January 2010 Review

The start of a new year always offers a chance to start afresh and wipe the slate clean, that is a positive. What is a negative, or rather can be a negative, is how you react to what are usually unachievable objectives. Let’s face it, if it was easy enough to implement new ideas, you would not need to wait for a new year to begin to do so.

I approached January 2010 looking to produce a more conservative, considered approach and that started well. In the first ten days I traded 21 markets, producing a profit in 20. The only one that showed a loss was a £1.86 loss whilst trading the Valencia v Espanyol match odds market before kick off.

The other twenty markets included a mix of correct score and match odds trades on football, three rugby union markets which I will comment more on later and a penny profit on the cricket!

The end result of all this was a total profit of just over £300 and some consistent, well thought out trading plans.

Unfortunately, the next day was not so great. It started with a loss of £166 on Leicester v Ipswich thanks to a goal inside 30 seconds. At the time, I was unperturbed by this. As a 0-0 scalper, I have to accept the fact that sometimes a goal will be scored which will cause such a loss and what made this one so heavy was a drift in the pre match 0-0 odds from 11 to 12, seeing me jump on board at 11.5 and 12 whereas it is usually the case that 0-0 odds will come in or stand still.

However, in such circumstances, I should not look to double up. Rather than backing pre match at 12, what I should attempt to do is to insert a back into the market at kick off. I would have been able to place my lays and would have avoided being in the market for quite as long although obviously this is not a fail safe plan.

What really irritated me on my trading was a £86 loss on Dancing on Ice the same evening. In 2009, I had traded both X Factor and Britain’s Got Talent very well and felt I could do the same on Dancing on Ice. However, after this loss, combined with additional losses in Week 3 of £30 and in Week 4 of £40, I am starting to arrive at the conclusion that I am unable to trade this market.

The main reason for this is the vastly decreased liquidity. My preference is for short term trades. I do not like to sit on an open trade. This sees me cutting short my good trades too soon whilst allowing bad trades to run longer in the guise of value. For instance, this week I backed Heather, Emily, Hilary and Sharon in performance to be eliminated. The first two shortened whilst the latter two drifted. However, whilst I cut out my Emily and Heather trades too soon, I let my positions on Hilary and Sharon run believing them to be value. That they may be, but if you cut your position on some and not others, then you can end up with an unequal book and whilst in high liquidity markets, I find an ability to buy myself out of trouble, I cannot do this in lower liquidity markets. Therefore, I think that I will look to give this market a wide berth in future.

And as for the £86 loss in particular, the two most galling facts were the fact that I had opposed the “late money” which had proven to be amazingly wrong in the X Factor and that even had I attempted to get out of the trade, having an open position when the show begins is very daft. It is alright to point out that in every other show they had allowed 10 minutes recap before closing the phone lines, but I had no evidence that this would be the case this time and not taking this into account was very very poor.

So, £300 up after 10 days to £60 up after 11 days. I had climbed the stairs slowly and then fallen down nearly all of them again!

What happened next? Well, without going into too much detail some of the issues that I have referred to previously reappeared and my trading suffered, possessing more of the computer game mentality.

I had once again arrived at near the £300 mark when the most obvious display of my stupidity when trading appeared. Just a quick note, I had managed to get myself back to £300 in 7 days thanks to more football trading, a couple of rugby union trades and a well timed lay of Arizona against Green Bay as an insurance bet as a Cardinals fan!

The game where my next loss arrived was Bolton v Arsenal which saw 0-0 drift from 18.5 to 20 pre kick off and then a £5,000 layer look to disrupt the usual linear progression of 0-0 and as a result, mess up my book. My response was two fold. Firstly, the 0-0 odds were greatly inflated and I recognised that there was some value to be held in keeping 0-0 green. That was a perfectly appropriate thought process.

What was not was that after being able to remove any red at 12, I decided that wasn’t good enough and therefore looked to insert a near maximum back at 11.5 literally 30 seconds later. Now, I knew that I was at the front of the queue at 10.5 so that the risk was minimised some, but this was just a sheer stupid trade and even when I had the opportunity to scratch it, I refused to. And then the goal went in…

Sometimes, I can let personal issues affect my trading and this was the perfect example! I betrayed my process in anger and rightfully suffered.

Worse was still to come when the next day, I looked to trade the Newcastle v West Brom correct score market at half time. One particular score, 2-1, moved against me but as I knew that this would come in during the second half, I was content to let it run rather than accept a loss.

I then got distracted, and without even being able to decide whether to cancel, a very early goal was scored which saw me down over £200. Just a ridiculous trade which goes against everything I try to accomplish through my trades and a trade which actually saw me in negative figures for the month.

The next two weeks saw me get back into the green at around £100 although this also saw some very poor and ill considered trades actioned during this point although not with the stake level as the errors highlighted above before the return of Rugby League helped to lift me to nearly £400 profit for the month, before a Dancing on Ice error saw me end the month £347.01 up excluding the result of any trades on the Superbowl market.

So, what have I learned?

To start on a positive, I have displayed a clear ability to succeed. All the errors made have been identified and are easily rectified. I have shown the ability to profit consistently when I remove any external emotions from my trades and turn off the computer game mentality. This should also look to improve with the return of Rugby League.

Secondly, and I feel dirty for even mentioning this, I am starting to enjoy rugby union. For as long as I could think, I have hated the game and everything it stands for. However, recently, I have found it reasonable to watch and have been able to make consistent profits with all the nine games traded showing a profit. It also helps that I find it an incredibly rhythmic sport to trade and my draw trades do not even compel me to view the game.

I am not sure whether the internationals with increased liquidity and volatility are a good area to trade but I am confident that with some adjustments to draw trading such as in the second half where the score numbers affect the draw largely and sees liquidity fall off that this can be an increasingly profitable area for me.

Also, the return of Rugby League will hopefully see earnings grow. After all, this is the sport that I get and where I can best apportion any green earned through trades.

However, I must ensure that I retain full control of my emotions when trading. It is true that when the opposite is the case that I probably feel more inclined to trade but I cannot allow that to make poor trading decisions for me.

Above all, I should focus on why I trade which is for the challenge and the enjoyment as much as the profit and to look to decrease self imposed pressure wherever possible (The issue with being a complete perfectionist…!). I have already noticed a marked reluctance to trade football with rugby league back and I should look to continue to trade what brings about the most pleasure.

Total Results:

Cricket - £0.01
NFL -- £40.11
Rugby League -- £213.31
Rugby Union - £143.95
Soccer - £102.12
Special -- -£152.49

As usual, I am grateful for any comments after another incredibly lengthy attempt at some (As usual) heavy self-analysis!!!