I often receive emails questioning why I have given up trading the horse racing markets at Betfair and whether a trader can make money nowadays trading fixed odds of the favorite horse. The fact that I cannot make it pay anymore doesn’t mean other traders are unsuccessful as well. It means my trading strategy is no longer profitable for me. Did the strategy have flaws or were the markets that easy to trade back in 2005? Maybe it’s because broadband internet connections have improved dramatically over the past few years worldwide and the technology advantage has been obsolete. The fact is though that my trading method is simply doomed to fail and here is the proof!
From time to time I wander around the horse racing markets at the betting exchange and try to resist trading the odds. Yesterday I decided to try one last time the trading act, since I have received a couple of encouraging screen shots of another Betfair trader who wins more than €70,000 per year. I failed miserably as you all may see from my yesterday’s profit and loss screen shot in the beginning of the post. There was simply no point in continuing trading the markets for the day, as I lost 4 out of 5 races. Some would say that it could have been bad luck, bumping into the difficult markets of Monday. Truth is you know when your strategy isn’t working, you just see it in front of you. You enter the market and seconds later the odds move against you. You trade out only to see the odds move back up, towards the way you predicted. You wait and begin trading once again but it seems like either someone is quicker than you and your bet isn’t matched or they are smarter than you and when the bet is matched, the market moves unpredictably.
Support and resistance, technical analysis and trend lines you say? Sure, they are all there and boy, have I not discussed about them a lot. Betfair graphs aren’t the most effective charts to apply technical analysis on, but they do offer some help. In the end though, it is all about the profit and loss screen. Losses because I laid at the support level, and a support level breakout happened shortly afterwards. Losses because there was a false breakout and the support eventually held up but I was too stubborn to accept that. Trend lines which break and there is no sufficient odds’ fluctuation to make up the losses I accumulated during the first 5 minutes of trading the horse race. It’s becoming frustrating, and frustration is a sure way to disaster.
To all newcomers in the Betfair trading world, this article is not about the impossibility of winning by trading the odds and unbeatable horse racing trading. It is about the markets’ potential for any trader to turn a profit. When there are price movements and crowd psychology involved, there is always room to make money. What worked for me and doesn’t work anymore may actually work for you. Or alternatively what works for you may not work for anyone else! Shocking huh? Well, you just need to find out that specific winning strategy and apply it on the horse racing markets or anywhere else you see fit. And don’t let anyone tell you that you cannot make money these days. The final judge would be the P&L screen of your Betfair account and mine has certainly made its point.