Tuesday, 30 June 2009

The beauty of art? It's always right.

As per any post, the following is just a collection of my thoughts and experience and does not constitute any advice which I would recommend someone using and is no guarantee of future performance! With that out of the way….

From a classical painting to a scrawl on a wall, these days almost anything is capable of passing as art. Therefore, it should come as little surprise that the Draw in Rugby League is a result which provides profitable opportunities for layers and backers.

I hoard data for Televised Rugby League matches and, with the exception of March, have complete records of all my Rugby League bets this year, and believe me, that’s a lot of lines of data!

So far, there have been 65 televised Rugby League games this year by my count. Of these, there have been two draws. Warrington v Hull KR and Batley v Gateshead. From experience, I would say that a determined layer could get matched, on average, at the start of play, in the 26 – 30 region, let’s say 28. (I was hoping to get actual statistics, but this would represent my bets only for now, so I’ll largely rely on my memory!)

Therefore, the average backer would probably be in deficit, and the average layer, would probably be slightly in profit. However, that only tells half the story.

Say, as a layer, you were to choose an exit point of 3.95. Assuming a £10 lay at 28, then pulling out at 3.95 with £70, would limit your liability to £63.50 (It’s not an exact match, but this is just general comment so it’ll do – obviously as well you would need to choose a higher exit point to get fully matched at 3.95 in most cases, but as this is just a general illustration, it will do).

Now, there have been four games where the price has dipped under 4 from my records. In addition to the two above, there have been Castleford v Leeds, where 1.01 on the draw was overturned, and Featherstone v Leigh, where my lowest bet was a £10 lay at 1.41.

In the interests of full disclosure however, I have seen four games where the price dipped between 4 and 6. (Sheffield v Doncaster, Whitehaven v Widnes, Hull v Castleford and Huddersfield v Castleford – I also remember Bradford v Leeds approaching this range, but my API connection was down for that game, and I also don’t have data for Castleford v Huddersfield, where the game was decided by two points.)

So, using this as a liability guide, then you would have four losses at £63.60. And sixty one wins at £9.50. A total profit of £325.50. Not bad, when you consider that you could employ such a strategy with a stop loss tool, and no further work would be required.

Obviously, whether 4 would be the optimum get out point is something that is beyond the discussion of such a limited statistical sample. I am just using this to illustrate the potential profitability for draw layers. I am also not going to discuss whether there is a point where you can back draw bets back, mainly because I personally would never contemplate laying the draw.

Why? When laying the draw appears to be profitable?

Because, my approach, I believe, is far more rewarding, and for myself, entertaining. Put simply, I am a draw trader, and a large one at that. This weekend alone, I traded over four figures on the draw in the three televised games, and if you look at draw liquidity for these games, you will see how comparatively big this is!

Let me state from outset that I would not recommend any novice trade the draw like I do. Not only is it inefficient, if you are unfamiliar with RL or the RL markets, you risk being heavily damaged. It also forms only one part of my trading which sees me turnover a relatively large amount, and without that, I don’t think my strategy would work. I have watched Super League ever since it commenced and have followed the RL markets for over a year. I am at the point where I likely know when to back and when to lay. Of course, I still get it wrong fairly regularly so any newcomers should focus on a more simple strategy.

The draw price in play is of extreme volatility. It appears to resemble more of a betting market than a trading market, which offers opportunity to traders although liquidity is usually poor and therefore you should always be extra careful, especially in Thursday night games which inexperienced traders should just avoid. If you back the draw at a relatively high price, say before the start of the game in the 30s or during the game when the favourite has a clear lead, then usually, you will receive an opportunity to trade out for a risk free profit on the draw. Not always, and sometimes the amount that you can trade out for a profit is neglible (I accept £50 green on the draw from a £10 stake.) which is why I will look to use much larger stakes.

However, if any newcomers adopt such an approach, but don’t equalise the green, then, when the draw comes into single figures or the low teens, you can achieve a nice profit. (My records indicate 16 games have traded in single figures?) The key is that obviously the draw rarely happens, and waiting for 1.01 will cause a loss in the long term unless you have a staking plan. However, if you are willing to trade out, and look to solely avoid a loss to begin with, then you will have the opportunity to profit in the long term once you are able to decipher the RL markets, and once you are familiar with that, then you have the opportunity to increase your stakes, increase your risk and, with some luck, increase your profits.

But for now, and for any newcomer, the number one objective should be to look, listen and avoid losses. Such an approach certainly served me well during my initial learning process and even though I am still learning, I am now able to increase my stakes and risk and hopefully I will profit further. (Certainly, having four figures on the draw for most of the Wigan v Hull KR match was interesting and helped me to achieve my second biggest RL result ever.)

And with that, I will re-iterate my stance on not following my words too closely. There will be several better strategies out there than mine, that is for sure, and I have only started to outline my strategy and to outline that a profit is a possibility regardless of your initial position.

The best advice is your own advice. No-one told me to trade the draw and no-one should tell you what to trade. This is merely a starting point. Your own intelligence will make the next step, but if anyone has any questions, then feel free to comment.

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