April 23, 2014

Profitable Trading Strategies

This is a short series of profitable and paying trading strategies from the LayTheOdds authorship that we translate and customise into the following tutorial. It is entirely different from the analytical approach of the money weight evaluation and from the odd/volume diagrams study (not that there’s something wrong with that method).

It will be covered several methods, all of those used by me, although existing many other strategies involving everything and something more, from horse races to football (soccer) or even Big Brother!
I apologize in advance if you find my explanations a bit “paternalistic”, “arrogant” or “meticulous”, but these methods were written for newcomers into the trading and sporting bets, as also for those who are already “fluent” in many of the basic concepts related to trading or sporting betting exchange.

Besides the supply of strategies that you can use to make quick money, I hope these articles can also provide you with enough knowledge and technique to allow you to create your own methods according to your own needs or aims. After all, the individual study is the only way for a punter/trader to learn to stand on stand on his feet.

Part One

Strategy Number 1:

This is my personal favourite of all shown strategies, mainly because if you apply it to the right game you’ll be ensuring profit almost 100% of the time. I will explain later about what I mean by “the right game”. For now, here’s the abstract for what this system involves/implies/how it works.

The concept is simple – when a goal is scored in a European football match, the prices for all of the game’s outcomes (victory for the home team, victory for the visiting team or draw) change. How the odds change depends on many factors, as in which team scores the goal and the game duration or the moment in which the goal is scored. In this strategy, we try to bet against the draw (lay the draw), before the kick-off, with the purpose of betting in favour (back the draw) afterwards at a higher price, when the first goal of the match is scored, ensuring a good profit in the process.

For instance, let’s say Sporting Clube de Portugal is playing at home before Belenenses. Sporting, with odds of 1,45 is the expected game winner and it should score the first goal. In this case, the draw odds (7,20) should go up and afterwards you only have to bet in favour of the draw at a new price, offering yourselves a free bet, which is always a good bonus or equally distributed profits, whatever the match’s final outcome, only depending on how you chose to make your bets.

This technique, by itself, is in its essential, imperfect and defective for two lines of reasons.

Can you think of which?

If you reached to the conclusion that whether it is the lion or the cat, the Belenenses, in this case, can score the first goal or the match can finish at a draw 0-0, congratulate yourselves. Obviously, if the lesser strong opponent scores first, the draw odds decrease, leaving you in an uncomfortable position. The same way, if no goal is scored, so the null outcome persists, the draw odds tend to gradually fall, leaving you “out of play” and with a heavy loss. However, the good news for both problems is that these can be corrected, leaving you with the perfect strategy (at least, I have never lost money this way after using it many times to make money). I will discuss how you cancel the risk of 0-0 and that of the cat’s first goal in the next section. For now, I leave you to ponder with this question: are you able to think and find about the appropriate solutions?
It’s a no-brainer, the answers are actually straightforward and this can be a simple exercise to help you solve your own problems when and if you create your own strategies like this one for your own use.

Part Two:

Strategy Number 1: Laying the Draw in European Football (Continued)

Were you able to find the solution for the problems previously found in “Part One”? So, congratulations if you reached to the conclusion of backing the draw on 0-0, in the market of the Exact Outcome or Right Outcome, in a way that, in case the draw wins, it covers the liability of your draw laying, eliminating the chance of, in case the match finishes null with no score, and in between, you potentially end up bankrupt and without a penny.

Congratulations to you also if you were able to think about choosing only the games in which both teams have a relative likelihood of winning, to avoid the possibility of a cat like Vitória de Setúbal to score a goal against one of the European football giants like Manchester United first.

Simply add these new filters to the previous version of the theory of laying-the-draw discussed in “Part One” and create a situation of non-loss for yourselves.

Below, I leave you a real life example of a type of match that you should sought and one on which I laid my money. It happened just this season, in the Sagres League. Second run, 30th September 2008, Sport Lisboa e Benfica takes in Futebol Clube do Porto. A Benfica in renewal process and out of Vila do Conde with a one ball draw, takes in a FC Porto victorious before Belenenses for 2-0, in the Dragão (Dragon Stadium) opening match. The Betfair odds showed a Benfica at 2,50 slightly favourite, a draw at 3,40 and a FC Porto at 3,00. As you can see, the differences between Benfica and FC Porto were minimal, not existing neither a clear favourite nor a cat or a royal lion, so no matter who scored the first goal in this match, the draw odds would suddenly go sky high, allowing this way a bet in favour to have a higher and more favourable price.

Confident for having created a non-loss situation, I betted against the draw at 3,40 with a stake of €416, keeping a liability slightly under €1000 Euros and, to cover my losses in the event of a null draw, I betted in favour of the 0-0 at 9,00 with a stake of €135 Euros in the market of the right outcome, which would leave me with the lovely profit of €80 Euros gross, in case the final outcome registered a null. Taking the 5% commission charged by Betfair off, the profit on 0-0 would only be €1026 Euros which, subtracted to the €1000 Euros liability lost in the bet against the draw, it would leave me with only 26 Euros extra of the starting balance.

As soon as the classic started, I sat comfortably waiting for the first goal. I hadn’t finish drinking my first beer and already FC Porto, through Lucho Gonzalez, in a big penalty mark, scored the first goal at 10’ of the first half. As soon as the market was reopened, I confirmed that the odd in favour of the draw had substantially increased to 6,00 so promptly I betted in favour with a stake of €280 Euros, ensuring a nice profit, without any big or complicated efforts.

Instead of waiting for the start of the game, this match was a big example of how discipline is important. I could have been greedy waiting for a better price, suffering with my heart in my hands, which could have been disastrous for me, since on the second half Benfica scored a draw around the 56’ through Oscar Cardozo. Despite of two minutes later, Kostas Katsouranis having been expelled for yellow cards accumulation, the odds for the draw had decreased considerably and, if I hadn’t followed the rules properly and ensured my profits straight away I would have lost a whole lot of money!

In the end, my calculation in terms of Loss and Profits were the following:

+ €1330 won with the bet in favour of the draw after the first FC Porto goal (+€1400 gross);
- €998,4 lost due to the liability of the bet against the draw (€416) before the start of the match;
- €135 lost in the bet in favour of the 0-0 in the market of the right outcome before the start of the match;
= + €196,6 Euros profit.

PROFITS/LOSSES = + €195 Euros, already including a 5% deduction in commission by Betfair.

Not bad for less than an hour’s work!

Allow me to give you another example, not so recent, of how to make money betting against the draw and in favour of the 0-0, in matches where neither there is a clear favourite nor a clear cat or lion. Do you remember the World Cup 200, disputed in Germany, where Portugal ended in 4th place? At the quarter finals match, between Germany and Argentina, the celestial-white had showed good practise football, but would have ahead the home team, “willing to anything” to return to the old times when, as famously stated one day Gary Lineker, “in football 11 play against 11 and in the end Germany wins”.

There was who prophesied that the winner of this match would win the World Championship and the odds for the match showed that it would be a disputed game. Germany was slightly favourite at 2,80, the draw was worth 3,15 and Argentina would also worth 3,15. The fact that the odds were so close to each other really showed how there wasn’t neither a favourite nor a clear lion, which would mean that, regardless of the national team that scored the first goal of the match, the price for the draw would only shoot off like a rocket to immediately be used at a higher and lucrative price, for as much as both teams were and are recognized by the respective offensive skills.

With the trust relying on the fact of having created a non-loss situation, I betted against the draw (laid the draw) with €465 Euros, resting with a liability lower than €1000 Euros and, to cover my eventual losses in case of a 0-0, I betted in its favour in the market of the correct result, with €120 Euros in an odd of 11,0, which would leave me with a gross profit of €200 Euros, in case the match would end with a null or a net profit of €140 Euros thanks to a €1140 Euros winning after the 5% commission charged by Betfair, deducting also the €1000 Euros liability lost on the bet against the draw.

Once again, I sat on the easy chair to watch the game peacefully waiting for the first goal. Argentina, through Roberto Ayala, scored the first goal of the match, in the sequence of a corner kick by Riquelme, which made shoot off the price of the draw immediately following the market suspension when a goal is scored. Promptly I betted in favour of the draw at 6,60 with a stake of €250 Euros, I was aware that, with very little work, I had ensured a very interesting profit.

Once more this match was another big example of the importance of the discipline in the trading. If I were greedy and waited to get a higher price on the draw, I could have lost the two first bets, because as soon as Riquelme was replaced Germany managed to draw, finishing the regulation 90 minutes with the outcome of 1-1, with Germany resuming ahead after the penalty marks. Consequently, the price of the draw decreased to nearly 2,00 and, if I hadn’t followed the rules in a proper way immediately holding back my profits after the first goal, I would of suffered a great loss in my balance, losing a lot of money in between!

In the end, my calculations in terms of Losses and Profits were the following:

€1400 – €999,75 = €400,75 (or €330,25 after commission.. in net earnings)
€330,25 – €120 = €210,25
PROFITS/LOSSES = + €210,25
Not bad for less than an hour’s work!


Regarding the calculation parts shown above, we have:
€1400 coming from the earnings of the bet in favour of the €250 at odds of 6,6;
€999,75 coming from the liability of the €465 stake used in the bet against the draw at 3,15;
€120 coming from the stake used in the bet in favour of 0-0 at 11,0.

Final Thoughts:

And so it is complete the first strategy that I will discuss in this mini-series. I hope it has been useful to you.

However, before I finish, I want to underline some important issues to have in account regarding this strategy, which I had not had the chance to mention:

- I prefer and always make sure that my stake in the bet is in favour of the 0-0, in case of null, will provide me a little bit of profit. The alternative is simply betting in favour of 0-0 to cover the liability of the bet against the draw and nothing else. In the event of a goal being scored, I will make more money this way. However, I should emphasize that, if you wish so, as I do, to ensure the profit in the game in the event of a draw at a null, it is important not to be too greedy with the profit that you’ll try and have. Firstly, the chances of a match finishing at a null scoring are low and secondly, if you bet in favour of the 0-0 with a very high stake, you might have difficulties getting a global profit in the draw trade, when the first goal is scored.

- Whenever possible, it is always best to find matches where the goals are expected from both sides. These games many times have very high odds for the exact outcome at 0-0. This means that you may put less money in your stake of liability in the bet against the draw, less money on the bet in favour of the right outcome at 0-0 and you can generate a higher profit when and if the first goal is scored.

- If a bookmaker offers a price on the market with “No goal scorer” that is practically the same price as in Betfair for the 0-0 in the right outcome market, I then advise you to bet in favour at the bookmaker with a stake on “No goal scorer”. The reason is simple. When you bet in favour of the “No goal scorer”, the goals scored in their own goal line don’t count. Therefore, if the game would end at a 3-3 draw, but with all the goals being auto-goals, you would still win your bet on the “No goal scorer”! Many punters are aware of this fact, but for most bookmakers this is the rule. This means that, in some occasions, when you make a trade in a game that ends with the final outcome of 1-0 with a scored auto-goal, you can make lots, lots of money in profits, because not only did you win the stake on the “No goal scorer” as you have also performed a successful trade.

Many of you will certainly remember the England’s World Championship 2006 opening match. It ended with a victory at 1-0 in favour of England and with Carlos Paredes, from Paraguay, being credited with an auto-goal! I myself used this strategy for that same game and, needless to say, I won a small fortune in money. Now, don’t just bet in favour in the market of the “No goal scorer” just because of the auto-goals. First make sure that you get a good value with a price similar to that of 0-0 in the market of the exact outcome on Betfair. If the difference is abyssal, simply bet in favour of the 0-0 on Betfair. Less money on the stake of the bet in favour of the right outcome on 0-0 at a higher odd may mean a higher profit in the event of a first goal, be it or not scored in the own goal line. Remember that the purpose of this strategy is to make money with the bet against the draw, not with the auto-goals.

- Such has never happened to me on a game on which I had trade previously, fortunately, but at a certain point you may have a trade on a game with this strategy and having to face the fact of a player being expelled before a goal being scored. For example, a big penalty is marked and the goal keeper or the defensive player of one of the teams is expelled. As I was saying, such has never happened to me, therefore I am not certain of how the market would react, but it is possible that that might mean that you might lose a lot of money if the market goes against you. However, I imagine that, when a player is expelled, the price for the bet in favour tends to increase. If this is the case, as it should be, I recommend that you close your position on the trade for the draw with a little profit and also that you lay a bet against the 0-0 in the market of the exact outcome for a lower price, this way ensuring a profit in that market as well.

To end up miserable and unlucky for finally finding a loss, I imagine that you would have to be very unlucky and have some player in the match expelled straight at the first minute (despite of the referees usually avoiding shows of the red card in the first 10 minutes, this has already happened a few times), but generally, after five minutes, the price of the 0-0 starts to fall more and more, so you should be able to close both trades, be it for the draw as for the 0-0 and close the respective positions with a draw, when someone is expelled from the field. If someone is expelled after the first goal, that’s not really an issue. At that time, you should have closed your positions already and made your profit, having made money in between. The good news is that, despite it all, this is the only setting I am able to predict and think, that could negatively affect your trade and 99% of the time you should still manage to generate a good profit and make money!