– whistle blower
Bet365 defines what a ‘problem customer’ is

In early December of last year, an informer who worked for the big bookmaker Bet365 in Australia was so shocked at what they were doing behind the scenes that he wanted to expose their secrets as it was a ‘burden on his conscience’.

He revealed how they used off the record algorithms to restrict successful punters and add a delay to those who gambled in-play. And why do this you ask? Well, this was they secure themselves a healthy profit at the expense of their customers. They were ensuring that customers couldn’t win in the long term.

Who are their valuable customers?

As mentioned in the mini-series, bookmakers have their ‘valuable’ customers. It seems like Bet365 categorises the opposite as the ‘Priority Problem customer’ and a punter named Daniel Laidlaw fell victim to this ‘problem customer’ policy.

“When I tried to place my usual-sized bets, it was apparent that I could only bet to win an amount in the range of $5-10 when previously, I’d be able to bet to win amounts between $1,000 and $5,000.”

Daniel Laidlaw

Below is a screenshot found by ABC investigations of Mr Laidlew’s profile and account details supplied by a member of staff. Here it does not just state that they collect information such as personal details, but also his secret rating. Here Bet365’s covert algorithm reveals Laidlaw as a red flag. He is someone who is a regular profitable punter, a threat to the company’s profit!

It seems bet365 has a ‘risk’ number against every punter who uses their service. If you look at Mr Laidluw’s ‘risk’ rating it categorises him at 0.0025. The former bet365 employee explains how his risk rating of 0.0025 is a very high number and a threat. With my experience, it was a constant game of cat and mouse keeping an eye on punters turnover and their personal net profit. It seems that Bet365’s algorithm was placed to keep on top of that.

So how does the algorithm work?

First off your data is analysed:

  • What sports do you choose?
  • How much money on average do you spend?
  • How many bets have you placed?

But most importantly the algorithm looks at your total turnover and how this relates to your win or loss ratio!

So if it thinks you are a constant big winner the algorithm kicks in and stops you from being able to bet any significant amount of money. When Mr Laidlow tried to confront them about obtaining his risk rating he was unsuccessful.

“I think it’s outrageous…unfair… there’s also just no transparency. If they’re profiling us in this way, then we should know as customers exactly what it means and have access to this information,”

Daniel Laidlaw

For every winner the algorithm finds, it also finds a loser…

When a punter begins losing significantly and often the algorithm will jump on that. It then helps you open up to more losses, now the losing punter is tempted with free bet offers and can gamble with bigger amounts. When I was behind the bookmaker’s desk these losers were given the VIP treatment as their hefty contribution’s to the bookmaker’s profit made them a valuable customer and we had to respect that!

Can you argue that this is the opposite of responsible gambling by a large betting site?

Bet365 claimed they had a ‘robust responsible gambling policy in place to monitor each customer’s gambling patterns and expenditure and ensure that their gambling behaviour is within responsible limits.” It seems the algorithm was created to only monitor safe and fun gambling…

So how does Bet365 define a ‘problem customer?’

Gambling in-play is a playground full of ‘problem customers’ in the eye of Bet365. It allows smart punters who rely on excellent knowledge of in play sport and sometimes a faster feed, to beat the bookmaker. However, remember this is a game of cat and mouse! The bookmakers are now at risk of not catching these clever punters, as odds can often lag behind as the game unfolds. Within Bet365’s policy statement it especially specifies the risk of the clever in play trader:

‘Betting with fast pictures will get you blacklisted’

This whistleblower is specifically talking about Australian markets. Pre match markets are similar to that which you see elsewhere in the world. But unlike in the UK, where online bookmakers allow you to bet in-play online, Australian laws dating from 2001 only allow in-play betting via the phone in an attempt to minimise losses from online betting. But the restrictions you face if you beat Bet365, are the same.

It seems that another policy document from September 2016 states that phones allow an ‘advantage‘ to punters on fast-paced dynamic sports, like tennis or cricket.

“The nature of betting on the telephone as opposed to betting online lends itself to the possibility of being exploited in fast-changing markets … some customers are aware of this fact and use the pace of the sport to their advantage when placing bets.”

– Bet365 policy document from September 2016

These documents show that clever punters getting an advantage through in-play betting was a significant threat to their profits. Even though they could categorise these people through the algorithm, they wanted to catch them before they got through and win the money!

‘Delay testing’ – the manipulative tool to stop winners


It seems perfectly natural to capture the bad guy before he does wrong again, so of course, finding ways to do this by stopping high-profit winners are in the foremind of the bookmaker.

Bet365 has used a strategy called ‘Quick Code Delay Testing’, tracking the length of punters calls and whether there were any delays once placing a bet.

Lawyers working for the company claimed the test was designed to minimise “naturally occurring” delays experienced by customers when placing bets over the phone. However, the informer has suspicions this is for something else…

He believes they are testing to see if people would notice a delay, claiming that some sports had a 1-3 second delay when a bet was submitted to when it was accepted. Obviously, every second counts when betting in-play and manipulating delays into the process can stump a punter at their game as the bookmaker can decide to reject or adjust the odds.

Bet365 did make a statement saying “it has never used any form of delay in its telephone in-play betting service in Australia,” and that its “telephone system does not have any such functionality”. – but it does make you think…

Especially when a screenshot of an account revealed that the old telephone system which allowed a punter to place bets using a phone or computer without talking to an actual human, ‘Aus BetCall’, did have a function to ‘delay.’ (pictured below)

‘delay added’ shown on a punter account

“Putting a delay into people’s accounts or into individual sports and not informing the punter is cheating.”

– whistle blower

So are bookmakers cheating?

It is clear that these strategies of delaying and algorithms in bookmakers are something that would be looked into by gambling commissions across the world. But to what extent are these bookmakers cheating and to what extent are they keeping their business alive?

In Australia The Northern Territory Racing Commission in Australia stated:

“Essentially, it’s a contractual matter between a client and a sports bookmaker. That’s the same as if I go into a shop and the shopkeeper decides they don’t want to serve me. They can decide not to do that.”

– Alastair Shields, chair of the NT Racing Commission

It seems that these gambling commissions are keeping an eye on these matters and that the ins and outs of how the bookmakers keep and make their money at the expense of the punter are always a controversial subject. That is why stories like mine and the one from the informer in Bet 365 in Australia, emphasise that there is a lack of knowledge on what happens behind the scenes to the everyday gambler.

It should be known that punters are not getting the fair game they believe they are. Winners are considered a ‘problem customer’, punters should know when they place a bet they should do so knowing the full extent of the bookmaker’s agenda and how they specifically come into their equation.

As I discovered and I’m sure many others will, trying to win against a bookmaker is extremely hard.

However, if you use a betting exchange then you are not up against these tricks, its just your opinion against others. If you are better you win, it’s as simple as that.

The post Bet365 – A whistleblowers story appeared first on Betfair trading blog | Expert advice from Professional Betfair trade.

How a bookmaker analyses your betting

This is a continuation of the story of how one of our team found a job behind a bookmakers trading desk.

In Part One, you hear about the journey of how I found myself to be behind a bookmakers trading desk. In Part Two you hear about how my initial nervousness caused me to create a palpable error, which most people would see as a bookie refusing to pay a bet. In this episode, we look at how they spot a consistent winner.

Can you really beat the bookie? Playing god over who is a winner and who is a cheater…

The bookmaker model

For all sports, a model kicks out the updated prices so there is no extra work involved, it’s just a case of keeping an eye on your position.

Everybody trades differently, some like to keep the liabilities very small and will tend to adjust prices regularly to balance the books, some like to take larger risks and are comfortable with large liabilities. They win big and lose big, but ultimately everyone ends up roughly around the same profit figure by the end of the year.

The model, combined with the bad betting traits of most punters, won’t allow you to lose money as a trader. There are individual and team targets set which are surprisingly low percentage-wise, but considering the huge turnover, it still amounts to a very healthy profit.

How bookmakers find consistent winners

Of course, amongst the majority of bad punters and losers that bookmakers are generally looking for, there is a select group of winning customers. People can win money regularly and consistently from a bookmaker, but they will eventually be restricted or have their account closed. If you are interested in why people get banned or restricted, here is why.

You won’t find much value on the main markets, but there is plenty of value to be had on some derived markets. Due to the nature of bookmaker’s wanting to increase turnover they are constantly looking to add more markets for customers to bet on.

From an in play trader point of view, it becomes extremely difficult to keep play betting through keeping track of all the prices across all the different markets. I have come across the same punters betting on the same markets day in day out, churning out long term profits. It could be a case of the model kicking out incorrect prices on a newly introduced market, or a market which is constantly overlooked by the trader.

But this is where the consistent winners at bookmakers lurk.

It is possible to beat a bookmaker?

Part of a traders role at a bookmaker is to seek out any customer who is ‘beating the bookie’.

Every bet which we take shows on our screens. With a click of the mouse, it brings up all the information on the gambler. We are looking for signs that he/she is shrewd. Do they win long term, do they specialise on particular markets/sports, have they taken advantage of arbs etc? Bets placed on the high street will get entered into the system. So don’t feel by using a betting slip in a betting shop, you are treated that much differently from online sports betting. We can still see betting patterns using increasingly sophisticated technology.

We will then recommend a punter to be restricted if we see these signs in their betting activity. If their account is restricted or closed, it won’t be long before a newly registered account appears with the punter betting on the same markets as the previously restricted account, with the same stakes etc. A closer look into the account shows a connection to the other account whether it’s via an address, IP address, surname etc. Another closed account followed by a new account and it goes on until the model is tweaked or the traders become aware of the market/situation.

So it is possible to win with the bookies, but it’s just about for how long! It’s a complex game of cat and mouse. Don’t be surprised if you are restricted when you bet or even end up with a refused bet.

Many shrewd punters will put an extremely large amount of time into making sure his/her accounts are never even looked at by the bookmakers. They use multiple accounts and attempt to spread out any profits made using exchanges. If you are showing profit in an account where that’s not really allowed, then move it to an account where ‘winners are welcome’. 

Is it possible to breakthrough unhidden and beat the bookmaker?!

Good customers (For bookmakers) – the rich and the losers!

Alongside attending meetings to identify problem gamblers and trying to promote awareness, we also have to identify punters who we can make more money from!

Customers who are betting to their maximum limit regularly, complete mugs with no concept of value with staggering amounts of money to blow….fantastic business. They are losing thousands of pounds, they want to bet more so we let them…we increase their limits. They become labelled as ‘valuable’ customers, the more they lose the more valuable they are to the business. They could be on any sport, horse racing, football or any sport. Often the betting was indiscriminate.

With these hefty contribution’s to the bookmaker’s profit comes a bit of special VIP treatment. Tickets to sporting events and other free gifts. The mega-rich punters at the top of these lists…celebrities, Sportsmen/women, ex-sportsmen/women, business tycoons etc. who seem to have unlimited funds, racking up losses in the hundreds of thousands, are obviously extremely important to the business. So much so that they have a team dedicated to looking after this elite group.

If they ever take advantage of a trader error and place 10k on Man Utd to beat Yeovil Town at 5/1 they are the only ones who will escape the ‘palpable error’ rule. The last thing they want to do is upset one of these guys when they get a big win and for them to take their business elsewhere. The poor trader who has made this error will have to take this hit on his figures, pretty much a case of paying for that mistake out of your wages.

Corruption in sport

I can’t really finish this section without touching on the issue of corruption.

In the time I was with the bookmaker, there was a list of ‘Tennis players not to trade’ which were growing with each day in my time there. As I mentioned before, the bookmakers aim to increase turnover at every opportunity, introducing new markets and also trying to cover every match of every sport possible.

This leads to us trading the very lowest level of Tennis in some cases. The prize money in some tournaments doesn’t even cover player’s expenses in some cases, so it’s no wonder this leads to ‘match-fixing’, players trying to add to their income by throwing the occasional point/game or match. The dodgy bets clearly stand out on these matches, mainly down to the size of the stakes compared to the overall liquidity/interest in the match. Game 3, Point 3, £500 on the receiver to win the point…….double fault. They would get away with it if they weren’t so greedy but after 5 consecutive winning bets and 5 double faults, they manage to build up enough evidence against themselves.

This activity is flagged and sent onwards to the appropriate authorities. Betting on something that is fixed like this, is just plain stupid for the punter and the sportsperson committing the crime.

Thank you for not winning!

I hope this mini-series gives you an insight into behind the scenes of a sports trader in a bookmaker. The playing god element of the bookmaker trader, deciding who are fair winners and who are the losers, certainly brings to light how corruption makes bookmakers nervous and unstable.

Seeing what goes on in a bookmaker made me pretty sure that, other than offers, there isn’t any way you can win long term with a bookmaker. But ultimately, that’s their business. It’s not a charity and they are under no obligation to accept customers or bets and they have to maximise returns for shareholders. It’s an ‘entertainment’ business.

But if you want to win long term then only betting exchanges like Betfair or Betdaq can offer you a way to win, where you use just skill to win and where you are not up against dark forces doing what they can to stop you!

The post How a bookmaker analyses your betting appeared first on Betfair trading blog | Expert advice from Professional Betfair trade.

Behind a bookmakers trading desk – Pt2

For part one click here

The start of my new role as an ‘in-play sports trader’…

The offices behind the scenes of the high street shops

The department was massive, large TV screens covered the walls, there were rows of desks with multiple screen set-ups. It looked fantastic, I knew I had made the right decision to apply for this job, I felt a buzz just from being there.

I pictured it to be like the trading floor of a stock broker’s with everyone rushing about, shouting across the room and a bit chaotic. It was more like quiet mumblings with the occasional ‘ping’ and ‘bleep’ sound coming from trader’s computers. Quite a relaxing atmosphere really. I realised later that these sounds were alerts for football events like goals and red cards provided by 3rd party data services.

Other traders and their styles

I met with all the traders and they were a great set of guys. All with different personalities, different trading styles, but we all had one thing in common……we were all passionate about sports trading and gambling. After getting to know each trader I noticed that their personalities linked to their personal trading style.

The loud and confident individuals tended to be the risk-takers, comfortable taking big positions and expressed many opinions about the match they were trading. Large wins and large losses. On the other end of the scale, there were quiet individuals who didn’t give much away, they tended to regularly adjust prices to keep the books balanced. Avoiding having large liabilities. Slow and steady.

How we traded

There was no right or wrong way to trade, you could develop your own style as you learnt from others. The only thing you have to bear in mind is keeping in line with the market price, in other words not putting out prices which are too far away from our competitors. It’s important not to put out any arbs, this is frowned upon by management and if this becomes apparent to management you will quickly have to explain the reasons for your prices. Unless there is a valid reason such as a competitor making a price error then you will quickly have to adjust. There’s a screen showing the bets we were laying. Move your prices away from the market and the screen will fill up with bets on your event and you can have a large liability within a couple of minutes.

The departments were split up into pre-match and in-play. I didn’t have the opportunity to meet anyone from pre-match, we were two parts of the business which were kept separate and there was little need for us to communicate with each other, just the occasional email.

Pre-match were responsible for putting the first prices on-site and would monitor their positions for much longer periods, hours, days, weeks, months etc. Depending on the event. As soon as the event goes in-play the pre-match trader’s job is done for that particular event. In my sport, I would take over as soon as the players walked out. The system would recognise every bet from that point as an In-play bet for which I was then responsible for.

My first blunder

This is where I made my first blunder (of many!) as a trader. I was about to trade my first high-level match. There was a lot of interest from not just the punters but my colleagues as they traded their matches with one eye on the huge screen showing my match at the end of the office. As soon as the players walked out the system showed ‘In-play’, the screen showing the bets I was taking was filling up at a fairly alarming rate.

It was like I was trading the only sporting event available to bet on across the whole site! I’d like to say I quickly realised my mistake and suspended the market but I was in a state of panic and basically froze, the screen of bets was a blur. It was only after a few shouts over from a few of my colleagues to suspend that I’d realised I had put in the prices completely the wrong way round, I was offering large prices that should have been very short. Everyone and his dog got on it!

I had a huge liability but of course, I was protected by the infamous ‘palpable error rule’, but it was still highly embarrassing! I soon realised that every trader has made these mistakes at some point, it’s the nature of the job, you’re thrown in at the deep end with very little training, they expect you to make mistakes, just have to learn from them and get on with it.

Palpable error – where a bookmaker can cancel/void your bet after they have made an accidental error

This early mistake dented my confidence as did my lack of knowledge of the sport I was trading. The more experienced traders in the team liked to move the prices slightly in favour of their opinions. This means there is a bit of lee-way with regards to altering the prices, but again it’s important that you stay close to the market price.

There’s often time between the players or teams coming out and the event being played, so you normally have a bit of a position before the start. Obviously it all depends on the match/tournament you are trading, In tennis for example, if you had a Wimbledon Final you will have laid thousands in bets, an ITF match from India at 4 am in the morning and you may not even have taken a single bet.

Tennis vs. Football – live betting

Peter has touched on this before in the blog about liquidity in Tennis being directly proportional to Football, you become aware of this very quickly in this job. On Tennis, you will large numbers of money on your match when there is no particularly decent football on. If a Tennis match coincides with premier league matches at 3 pm on a Saturday afternoon for example then the liquidity in Tennis drops considerably. Considerably understandable when comparing sports markets against interest within the sport through the general public.

To understand more about the logistics and the model behind preventing consistent winners, read part three!

The post Behind a bookmakers trading desk – Pt2 appeared first on Betfair trading blog | Expert advice from Professional Betfair trade.