Guide Nr. 2 - Tennis Trading with Betfair Essentials
Today I will write mainly about trading tennis matches and what influences the odds in a tennis games and some strategies/tips&tricks.
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For trading on tennis live you really need a reliable source for live scores. It is virtually impossible to trade tennis without either a live scoreboard or a live TV broadcast. It is perfectly acceptable to trade with just a good live scoreboard but would be perfect to see for yourself what happens.
TIP: Some guys that are doing this professionally have bought satellite antennas and manage to get pictures from most tennis tournaments with 2 seconds faster than internet broadcasts and cable broadcasts. REMEMBER: TIME IS VALUABLE IN TRADING! Every second you have in front of other player will get you the edge!
The best scoreboard online is that of Bet365:
Live scoreboards gives you point by point updates and is usually no more than 4 or 5 seconds behind the live action. If you register for free with Bet365 you will be able to watch the many live games that they broadcast on their site.
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The next scoreboard is the official one. I mainly go on www.tennisform.com and find on the left the livescore links. Click on the tournament and you will have something like this:
Next, you will need to see what games are in-play @ Betfair. For this I use Betfair’s tennis page at http://form.tennis.betfair.com/tennis . This page gives you a large amount of information about today’s matches including:
- Expected start time of the matches
- Current prices for each player - these are updated every few seconds
- The amount matched so far on the game
- Each player’s results for the last 5 tournaments
- Results of any previous matches between the 2 players
ALL the above information is useful for the trader.
The prices of the players give you an idea of who is the strongest player. The market doesn’t always get this right but until you get to know the players and their strengths and weaknesses it’s a good place to start.
The amount matched so far is useful because if you try to trade a game with a low matched amount or low "liquidity" it can make it very difficult to exit a trade. A match with more than 50K matched at the start of the game will have fewer gaps between the market prices as the market moves up and down during the game. The players results and in particular the head to head results can give a good indication of current form.
How does trading work?
All ATP and WTP tennis matches are In Play markets on Betfair. This means we can place back and lay bets during the game based on what is happening on court.
The basic principles of trading are simple and I’m sure you have read them in the first guide:
Back High then Lay Low
Or
Lay Low then Back High
For example the favorite’s price is 1.65 at the start. During the first few games of the match he wins a game against his opponent’s serve (known as a break of serve) and his price drops to 1.32
If we had backed him for 100E @ 1.65 and then laid him for 100E @ 1.32 we would now have a profit of 33E if the favorite wins the match and a profit/loss of 0E if his opponent wins the match. The great thing about trading is that you can now guarantee yourself a profit regardless of who wins the match!
If you divide the profit you now have on the favorite by his current lay price and then lay him for that figure you will be in profit on both players. In our example above we would divide the 32E profit by the current lay price of 1.32 to give 25E on both players!
Now, having profit on both players we cannot lose! We can watch the game without pressure from the comfort of our chair. Drink a beer or a glass of wine, eat some chips, etc J
TIP: My own strategy is not to risk. If I see the difference is not that big between the players I always get out of the market and I always like to have profit on both players.
Now you need to know what events on the court affect the Betfair prices?
Just about every point will affect the prices so I will concentrate on the ones that will move the price the most.
- Breaks of serve are very significant in tennis matches and because of this points against the serve will move the price enough to make a decent profit;
If the favorite was to break his opponent’s serve in the first set his price would approximately drop by half
Ex: starting price is 1.44 - after the break of serve it is 1.22
If the Favorite had lost his serve in the first set then his price would approximately "double"
Ex: start price is 1.44 - after the break of serve 1.88
Note: the price movement will generally be greater as you get nearer the end of the match because a break of serve can have a more immediate effect on the eventual winner.
- In a best of 3 set match if the player who won the first set manages to break their opponent's serve in the second set their price often drop to around 1.15
- If the underdog has won the first set and the favorite breaks serve in the second the favorite’s price will drop back to just above the price he started the match at.
- In the first set a player holding their own serve will see their price drop by 7 to 10 points.
- I have often read that winning a set will move the price significantly. That isn’t strictly true. Winning the set point (as long as it isn’t also a break point) won’t move the price that much. The price movements come from the breaks of serve during the set that moved the player into a position to win the set.
NOTE: In the next guides I will cover also simple strategies that you could use for trading and learn when it is better to enter the market and when to exit.
What size stake to use?
This depends on several factors:
- Your experience
- Your bank size
- The match that you’re trading
- Liquidity
These sound fairly obvious but you’ld be surprised how many people trade too big for their own situation.
You don’t need to use huge stakes even when you are quite proficient. I would normally use stakes around the 300E to 500E mark. Using these stakes you could bring in about 1500E a month relatively stress free and part time. However while you are learning to trade tennis be happy to use 10E or less. If you are completely new to Betfair trading, use the minimum allowed stakes of 2E.
Even when you get more experienced at tennis trading don’t increase stakes too quickly. If you jump to larger stakes you will probably be thinking more about how much money you’re risking rather than concentrating on the trade itself. You will almost certainly lose if you are not mentally ready for the increased stake size.
Some traders like to lay low priced favorites. The reason they do this is that the liability is quite low. For example, Federer is priced on Betfair at 1.05 - if your normal stake is 100E you could lay Fed and only risk 5E. Obviously, chances are that he will win the match but often the big players make a slow start in the first set and their price can easily move up a few ticks and you can hedge for a profit.
If the liquidity at the start of a match is below approximately 50K I would recommend choosing another one to trade. Lower amounts of money in the market can make it much harder to get out of a trade if the game doesn’t go your way. Also there are likely to be huge gaps between the prices. There will nearly always be another match with greater liquidity.
TIP: I definitely recommend using trading software. This will allow you to place trades with one mouse click. There are several good ones that will do the job well and they all cost different amounts each month. At the moment I am using and recommend The Geeks Toy trading software. It is free at least until the end of 2011 although a donation is required in charity weeks such as Children in Need. Details can be found at www.geekstoy.com. I will post also a guide how to use that application.
Conclusion
Take the time to learn the tennis markets and how to trade them. If you don’t get too greedy they can bring you a decent second income or even provide you with an enjoyable full time income.
The markets can move very quickly. Use small stakes until you are comfortable with how the prices will move in relation to events on the court. NEVER enter a trade unless you know what you will do if things go against you. In this guide I have tried to give you some ideas so you can develop your own trading style.
I really enjoy trading at Betfair, hope you do too!
Validates to