Sunday, 6 September 2015

Up and down

After I reached two days ago a new all time high, I am back to 0. Sometimes is hard, but as a trader you have to live with this variance.

Like I wrote yesterday, I have to improve my patience. In general I recognized that is better to trade the underdog than the favourite. The market often expects a turn around when the player with the bigger name is trailing. So the value is often poor. Yesterday Serena Williams started at 1.05 (against Mattek-Sands). Despite the number 1 was struggling, the market kept the trust. You could back her for 1.50 at the end of the second set for a while. Of course that can be an option (definitely better than back her at the start for 1.05), but the better way would lay her since the start. The worst case is loosing five ticks, they will not kill you.

Here I see a lot of potential. Instead of waiting for an expected comeback, it's often better to lay the big name at the start or at an early stage of the match. Many times the favourite doesn't start well. Even Djokovic (against Seppi) had some problems in the beginning. Unfortunately I traded for comebacks of Radwanska (against Keys) and Ferrer (against Chardy). Probably it was not a good valuation of the situation. The mentioned players have not the best season and Ferrer was even injured for a while. On the other hand their opponents are quite strong at the moment. I make still too often the typical mistake to go with the bigger name. I have to be more selective!

I recognized that another good blog (BIG PAIRS) is gone. In this point I have to agree with Cassini. It's astonishing how many blogs start with a lot of enthusiasm (and often good results), and suddenly they are not updated anymore. Probably it was another loudmouth. I was a bit suprised, how his profit was skyrocking. Often this is a sign that something is smelly. I am definitely not the most successful trader (yet), but at least I am honest. I try to keep the blog interesting, but is getting more difficult. My trading approach is quite stable now, it's just a kind of bad game selection I mentioned above.

Today I will trade the whole evening and night. I hope I can fight back from a small downfall. If not, it's not the end of the world. I just made an overview of my financial portfolio and recognized that my (virtual) Betfair account is only 2% of it. It's the part with the highest volatility, so I can't invest too much money at sportsmarkets. I am sure that this global view helps to strenghten my mind. In the end trading is mainly a psychological game. The long term winners have discipline and are mentally very strong. Caan wrote once again a good article about it: 4 trading fears. I agree with everything. Especially the part with successful people is interesting. Yes, it can be one of my problems. In my job career I didn't fail often. So it's still hard for me to lose trades. I have to learn and accept that only the long term is important!

Saturday, 5 September 2015

There's a light on the horizon!

The strategies are stable since a while. I feel more and more comfortable with the new trading approach. I think about the market and not about technical aspects like risk-/reward-ratio, entry- and exit-levels or profit. The trading is in the flow now. The improvement also has an impact on this blog. I recognized that is a lot more difficult to write, when everything is going alright. Well, it's not a bad feeling at all. :-)

Of course the trees are not growing in the sky, I still have a kind of overtrading. Probably the small stakes have an impact on this behaviour. When I have spare time to trade I like to be involved in the market. With small liabilities the temptation to enter the market - even with an inadequate situation - is bigger. Like I mentioned at an earlier post, I set a monthly budget. I didn't use this (new) money yet. Every month I will put more money on this virtual betting account. So I can rise the stakes steadily.

On the left side you can see the devolopment of the profit since I rised the risk-/reward-ratio to 1.0 and above. The variance is a lot higher than before, but real hurtful downfalls are not expected. Before I had to win four trades after a lost one to be be breakeven. Now one is enough to be in the green zone again. In general I am more relaxed. This feeling has a positive impact on my trading.

It's still a long way to go, but I feel the progress. There are no more doubts about the strategy. The practice will help to become a better trader. Full time trading is no target anymore, I feel 100% happy about my new job. Sportstrading should be an interesting side income and a good diversity to the stock markets.

 

Saturday, 29 August 2015

Variance is part of the trading

Lately I was more focused on the stock exchange than on Betfair. That was one of the reasons, why I didn't trade much. Beside there was not that much action during the evening hours. The whole week I just made six trades. Nevertheless it demonstrated, how the future could and should be.

First of all it showed that the variance is high. After five trades I was in the red zone, one good one helped me to reach an all time high.

Second the biggest profit is higher than the biggest loss. This is important. You have to cut your losses and let the greens run. This principle is implemented in my trading strategy. The average profit is lower than the average loss. This is not alarming, because it has to do with partly won trades. I have two targets after I opened a position. The first level is the breakeven value, the second one gives me in every case (it doesn't matter which player will win the match) a good profit with a risk-/reward ratio above 1.00. So, when only the first target is reached, normally results a small profit (and sometimes a small loss, when my forecasting was too progressive what doesn't happen that often). This fact deforms a bit the comparison between average profit and average loss. This is also the reason, why I can't calculate the yield anymore. Because of stop loss levels, my liability is higher than the real risk. So it would be very complicated and boring to calculate this figure. Beside it results an over analyzing of my trades, which were a handicap in the past. In my opinion the chart and figures shown above are enough to control my trading activities.

Like I wrote in my last posts, I can handle now my emotional side. This helps to accept a bad run like I had after a promising start. Of course I just made six trades and you can't over-interpret that, but a promising tendency is here. I am happy with my new approach, and I start to make the right game selection. The main reason is an improved patience. Before I made a trade, even when the scenario was not the best. Now I am more selective, this is also a reason why I just made six trades.

Next week starts the US Open. I will focus more on the WTA tournament. First the volatility is higher than at ATP matches, because the serve is not that important. Second I don't have much experience with five set matches. In general I am happy that the last preparation tournaments are over soon. At the Salem Open (ATP) and in New Haven (WTA) you never knew if a high ranked player is enough motivated to give 100%. I saw some players tanking, for example Karolina Pliskova. It's quite annoying, when you lose money because a player prefers to have a break before an important tournament than proceed...

Tuesday, 25 August 2015

A mixed portfolio for diversification

Last days I recognized that only a very small part of my money is involved in tennis trading. The stock exchanges are tumbling, because the economy of China is probably not growing that quick like expected. To be honest, the nervous markets are not good for my portfolio. I lost a high four digits amount in the last days (well before I made a five digits profit, but losses always hurt). Unfortunately the stop loss orders didn't help much, because the markets (at least in Europe) bounced back today. Well, I expect another red day tomorrow. So it's probably better being less involved in the stock markets and concentrate more on the sports trading.

Well, to make a long story short, I saw that sports trading is just a very small part of my side income. So I decided to judge it in a main context. In the future I will invest a part of my savings in sports trading and a part is reserved for the stock exchange. Beside I will keep cash, my life insurance and of course my appartment. With this diversification I should have a good base for a growing fortune.

How this decision influences my trading? I will be more relaxed. Sports trading is just around 20% of my savings. Beside I prefer to trade and not to analyze. Unknown mentioned it already some weeks ago. I think it didn't help my trading to report and comment the KPI too often. I have a tight money management and a decent risk-/reward-ratio, that's enough. I will upload my trades to mybetlog (www.mybetlog.com), but not publish the KPI section anymore. For example it's very difficult to calculate the yield with so much positions and stop losses. The basic stats like average or biggest profit and the development of the bank are part of the mybetlog tool.

About trading itself. The last week I finished the setup. I talked about it in my last post. There are three different stakes and every position is not closed before I reached a risk-/reward-ratio of 1.00. With this approach a strike rate of 50% is enough to have a small profit. The theoretical stuff is done, now is about practice. In the future the posts will be again more about my time on the ladders and less about the approach.

Saturday, 22 August 2015

Monthly budget and defined risk-/reward-ratio

I already wrote about the opportunity costs. This week I felt stronger than ever that they are too high with the current setup. It doesn't make much sense and fun to trade four or five hours for a possible profit of two or three Euros. Of course the sense of this approach is the protection of the bank. It's not recommended to trade with high stakes with an unproven strategy.

First I have to tell that the strategy is not that unproven. Sultan had success with it, and on the markets you can see that the method with mainly low lays are a famous and successful one. Second I recognized that the new approach works for me if I stay patient. Third you can define an amount, which you can afford to lose without bad emotions. It's definitely higher than the current stakes. Fourth the opportunity costs are lower... obviously you can lose more money (and then you have opportunity costs and real costs), but in the last weeks I always managed to end in the green zone.

I decided to trade with a monthly budget. Of course it's not the target to lose it, but with this definition I can trade with normal stakes (5 Euro = 1* trade, 10 Euro = 2** trade and 20 Euro = 3*** trade) and an adequate money management.

Beside I could finalise the often discussed topic with the risk-/reward-ratio. I analyzed a lot, and decided that every single position need at least a rate of 1.00 (after commission). This means that I risk one Euro to win at least one. As a consequence I "only" need a strike rate of 50% to trade breakeven.

The biggest change I made since last week are the addition of different levels I hedge a trade. While you can green low odds quick, you have to be more patient with odds around 2.00. I had to make this adjustment, because I recognized that some trades had a terrible risk-/reward-ratio and crashed my profit and loss statement.

With the mentioned adjustements I start again to report the trades to mybetlog. I will write from time to time on this blog about the financial development. Beside I will think about a reintegration of the KPI section. Like a reader mentioned, it's my blog and I like the numbers. I just couldn't handle the pressure as good as I should.

Sunday, 16 August 2015

Week 4 in review

At Thursday I already talked about it. I made a change of the strategy, which gives me more flexibility. I differ now between 1*, 2** and 3*** trades. Dependent on the time, the trust and the downside potential I risk more or less. I don't use something "complicated" like the Kelly criterion for calculating my stakes, but as bigger I see the value as higher I stake. In general it's a change in the direction to a more intuitive approach.

Beside I rised the target risk-/reward-ratio. The first principle of trading "Let the profits run and cut the losses." is now more integrated in my strategies. With the newest update a 45% hit-rate is sufficient to reach a breakeven result.

Last week I didn't analyze my results at mybetlog.com. It's still too early for an ultimative test. That's also a reason, why I didn't publish anymore the KPI. The nice feedbacks convinced me to do it again in the future. The only negative feedback was the one of Cassini, and I don't care anymore about his opinion.

In general it was a good week with a small profit, and the above mentioned changes will (hopefully) be the base for a bright future. Since I started my new job, I don't have that much time to trade anymore. Some matches are too early (before 6 pm European time) and some take place too late (after midnight). Unfortunately the weekend is extremely low of action (only the half finals and finals). On the other hand you can find soccer matches in every corner. Nevertheless I will stick at the tennis ladders. With rising the stakes, what is planned in the future, qualitity (often half finals and finals bring balanced matches with a lot of swings) goes even more over quantity.

Next week a masters 1000 tournament take place at Cincinnati (WTA and ATP). Again we will see the major players in action. Even Roger Federer returns to action. I will use these days to stabilize my new trading approach. Beside I will start again to report the outcome of the trades at mybetlog.com. It's planned to give an overview about the results in next weeks review. Beside I will think about reintegrating the KPI section on the blog. When I feel 100% confident about the strategy, it shouldn't be a (mental) problem anymore.

Thursday, 13 August 2015

More flexibility is needed...

First of all I like to thank all readers for the nice feedbacks about the debate with Cassini. It seems that he has nothing more to write since he doesn't bash me anymore. Well, that were my last words about him. Trolls live from feeding them, so no more talking of this topic.

This week I traded not that intense like before. Mainly I watched the markets and made a kind of virtual backtesting. I recognized that there is a big potential with flexible stakes. Before I didn't consider the combination between the absolute risk and the liability. The best example was the match between Isner and Johnson. Big John was a break down, and there was almost no downside risk anymore. It was the perfect opportunity to scalp for a service hold of him, especially when he was 0:15 behind. With this scenario you had around five ticks risk, and you could make five ticks profit. That's an amazing risk-/reward-ratio, because the chance that Isner holds the serve - even when he loses the first point - is at least 70%. On the other side five ticks are not a big swing, so a small stake doesn't bring much money. In this scenario a rise of the stake makes sense.

Beside I have to be more patient. It's better than some months ago, but I still take a lot of times only the second best opportunity. I recognized that often better value is coming, when you are patient. In general I would say that I trade now more freestyle (intuitive) and less like a (mathematic) robot. Of course everything is still inside the strategies, but with more flexible stakes and stop losses.

With the defined risk-/reward-ratio I feel okay. In general I risk one tick to win one. To cover the commissions and the hedging costs, I need a hit rate slightly above 55% to be breakeven. With this setup I should not have too long losing streaks, and if I have a bad run, it doesn't take forever to return in the green zone.

Sunday, 9 August 2015

The sense of this blog

My blog is getting famous, every third post of the "big Cassini" it's about me: Green all over. It's a bit weird of a guy, which says that he is not interested in tennis trading, and that my blog it's not a good read. For me is strange that he has a (negative) opinion of "all" people around him. It was not different, when Sultan was an active blogger.

First of all I have a bit of understanding about the criticism of the KPI section. I never wanted to show a wrong picture, where I don't count trades, which I lost. It should be a guideline for me. I didn't consider good trades outside the strategy (like the injury trade) neither. Nevertheless it's better not showing these numbers anymore. It doesn't give an added value to the blog, and it opens discussions, which are useless. As a consequence I erased them.

In general I don't like it, when people judge me, without knowing me. Cassini didn't recognize the sense of the blog. Obviously is an up and down with mistakes and changing opinions. If I would be a settled trader, I don't need this blog or where are Sultan, Mark and all the guys, which made it? To learn from mistakes and share ideas, exactly this is the sense of it. It helps to have feedbacks like the ones of "Unknown" and is just poor to read posts like the one of Cassini. Yes, destructive feedback is not welcome. It doesn't help and so I ignore it.

I don't need suggestions like "Martin should focus on his day job, and walk away from betting / trading altogether". Even the best trader made mistakes in the beginning. Beside Cassini himself had not the best times lately. I don't give him the advice to retire. Perhaps trading is just a hobby beside his normal job (like it is for me at the moment), perhaps he just had bad variance. Live and let live...

Week 3 in review

The week is almost over, so it's time for the weekly summary. At Monday I started my new job. Obviously the focus was on it, and the trading was not that dominant like before. The beginning was delightful. I hope that the new job will have in the long term a positive influence on my trading results. The financial stability will be a lot higher than the last 18 months, where I just worked 50%.

Short term the 100% activity as en employee had a negative impact on my trading results. I traded less, and when I was on the ladders, I was exhausted and impatient. After a bad day, I blew almost 70% of my bank. I couldn't keep the discipline. After that event I decided to trade with a very small bank of 100 Euros. It's sufficient for the stakes I am working with. I swore myself that there will be no more deposits to Betfair in the future. As a consequence I only can scale up with an organic grow of my bank. With other words, I have to go the hard way with 100 Euros to a considerable five digits amount. That's the reason, why the capital on the right side is a lot smaller than some days ago... on the other hand the ROI is looking better, because the new base is just 100 Euros.

I recognized that there was a small mistake in the strategy, which had a bad consequence. In my approach I make something like averaging down the entry price. In the past a trade was more lucrative, when I won it after the second entry. Now I adjusted the strategy in the way that it doesn't matter, if I win the bet with the first or second position. It has two advantages. It's easier to win with the second entry and the risk/reward-ratio is better. Beside I decided to take a bit more risks. As a consequence the hit-rate will be lower, but the pressure to win "every trade" is smaller. In general I will risk one tick to win one. Before it was the half. With this change I adapt more the principle: "Let the greens run and cut the reds."

Without considering the accident, which cost me a medium sized 3-digit-amount, the week was okay. Obviously I couldn't make a lot of trades. I entered the market not even ten times, and the profit was just around one unit.

What will bring the next weeks? I am getting used to the new rhythm with part time trading and working 100% as employee. The USA/Canada tour will bring a lot of opportunities to test the latest adjustments. I expect a lower hit-rate (the mid term target is 70-75%) and a better ratio between average profit and loss. The yield is too good at the moment. With the mentioned parameters it will be somewhere between 10-15%. I think that is a realistic number. So I can't be worried or angry, when the current numbers are going down. In the long term view, I like to compound the profit during a match. Right now this topic is not in the focus. With the mentioned reinvestments, I hope to to refine the yield to 20%+.

Like "Unknown" mentioned is better to update the P+L not every day or week. So it's easier to keep the long term focus. I like this tip, so I will refresh the KPI on the right side just every second week. It will take away some pressure and beside I can save time.

Friday, 7 August 2015

Lack of discipline

It's really hard to keep the discipline with low stakes. Today I couldn't manage it, and I overstaked. Obviously I lost the trade... When some things don't work right during the day, the risk for irrational behaviour is quite high. Today I had some frustrating actions at the stock exchange, and it influenced my tennis trading. I was not patient like the last two weeks. After a trade didn't go the direction I wished, I tried to scalp offline with a high amount. My player started the 3th set with serving, so I decided to hold the trade for 15:0 to recover the five ticks, which I lost while the girls were on the toilet. Everything went wrong: 0:15, 0:30, 0:40, break... Putintseva rised her lead to 3:0, and I closed the trade. Murphy's law, McHale fought back and my initial trade (even if it was without discipline) would be a winner.

Just seconds after I lost the trade, I transfered a big part of my money back to my saving account. This lack of discipline was only possible, because there was too much cash at Betfair. Like you know, I just trade with two Euros... so I don't need a bank of 1'000 Euro! It only gives you the possibility to make bad moves, which you regret afterwards. Now I have a bank with 100 Euro, which is more adequate to my stakes.

What else I changed? I recognized that not all the strategies have a low risk profile. Two of them are back strategies. When you enter the market too early, the trade can go very bad against you. Sometimes is tempting to back the favourite after he lost the first set, but if he/she continues to struggle, the position has a very bad leverage. With lays under 1.10 you can't make much wrong. The liability in comparison to the possible profit is very low.

It's normal that you have setbacks in my stage of a trading career. It's not the end of the world, if you make the right learnings out of it. The financial damage hurts, but in the long term these kind of experiences help to improve. Even the best traders made mistakes before they succeeded. It just shows that I am not over the mountain yet. I will try to fight back, obviously not with chasing losses, at the weekend. I will keep the KPI on the right side unchanged, because the mistake happened outside the strategies that I am testing at the moment.

Tuesday, 4 August 2015

Changing conditions with the new job...

Yesterday I started my new job and it couldn't be better. I am really happy and I am confident that I chosed the right company and position. It gives me a lot of financial freedom in exchange to less liberty. I had to consider that my trading is affected more than I thought. Unfortunately not in the best way so far...

Actually you would think that a job gives you financial security, so you can trade with less pressure. Obviously that't true. In this stage of my trading career the stakes and the money are not my biggest issues. If a trade goes wrong, I lose 2-3 Euros, that can't be a factor, which gives a bad impact. It's more the pressure to keep the right track. I hate to fail... so far in my life I achieved the most of the goals I had. Unfortunately trading is one exception, at least until now.

In my case the start of the new job had a bit of negative impact so far. I am really tired after a day in front of the computer. I don't have the same patience, concentration and passion at the ladders like before. Well, I traded just two days since the beginning, but I already can feel it. I am exhausted after 2-3 hours at the ladders, and I like to enter the markets quicker than before. Probably this behaviour is quite normal, because you want to use the limited time in a productive way. The danger of overtrading is just around the corner.

Probably I have to slow down a bit, just make a trade, when I feel fresh and patient. Beside I recognized that the pressure for a high hit-rate is too big at the moment. To be more relaxed to lose the one or other trade, I have to rise the ratio between average profit and average loss (risk/reward-ratio) a bit. Right now my target is 0.4, but 0.5 or 0.6 seems more adequate. It doesn't sound like a big difference, but it has a huge impact on the yield if I can keep the hit-rate more or less stable (-5% would be okay).

Overall the development is still delightful, but I have to take care of the warning signs. In this sense I will go to bed now. Have a good night and keep greening!

Sunday, 2 August 2015

Week 2 in review

To make it short, the week two confirmed that I am on the right path. The quality of the WTA tournaments was not the best, so I executed less trades than last week. I made a profit of approximately 4.5 units (last weeks almost 7) and managed to win 15 trades in a row. This streak is still alive. The strike rate even climbed a bit, and it's over 90% after 43 trades. The yield is stable over 25%.

My long term target is 12% (without compounding at the 2nd stage of the trade, which should have a positive effect --> if not, I will not do it anymore). For this goal I need a hit rate of 80% and a ratio of 0.4 between average profit and average loss. The mentioned ratio is more or less fix thanks the strategy (at least without the impact of the 2nd stage), so I can concentrate on the strike rate.

Obviously it's still too early to celebrate. It's just a good start, nothing more and nothing less. I made this week some small adjustments (about entry levels and staking) which gave me additional confidence.

Tomorrow I will start my new job, so my trading hours will decrease. Instead of the whole day, I can be on the ladders only at evenings (at least we have USA/Canada tour now) and weekends. As a consequence the amount of trades will be smaller. Like I wrote, I will scale up the stakes a first time after 100 trades. Probably this will be the case around the start of the US Open at the end of the month.

I made the following conclusions this week:


  • The liquidity for scaling up (and the courtsiders) will not be an issue with bigger matches and events. At todays final at Hamburg you could trade without any problems with 1000 times bigger stakes than I use at the moment! In average factor 100 is possible for sure.
  • I created a concept for compounding during matches. The big profits are still missing (and overall I lost money in the second stage of the trades), but at least I have now a plan for trading with a green book. I am quite confident that the big profits are just a question of time. In the midterm the biggest greens have to be definitely higher than the biggest reds!
  • Be patient and wait for the right matches. Trading is a marathon and not a 100 meter sprint. 
  • Only trade matches, where you know both players. There are enough opportunities, you don't have to enter a challenger tour matchup.
  • Don't over analyse the trades! This is an input of a blog reader, thanks for that.
  • Don't hesitate too long. Often a great opportunity occurs only once. 

Probably the update interval of the blog will slow down a bit. It's difficult to find the time for writing beside a 100% job, daily routine and trading. I try to keep at least a rhythm of one post per week.

Thursday, 30 July 2015

Scale up

The headline says it, I am thinking about scaling up. Not yet, but I am planning a smooth increase of  the stakes while I am still testing the system. It's better to rise the liabilities step by step and not from one day to the other. Of course the sample size is still to small to be sure about the edge, but the confidence is growing. It's not that you can judge a strategy after 1000 trades and with 999 trades not. It's also a smooth development, and I never traded so consistent before.

When I am still on the track after 100 trades, I will double my stakes. It's not a big jump, it will still be micro trading with a risk less than five Euros per trade. If the success story continues, I will be after 1000 trades at the level I like to reach (in a first stage). I expect that I need around one year to be there. It will be factor 100 in comparison to todays liabilities. I kept an eye on the markets last days, and I am quite sure that the liquidity will not be a big issue at the most tournaments for 100 times bigger stakes. We are talking about 200 Euros and not about 1'000 Euros or even more.

In general I am very happy about the development. It's getting easier to spot value (How in the hell Kudla could be 5.0 after he was a break down against Sock?! I saw him even as a pre game favourite...), and I am really comfortable with the strategy now. The biggest issue is still riding the "green waves". Despite I was confident about Kudla, I just made 1.07 Euro profit. It should be at least two Euros (even with hedging after the first set). Well, it sounds not a like a big thing, but with higher stakes this is a huge difference, which you can't afford in the long term.

I don't like to complain. Two weeks ago I would agree to this development without any hesitation. Of course it's still micro trading, but the procedure is (almost) the same with higher stakes. The only thing which I am worried about is the variance. It can be that I am only on a good run. The hit rate is really high (almost 90%), and I doubt that I can keep this number. 50% would be just random like at the casino. I think a number between 75% and 80% should be possible with this approach.

Unfortunately I can't do any backtesting, because I trade manually. When I consider a game situation as value I enter the market, if not I stay out. It can be quite boring, the most of the time I am just waiting for the right moment. Well it seems not a bad approach, I heard from some professionals that trading can be dull. Is a bit like in the army. Waiting, waiting, waiting and then running like hell and have stress. Fortunately I have a lot more fun at the tennis ladders than I had in my time as a soldier! :-)


Wednesday, 29 July 2015

The calm before the storm

I am a bit disappointed, the TV coverage of the biggest tournament this week at Hamburg (500 series) is quite poor. They only show the matches on the centre court. Beside I prefer to trade the WTA tour, and this week we only have low quality tournaments. It's not that you need Novak Djokovic or Roger Federer to trade, but when you don't know the players, it doesnt' make sense to get involved in the action. I would say that I know most of the players ranked inside the top 100 and a few lower ranked up to 200. Beside Jelena Jankovic (WTA 25), which plays a very small tournament in China (together with a lot of unknown Asian players), Anastasia Pavlyuchenkova (WTA 42) is at Baku the highest ranked player on the courts. At least it has the advantage to know new players.

The ATP tournaments have higher quality, but like mentioned, the TV coverage could be better. Beside we have to wait for the more balanced matches, which are normally better to trade, until the round of 16. At Gstaad we saw in the first round like expected (excluded Haase vs. Granollers) very one sided matches. Atlanta is difficult to trade, because on hardcourt (at least with bad returners at ATP) the matches are often dominated by serve. At Hamburg high quality matches like Fognini vs. Chardy or Monaco vs. Gulbis were not shown on TV. On the other hand you could watch all the matches at Atlanta, for example Jared Donaldsson vs. Somdev Devvarman.

Well, I don't like to complain. Soon the USA/Canada tour heats up with tournaments at Washington, Montreal (girls at Toronto), Cincinnati and later the US Open will take place. It's perfect for me, because I can trade after work.

For the above mentioned reasons I didn't trade much this week. Okay, it's just Tuesday :-). I made five trades, and I am more or less breakeven. I updated the strategy guide, now we already have the version 4.0. It's funny to compare it with version 1.0, which was more or less a copy&paste of Sultan. Now I developped my own style of trading, and it seems that I am on the right path. The fine tuning is not finished yet (just today I made a small adjustment again), but the big picture is done.

The next days should bring more balanced matches at Gstaad and Atlanta. Probably also the one or other match at WTA is suited to trade. If not, I will not be (much) in action like a lot of high ranked players... We can say, it's the calm before the storm (in USA and Canada).

Monday, 27 July 2015

Strong first week with the new approach

Since eight days I trade with a new approach. Like already described, I shortened the timeframe, which I am involved in a trade. Obviously it's easier to make 1-2 ticks per trade as 20. As a consequence the hit rate rised.

I made exactly 25 trades (not positions!) so far and only lost three of them. One time I had ten winners in a row and the current streak is even eleven. I am really happy about these numbers. They are well above what I expected. I managed a yield of 27.7% and earned almost seven units. Of course I know that the sample size to judge a strategy and my trading skills are too low. With this pace (25 trades a week) I need at least half a year, better a whole one, to prove the edge.

Overall the following things were positive:

  • Discipline: I start to accept losses. To close a red position is part of the game. Beside I stopped to chase losses. The money management with very low liabilities is accepted as well.
  • Hit rate: I couldn't expect 88% right picks. It speaks for a good selection process and decent entry- and exit-levels. Long term I try to have a value between 75-80%.
  • Risk/Reward-Ratio: The biggest profit was higher than the biggest loss. In average the profits are lower than the losses. Nevertheless the ratio (0.6 after commission) is better than expected. In the long term I would be happy with 0.5.

To improve I have the following points:

  • Hesitation: On one side the hit rate is fantastic. On the other one the amount of trades could be higher. I missed some opportunites (of course I also avoid bad trades), so the overall profit could be higher.  
  • Compounding: After I created green books I often destroyed (a part of the) profits. I guess that I gambled too much and didn't pick the value. It also could be bad variance. If you like to ride a longer swing, it needs more to succeed. Overall I had no clear plan to manage the greens. 
  • Speed: Sometimes I was too slow to green up. In generall I see here a problem. While the games are played (not in the breaks) the courtsiders often offer only bad value. The liquidity - which you need to hedge the trade - is not available. To be honest, this point can be critical to scale up the strategy... I will keep an eye on this issue, perhaps was also a problem of the tournaments size. Last week no big event was played.

In general I am very happy about the first week. It's still a long way to go, but the first step is done. The following week will be the last one as hobby full time trader. At 3th August I will start my new job. The quantity of tournaments (Hamburg, Gstaad, Atlanta, Baku, Florianopolis and Nanchang) will help to continue with the intense testing of the strategies.

On the left side you can see my trades. There are small differences to the KPI. First I didn't count the (big) profit from the injury bet. I wrote about it. Second I don't consider scratched trades (-0.10 to +0.10).


Friday, 24 July 2015

Managing profit expectations

One of the common mistakes of novice traders and bettors are too high expectations of their profit. I can remember that a guy offered me a ROI of 35% (a month)! Even without compounding you would make - on a yearly base - a profit of four times your bank. Let's say you have 50'000 Euro on your account, this means you make an income of 200'000 Euro a year (without considering the commissions). It sounds delightful, but it's not very realistic.

One of the most famous and successful bettors (he earned millions with betting), Patrick Veitch, made an ROI of 16%. Yesterday we talked about tipster services. Most of them offer unrealistic profits, which they never can deliver. A very good trader/tipster makes 3-4 units a month (let's assume that one unit is at most 2% of your account... so it's 6-8% per month). You also have to consider the yield, the ratio between the stakes and the profit. A long term yield of 10% is not easy to reach. Let's say you risk 500 Euro, which is equal to 1% of your bank, per trade (in smaller tournaments here already start the liquidity problems), you earn in average 50 Euro. If you make 100 trades a month (a realistic number as a tennis trader) your profit will be 5'000 Euro. So you would make a ROI of exactly 10% a month. To be honest, I think this is still quite a high target and a very impressive performance.

It shows that you need a realistic target settting. If your expectations are too high, you will not succeed. You will always search for a system, which doesn't exist.

At Sunday I will take a look on the performance of the first week with the new approach. Managing expections is definitely also a topic I have to consider. Or how Conficius told: "It does not matter how slowly you go as long as you do not stop."


Thursday, 23 July 2015

Fixed game at challenger tour!

Just read in a forum that the Kazaks (Golubev and Nedovyesov) fixed their match (fixed match) at a challenger tournament in Netherlands. Golubev won the first set with 6:2. So far, so good. While he hold his serve in the second set without any problems, the odd drifted away. He started the 2nd set as a 1.26 favourite and was trading at almost 3.00 at the score of 6:2, 4:4 (see the chart on the left side)! Like planned, Nedovyesov won the tiebreak of the 2nd set and later the match...

It seems that the world number 95 (Nedovyesov) and 156 (Golubev) don't earn enough as tennis professionals.

This is one of the reasons why I don't trade challenger tournaments. Nevertheless I am a bit shocked, how players around top 100 ranking can do that. That's a behaviour without any sportsmanship. Unfortunately nothing will happen. For me these two Kazaks are just stealers and cheaters. They definitely found a place on my "wall of shame" beside Ulas Agzikara (the scammer). Fortunately I was no victim this time. All the backers of Golubev were stolen today, what a disgrace!

Here you can even find a longer summary of the story: How to fix a tennis match (twice!)

Well life goes on (for me and the ones which lost this bet)... as a conclussion: Never risk too much with any trade.

Tuesday, 21 July 2015

Standard deviation

Tuesdays are the busiest days at tennis ladders. The tournaments heat up after a slow start on Monday, where normally only a few matches take place. It's really difficult to keep the overview. Especially at my stage of the trading career. I am still looking for an edge, so it's important to keep an eye on as much as possible matches.

I am thankful to get some extreme scenarios this week so far. Yesterday we had the injury of Anna-Lena Friedsam (she hurted the ankle), today we saw some very one sided first sets (0:6). In this case the favourite (Pironkova) only won six points in the first set! It's good to have matches with standard deviation. So you can see if your system works under windy conditions. In sunshine every strategy brings profit.

I learned today that you have to expect the worst. Your strategy has to be enough robust to pull through extreme scenarios. You can't take the average outcome as a base. I had to make a small adjustment. Probably my hitting rate will be a bit lower in the future (6-0 W-L looks nice indeed!), but on the other side my single profits will be higher. After this change I was able to make my biggest profit so far (2.20 Euro at the match between Giorgi and Cibulkova). To be honest, I was a bit lucky. I couldn't trade out at 1.40 (suddenly the liquidity was gone), so I did it at 1.45. This difference almost doubled the profit.

I am still mainly working on the first set trading (without much compounding). Trading is really complex, so you have to divide the different stages of a tennis match in small (trading) pieces. Right now my focus is on scalping. Caan Berry wrote once again a nice article: Betfair trading strategies
It's about your own behaviour. I found out that for me quick in and out trades suit better than mid- or long term swings. If I can handle the short term trading, I can start to think about compounding. Lay low odds are powerful, every trader knows that. With green books this is the way to go, but I will take step after step.




Monday, 20 July 2015

Live pictures are a must!

That's why you should never back 1.01 or trade without live TV pictures. Anna-Lena Friedsam was 6:1, 4:0 ahead against Klara Koukalova. There was absolutely no chance for a comeback for the Czech player. She was completely outplayed.

Unfortunately Anna-Lena felt down (to be honest I didn't see it). She was screaming like hell. I was sure that this is something serious. Betfair has the rule that the bet will stand, when at least one set is completed. I was surprised how much money was still available to lay Friedsam for odds far under 2.00. In the beginning even for 1.10 and below... So I layed her for quite big money (at least in comparison for what I am trading right now). In the end I made almost 50 Euro profit with not much risk. It was obvious that she hurted herself really serious and I could hedge my profit without any problems. Friedsam had to retire (I hope is not too serious) and all the money on her was lost. I could even go for a bigger profit (without a hedge), but in the end trading is not gambling.

What is the learning of this story? Never back 1.01 (an injury is always possible) and never trade without live pictures. On the other hand you can make money with these kind of things. If I would be quicker (I lost the concentration on this match at 6:1, 4:0), I could fill my boots even more.

This profit gives me some room for a possible downfall. I will not count them to the profit&loss that I show on the right side. It's a different approach, whichs works perhaps one or two times in a year.



Sunday, 19 July 2015

New setup is done!

Sooner than expected I returned to the ladders. The main reason is the time. In two weeks I will start my new job, so my schedule will be pretty busy. Like Big Pairs, indeed a very nice blog (Big Pairs), I will be forced to share my time between work, trading and other hobbies. Right now I have not much other things to do. Of course I could sit at the lake, but without any effort you will never be a successful trader. Nevertheless I don't have the plan to work as a full time trader like Big Pairs wants to do. For me trading will remain a hobby. Hopefully a lucrative one, but as a single source of income I don't see it anymore. There are too much disadvantages, which I discussed some weeks ago.

I made some major adjustements at my trading approach. The biggest changes are the following ones:

  • Smaller Stakes: Once again i set the clock to 0 (I really hope that's the last time)! Yesterday I started with a bank of 1'000 Euro. The common trading rule says that you should not risk more than 1-2% of your bank per trade. In my case that would be 10-20 Euro. The past showed that is too much. A bad run of trades give you a bad feeling, and you lose the trust in the strategies. To reach a sample size which is big enough to judge a strategy (something like 1'000 trades), I decided to trade with only 1-2 Euro risk. If the system works, I can scale up without any problems by factor 100. So it's quite easy to see, what could be possible (just erase the comma... cents could be Euros :-)).
  • Shorter timeframe: In the past I stayed often too long in a trade. Sometimes I was 30-50 ticks in profit, but in the end I lost. I decided to trade shorter periods, but with more positions.
  • Lower Risk-/reward-ratio: I was too focused on a positive risk-/reward-ratio. There are different trading styles. Some traders risk 10 ticks to make 20. Other people risk 100 ticks with the target of winning one. In the end it has to suit your preferences. I prefer a higher strike rate, so my single position can't go for the jackpot.  

For the moment I will trade with these very low stakes. If is possible to double my bank with this strategy (from 1'000 to 2'000 Euros) I will rise the stakes by factor 10. Ten time bigger stakes would be an appropiate money management for my current bank (risk 10-20 Euros with a bank of 1'000 to 2'000 Euros). At the moment testing is more important than the P+L.

Yesterday I started with the above mentioned parameters. With two successful trades I made a profit of 1.14 Euros. It doesn't sound very impressive, but with factor 100 we would cooking... Good things start small. Let's see what's possible. Right now I feel again a lot more confident.

Friday, 17 July 2015

Taking a small break

The title says it. Since my return from the holidays, I totally lost the focus and trust. Every trade is wrong, I think I am on a 0:10 run or something like this. I can back the favourite, when he/she is trailing or go with the underdog, everytime I am on the wrong side. Perhaps it's a lack of game reading, perhaps it's bad luck. I don't know. I am out of words. Unfortunately I don't see any edge with my tennis strategies. It's just pure gambling with good and bad runs. No wonder, the tennis market is really mature and efficient. I still think that's possible to make money with tennis trading, but you have to act smart and find your own way.

Right now I am trading with a midterm approach. In average I stay two or three games in a trade. I start to feel that this is too long. Today I was 30 ticks in plus, but in the end I lost the trade. That is quite stupid in my opinion. It shows that a more active trading makes sense. A commentator mentioned that he makes around 80-90 trades during an NFL match.

I have to look for a different approach. I have an idea, but I have to test it with small stakes. Even the mentioned 20 Euro are too much at the current stage. I will take a break for some days to refocus. I will keep you informed. Have a nice weekend!

Wednesday, 15 July 2015

Post holiday depression...


Welcome in the reality! My trading before the holidays was quite decent, Wimbledon and the tournaments before I was always in profit. Today I had a terrible return to the ladders. Nothing worked, I made five trades and all ended with a loss! Thanks to the money management I "only" lost around 6% of the bank.

Well it's normal that traders have good and bad runs, but today I asked myself (like in old times), where is the edge? We had the discussion with Cassini. He has the opinion that there is (almost) no chance for a hobby punter with an average internet home access (no courtsiding) and normal information to make money. Okay, it's just one appreciated opionon of many, but my sceptism is coming back. Is it really possible to make money from home (against the big fishes)?

I am happy not having the pressure to earn my money with trading. It's really frustrating to have these kind of days. If you need the money for covering the daily expenses, it can be really stressful. 

I don't know the exact reasons for today's failure. Was it bad variance? Was ist overtrading? Was it bad knowledge? Was it mix of all? It's difficult to say with just five trades. You need a big sample to judge strategies and your trading level.

Well, I recognized that my stakes are still too high for not proved strategies and knowledge. Obviously you can't earn big moeny with low stakes (and the opportunity costs are even higher), but for testing the strategies is better. I didn't lose a fortune, but it's still too much to be not angry and disappointed. 

I talked about scaling up the stakes if the strategies work. Thanks to the great liquidity at tennis markets this would not be a problem. I decided to lower my stakes by factor 5 (max risk per trade 20 Euro). For learning and gaining trust, it's unfortunately the only way. Sultan talked more than once about this topic at his road to become a successful trader. First you have to trade consistent, second you can rise the stakes. 

Let's see if I can make profit one day. If not, it's not the end of the world. In 2 1/2 weeks I will start my new job, where I earn good money with less stress. I see trading as a hobby, it's a a great competition against other people. The minium target has to be not losing money!

Friday, 3 July 2015

No more pre game trading

The pre game trading was one of my strategies. Unfortunately it didn't work well. Actually I think it could be a nice niche market, but you can't do it just beside the inplay trading. Normally it's a lot of psychology in the offplay markets. Especially not experienced bettors have the tendency to back the big favourite (against every logic of value). After a loss with Stan Wawrinka, which I hoped to solve inplay (unfortunately it didn't work, I would categorize this trade as a small lack of discipline), I decided to stop with these kind of trades. I don't see a real edge, at least not without a big focus on the offplay market.

I didn't count this loss to my profit&loss statement (exactly -100 Euro), because I will not do this approach anymore. It's looking like an excuse, that's true. Probably I would count the profit if I could turn the trade in a winner. I am honest about this issue. You see, never believe a profit&loss blog ;-). I would not consider my blog as one of these categories. My figures (on the right side) are just shown to keep my focus and my discipline as high as possible. If there are a difference to real Betfair statement I will mention it like today. I don't like to lie about my numbers, there is no benefit for me to do that.

If you don't count the mentioned trade, I had a successful day. Nevertheless it was not that good like it should be. There were a lot of missed opportunities, once again... Unfortunately my focus drifted away after the lost trade with Stan Wawrinka. It never helps to start bad in a day. A professional trader has the mental strength to forget a loss in one second. He knows that his strategy works and there is a long term edge on his side. I am still not sure about it. The results (without the mentioned mistake) of Wimbledon are looking promising. I made over 150 Euro, what I also did in the weeks before. I know that the sample size is too small, nevertheless I am happy about the progress. Step after step I find my own way to trade. Below you find my profit&loss statement for Wimbledon. When you substract the mentioned trade of Wawrinka and the outright bet on Rafael Nadal (it was more fun than real believe) is exactly the value shown on the right side.

In summary Wimbledon was not my breakthrough, but a step in the right direction. I still make too much mistakes and miss opportunities which I shouldn't. Beside I take too often bad value.  

Tomorrow I will travel to New York. I just recognized that the 4th July is a special day in the USA. Let's see if there are some activities around the Times Square, where my hotel is. I think it's the right moment to take a break from the ladders. The last days were intense and like wrote yesterday, you have to consider the opportunity costs, which are quite high. After the holidays I will trade some smaller tournaments. The nice thing about tennis trading, there is always a tomorrow with new opportunities...

Thursday, 2 July 2015

Opportunity costs

Cassini mentioned it some days ago, as a (part time) trader you have to consider your opportunity costs (Opportunity Costs). The time you spend in front of the computer is worth something. Especially at a sunny day like today, there are better things to do as staring to a TV and computer screen. Beside is almost impossible to keep the focus while trading, when it's over 30 degrees Celsius in the room. Unfortunately the most flats in Europe have no air conditioner...

For me the used time is an investment in the future. I take a one month break before I start a new job, so it's a rare opportunity to make an intense testing of my strategies and trading skills. Beside I will make next week "real holidays", when I travel to New York and Bahamas. So I will not lose all my time in front of screens... one disadvantage of tennis matches are the playing hours (at least, when the ATP and WTA are in Europe and and the matches are played during the day). I really look forward to the automn, when they play overseas, and I can trade in the evenings. It's better for the time management, and beside it's not so hot anymore in September.

Despite the heat I spent like seven hours at the ladders. I made just three trades. One was a loser, one was scratched and one was a winner. The profit for the day was 40 Euro. So I had an hourly salary of six Euro. I would call it a decent wage for Africa... :-)  Without joking, it shows the mentioned topic about opportunity costs. I don't like to sound too negative, in the end is a hobby and it's not lost time for me. Especially when I can scale up the profits one day. I am quite sure, that factor 10 would be possible without any problems (at least at Grand Slam tournaments). 70 Euro an hour would be quite okay and equal to a good paid job in Switzerland.

Tomorrow will already be my last trading day of Wimbledon. Like I mentioned above, I will travel for one week to oversea. Of course I am happy about it, on the other hand I never followed a big tournament that intensive like Wimbledon 2015. So it would be also nice to finish what I started...

Wednesday, 1 July 2015

The right timing is essential...

If you count the profit of the match between Keys and Vögele (which started yesterday) to today's profit&loss statement I had a green day. If not, I had a red one.

Today I was always a step behind the market. I hesitated too long and missed some opportunities (especially the comeback of Baghdatis against Millman). The day passed by, and I became impatient. When you lose your patience, the mistakes are just a question of time. Unfortunately I traded a poor value with a too early lay against Mattek-Sands. I don't tell, that you couldn't lay her, but my timing was poor, and I executed a wrong strategy.

I was thinking again about my favourite topic, the key performance indicators of trading. :-) I am not so sure if is possible to reach a 1.00-ratio of average profit in comparison to average loss with my strategy. Perhaps when one day a really huge (four digits) profit will come, but when you calculate the median it's probably impossible. I am more the "in and out trader" than the one which hold his position until the end. Like somebody mentioned in the comments, you have to consider that you also lose a lot of trades if you let them run until the end (for example today with Sara Errani). Well, in the end this ratio doesn't matter. The only thing which is important, is the net profit (in comparison to the risk --> ROI or yield).

I made a small adjustment at the exit of a trade (redding strategy). In combination with my greening, the "Sultan strategy" (take out half of the stake, when is 0:30 or breakball against your player) it doesn't make sense. For example:

You lay 1.25 with 200 Euro (risk 50 Euro)
You back 1.10 with 100 Euro (-10 Euro risk)

Perhaps this approach worked some years ago, but now it's too late to halve your stake at this moment. After 0:30 (and a break and set down) the big price movement already happened. Even with taking out half of the stake, you lose 80% of the initial stake. On the other hand, you lose 50% of the stake for a possible comeback...

I give away a bit of the profit with breakpoints for my player. Most traders are waiting for a converted break. I prefer to play more save. Obviously this difference has an influence on the average profit against average loss-ratio. If you wait for a rebreak, your strike rate will be lower, on the other hand your average profit will be higher... I think is a personal preference, how you manage the profits and losses. More crucial are the right timing at the entry!

Like I wrote some days ago, serveral ways go to Rome. Let's see if my strategy with a higher strike rate and a worse average profit/loss-ratio can work.

Decent start at Wimbledon

One day after the tennis players, I also started to my Wimbledon adventure. I would call it a decent beginning. How you can see at the right side, I ended the day with a 4:2-record and a profit of 36.70 Euro.

I traded mainly WTA matches. The first of the reason is the duration. "Best of five"-matches take too much time. Second I don't have much experience with the charts. The volatility is different than the one of "Best of three"-matches. Last, but not least, the women's matches bring normally more momentum changes (which are the base of my trading style), because of the weaker serve.

The first week of a Grand Slam tournament is always very busy. It's difficult to keep the overview. I am more focused on the scoreboard than on the action on the court. The opportunities are often coming at courts, which you don't follow at TV...

The match between Madison Keys and Stefanie Vögele was suspended because of darkness. There I have a sure profit of over 80 Euro. Together with the 36.70 Euro I mentioned above, I can be quite happy about my first trading day at Wimbledon.

Of course not everything was perfect. I missed some good opportunities und took on the other hand at least one gamble. I had to think about a quote of Dr. Alexander Elder:

"Amateurs look for challenges, professionals look for easy trades. Losers get high from the action, the pros look for the best odds".  

When I layed Bacsinszky (against Goerges) I didn't follow this quote. Definitely it was not an easy trade, because I went against the big favourite and the momentum. The other lost trade was okay. I was surprised, how easy I could accept that my idea was wrong (I expected a stronger Paszek). I closed the position and lost only six Euro instead 30-40 Euro (what would probably happen in the past).

Tomorrow is again a day with a lot of action. Hopefully I can take over the positive energy. Before going to sleep I will make my preparation for another busy day on the ladders...

Saturday, 27 June 2015

Let's set the clock to 0...

The last weeks I made almost sixty trades and ended with a profit of over 150 Euro. You see these numbers below.

In the beginning I traded with higher stakes and slighty different strategies. Today I finished the tennis guide, version 3.0. It will be the base for Wimbledon and the upcoming tournaments.

To make the trades comparable, I have to set the clock to 0. If I would continue with the KPI on the left side, I would compare apples with pears. That would give a wrong picture to analyze my trades.

Like I wrote in the past, the strike rate will probably be worse in the future. On the other hand the ratio between the average profit and the average loss will be better. Right now I have one of 0.42 (22.34 / 52.37). This means that I have a lot pressure to generate much more winners than losers.

It's difficult to forecast the future ratio, but it should be near 1.00 or even above. If you are capable to reach a ratio of 1.00 and a strike rate over 50%, you make profit. The nice thing with trading tennis is the fact, that you can scale up your stakes without any problems (when you trade consistent profitable).

Yesterday and today I managed to make profits thanks to Sam Querrey. Yesterday he was one set and one break down against Dolgopolov and today the same happened against Istomin. Today the trade was not looking good, when the Uzbek served at 7:6 and 5:2 (later again at 7:6 and 5:4) for the match. Fortunately he struggled with his nerves and couldn't finish the encounter until the tiebreak. Like Bencic (against Radwanska) he won today his maiden title on the main tour. The profit of Querrey and the small loss with Bencic (I expected a similar scenario like with Istomin) showed that the ratio changed. While I won with Querrey 45 Euro, I lost with Bencic only 19 Euro. Of course it needs a lot more matches to have a big enough sample, but I have the assumption (and this is equal to my target) that the ratio will be in the future over 1.00, on the other hand the strike has to be at least 50%.

The biggest loss should not exceed 100 Euro. If it happens, it's a lack of discipline. This is also a reason to set the clock to 0. In the future these big losses are not allowed anymore! If this happens again, I have to stop with trading... without patience and discipline, you will never be a successful trader.

So, I look forward to an interesting tournament at Wimbledon. Hopefully the next week (the second week I will miss, because of holidays) will confirm my progress.

Friday, 26 June 2015

Cutting losses and running profits

Wimbledon is straight in front of the door. Today was quite obvious that the players focus on this main event. In four half finals we saw two withdrawals. Baghdatas retired after a 2:1 lead against Istomin, Wozniacki (0:3) also played just three games against Bencic. Beside Makarova not even started her double match.

The played half finals (Dolgopolov vs. Querrey and Radwanska vs. Stephens) brought some roller coaster charts. The women's match didn't take my attention. Aga won the first set and was the most time in control of the match. I didn't like to bet against her (despite some value was on Stephens), because she is the more consistent player of them. Dolgoplov can beat on his day almost every player on the tour. On the other hand he also can lose against everybody, when he is not in the mood. I don't trust him that much (despite he brought me a good profit against Andujar this week), so I layed him when he was a set and break up (6:4, 1:0) against Querrey. The trade was matched at 1.08. The big US guy fought back and won the match an hour later with 4:6, 6:3, 7:5.

I could manage a big profit (over 1000%!), when I would have the balls to stay with Querrey. What did I do? I made "just" 100%... Here starts the topic about profit taking again. A rule says to let the winners run. Unfortunately you don't know in advance, which trades are the winners. To be honest, I think is a lot easier to cut the losses than let run the profits. I found an interesting article about this topic: https://betting.betfair.com/betting/other/cutting-losses-and-running-pro-291107.html

Trailing stop losses is an interesting instsrument of the stock exchanges. I think it works slightly different at sport markets, because they are more volatile and have an end. There are very big moves when a break is in sight. Nevertheless I like this idea. Often a player which made a break and confirmed it, gained the momentum. So it would be pity to hedge too early. It takes time until a 1.08 lay brings the big money. Normally it needs a second break (turn a deficit with a break in a lead with a break).

Probably I was a bit too cautious with Querrey today, because I lost this week some free bets. I recognized that you need also with greening an idea before the match. During the trade it's very difficult to control the emotions. Most people tend to go for the save profit. In the long term is probably not the best option, because you don't consider the value concept.

As a learning I defined four scenarios (before the match starts):

  • No more greening (a bit of risk I reduce already at breakpoints... It's a kind of tick scalping)
  • Take out 1/2 of the stake
  • Back the leader (all the profit on the player I layed before)
  • Split the profit

The first point is a personal preference. I know that a lot of traders are waiting until the break is confirmed. Often the server rises his level, when he is 0:30 down or has breakballs against him. So I prefer to hedge some green when a break is in sight. Especially three missed breakpoints in a row kill you. I prefer to take a part of the profit than playing like in the casino. In my opinion the risk-/reward-ratio is fine with my approch, because I can work with green books and compound the profits. If a 0:40 turns in a red book, you often lose this trade. When I feel confident that this lay can go the whole distance, I will not hedge anymore. If it turns against you, you can close the trade later with a break even result.

Take out 1/2 of the stake brings you in an all green position which gives you a small profit, when the initial layed player wins the match. Back the leader means that you are going with the strong favourite, which is still ahead with one set. Split the profit is the best way, when you have no idea in which way the trade will go. With this scneario you can make a decent profit (like me today), but you will never make a fortune...


Thursday, 25 June 2015

Last preparations for Wimbledon

Last two days I invested a lot of time to find ways to be better prepared for a trading day. I developped a spreadsheet, which helps me to forecast the matches. Beside it's a great support to control the emotions during a trading session. Now I know in advance, when I enter or exit a market. Only in rare occacions - when my game reading tell it - I will change my initial idea.

Beside I made a final decision to lower my stakes. I already had this idea before, but I didn't change it yet. This adjustment gives me more opportunities to enter and re-enter markets. Without this step, I don't have room for maneuvers after the first (lost) trade. Often a second opportunity is coming during a tennis match. When you already shot the whole powder before, there is no more possibility to turn a bad trade in a good one.

I am well prepared for Wimbledon. The main draw of the tennis highlight of the year will start next Monday. The only part which will be strange for me is the "best of five rule". The last weeks (except Roland Garros which I didn't rade) the players only had to win two sets for a win. Fortunately the women - which I definitely prefer to trade on grass - play also at Wimbledon "best of three". Unfortunately I have to work on Monday (and will be the second week of the tournament in holidays), but I am sure that this big event will show if I am on the right track.

Tomorrow the half finals of the tournaments at Nottingham (ATP) and Eastbourne (WTA) will take place. Especially I am excited about the match between Belinda Bencic and Caroline Wozniacki. So far the Swiss played a super tournament, but Caro is another number than the opponents before. If the 18 year old can win this match, this would be the biggest success in her career. What I saw so far, this is not impossible. Nevertheless my favourite to win this tournament is Radwanska. In her last two matches she lost just seven games (against Pliskova and Pironkova which are definitely no mugs!) Would be delighting to see a final between Belinda and Aga...

Tuesday, 23 June 2015

Lay 960 busted!!

What a match beween Gilles Simon and Marcel Granollers. With the own serve the Spanish player was 6:4, 5:4 and 40:0 ahead. At this moment Simon was trading at 960, and somebody traded a lay for 50 Euro. This person took a risk of 48'000 Euro to win just 50 bucks. I never would do this, tennis is just too inpredictable. On the other hand I am waiting for the moments to find these kind of back opportunities... Well I would not do it with my own money, but with green books. Unfortunately I didn't see a good moment to enter this match. Nevertheless I hope the days will come, where I can go for these big wins. You only need one or two of them (even with greening) to have a superb year. This is one of  the principle of the strategies. With the (big) profits you should make the difference. The small reds and greens should offset.

Simon vs. Granollers (23.06.2015)
My trading day was an up and down. I started with a mistake which cost me 48 Euro. Afterwards I had bad luck that my free bet on Ferrer didn't work. The same problem i had later with Safarova. Instead of a decent three digits profit (when Lucie would take one of her felt 100 break chances), it ends with 10 Euro. The worst loss (almost 100 Euro) resulted from the match between Madison Keys and Belinda Bencic. Nothing to blame, it was bad variance. I never saw Bencic so strong at WTA level. She served amazing and the length of the ground strokes was just fantastic. In the end she won 6:2, 6:2 against a player, which she lost a month ago at French Open 0:6, 3:6! The biggest profit (something over 100 Euro) I made with the first set comeback of Dolgopolov.

Overall it was a good day. I was prepared and knew what I like to do. Mostly my ideas worked. It would be a decent profit with a better variance. Ferrer and Lucie both lost as favourites in two sets, that is not often the case. In the end of the day I was exhausted and missed the one or other opportunity.

Beside I could make a clarification about the entry levels. You have to decide if you enter during a game or just when its finished. I decided to make two rules. There are big players (like Djokovic, Federer or Williams), where it can make sense to back them at a crucial score (for example 4:5, 0:30). They have the mentality and skills to fight back. If you don't take these opportunities, they will often not come again... On the other hand in more balanced matchups these entries normally doesn't make sense.


Monday, 22 June 2015

Preparation is the key for successful trading!

At the weekend I read once again the strategy guide of Sultan. With my improved knowledge, I had something like an Eureka moment. There are really good parts for advanced traders which I didn't consider in the past. I appreciate the work of Sultan, I was just not happy with his teaching. I think it's really difficult to learn trading with a mentor without having real time sessions and direct feedback of the trades. Well, it's no time (anymore) to blame any people about my past. I learned the lesson that you can't take a shortcut. Nobody sells a holy grail or is willing to help you for free. I would not do it neither, to be honest. :-) In the end all the traders are in a competition. I know now that you have to find your own way. It's a long and tough one, and only the best traders will survive. I hope to be one day one of them.

In the strategy document of Sultan you find good hints about entry levels. In the past I just entered more or less blind after a break or a lost set. Beside I recognized that the preparation in advance is crucial. You need an idea BEFORE the match, what you will do in different scenarios.

I decided to segment the matches before they start in different categories. There are matchups with big hitters, which are normally not good to trade. Beside you find encounters with a strong underdog, which can be an interesting opportunity. Last but not least, you can find typical swing games. Normally this is the case, when is very difficult to pick a winner.

Of course the above mentioned stuff is not rocket science. It's just for me to be better prepared and not lose the control during the trading sessions. Most of the time the first idea (which you have before the match starts) is the right one. During play time is more difficult to think clear. Fear and greed are taking away the focus.

Thanks to all readers! How I recognized, the number of interested people is rising. That shows me that I am also with the blog in the right path...

Saturday, 20 June 2015

I lost the focus...

The trading week ended with a disappointment. After a bad Friday, I lost the focus. It's a common thing and is called revenge trading. You like to win the money back that you lost before, and you are not patient enough. It happened today. The trades were against my gut feeling. I was definitely not in the trading zone. I saw a one sided match between two German ladies (Lisicki and Kerber). Instead of trusting my gut feeling and my tennis knowledge I went against Kerber... Probabaly I would not do this at another day. But 1/2 final days don't have much action. There are only a few matches, you often see not interesting service battles (like Federer against Karlovic).

Yesterday I read an interesting link about trading (it's in German): http://de.tradimo.com/lernen/psychologie/emotionen-einfuehrung/ There is a theory which says that there are three components to be a successful trader: strategy (10%), money management (30%) and psychology (60%). Well, 60% is probably a bit too high, but the control of the emotions is definitely the most important part. You need to handle bad days and start refocused after a night.

Nevertheless I made a minor strategy update. Nothing big, but I recognized that the redding strategy of Sultan (take out 1/2 of the stake at 0:30 and breakpoints) makes sense. When one player is tanking or injured (today the opponent of Seppi was again injured!), it doesn't help much to know where the price should be under normal circumstances. In this kind of scenario the market panics, and you have to protect your bank. With this small adjustment I can go back to the old stakes...

Despite the last two days were disappointing I feel on the right way. Trading is not a one way street and losses are part of the game. For the whole week I am still in profit.

Friday, 19 June 2015

A backfall in old days...

Until the last trade, the day was okay. Then came Gael Monfils, he is always a grab bag. You never know what you can expect. I saw him playing the last days, he often slipped away. Gras is definitely not his prefered surface. Yesterday I thought that this playstyle can end in an injury. Today it happened and I was not aware this time...

I was not concentrated enough and didn't see that he slipped again away. This time he hurted himself. Nevertheless I backed him at 0:4. This entry often has a lot value, but this time the odd was crashing. Monfils was barely moving, and the market paniced (and was right). So my loss after the first set was bigger than expected. I hoped that the french man give up (so the bet would be void), but he started the second set. I made the mistake not to take the loss before. So I lost more than the money management allows...

I wrote in the last days that the results were looking better than my trading is. Today it was the proof that I am not there where I like to be. The discipline is still not the best (in other case I would close the bad Monfils trade before) and the killer instinct is missing. Instead of making a big profit at the match between Halep and Mladenovic (I expected a tight fight), I lost money because of backing the Romanian in the wrong moment.

Nevertheless is not everything bad. I am still in profit over the whole week and the system seems to work overall. Since the start of this blog I have a plus of exactly 250 Euros. In the long term the Monfils game hopefully was just a small accident...

One lesson I learend today (again). The stakes should be lower until the moment you feel 100% confident. Some people even advice to trade in the beginning with paper money. Well, that can work for the one or other, but I think the most important part (psychology) you can't learn with this approach. As a measure I will halve my stakes. It will help to strenghten my discpline, I am quite sure. It's easier to close a trade with 50 Euro loss than one with 100 Euro... The money management stays the same (not more than 1% loss per trade), but the single position will be smaller. This change should give me more opportunities (for example a re-entry) during a trade.







Major strategy update

Yesterday or let's better say today, I went to bed very late. I watched the soccer game between Brazil and Colombia (Copa America). I just woke up before the action began at the tennis courts. Definitely it was not the best preparation for a trading day... I felt tired, without energy and not really in the mood for the ladders.

Nevertheless I started to watch some tennis games and (like often) I missed too many opportunities. When I was really awake, I traded the match between Kiki Mladenovic (she is often good to trade) against Barbora Strycova. Despite a too early entry, I could manage a small profit. Unfortunately the second set was very one sided, so 50% of the money went away.

During this session I recognized that my entry levels are still not ideal. The difference between a break and a confirmed break can be huge (especially at WTA). So I decided to split the stake in two positions. The advantage is an averaged price.

I made a major update of the strategies today. My trust rised with these adjustments. There is only one open issue, it's about profit taking. I am not sure yet if I already found the right mix between reducing the risk and let the profit run. Like I wrote in the last posting, it's also a personal preference. A quick profit taking brings a better hit-rate and a smoother bank development, but you will make less three or even four digit profits. The future will tell what's the best mix. If I recognize that the approach is too conservative, I can change it again. Right now I am quite happy about todays improvements. A big topic (the entry in a trade) is solved.

Tomorrow I like to go back to the ladders. I will sleep more and will have hopefully a better energy level for a busy trading day. Good night!

Wednesday, 17 June 2015

Another green day...

A busy day - with some rain breaks - ended with a profit of 50 Euros. One game is still to go (Pliskova vs. Konta) and will add another six Euros to the bank. The result is looking better than my trading was. I was in some critical situation which shouldn't happen. I already spoke about this topic in the last days, so I don't want to repeat my problems in all the details.








In general you see it at the image on the right side. With my hit rate (82%) I am really happy. Of course I can't compare it with the 40% of Sultan, he has another approach. I only can speak about my strategies. To be successful everything over 75% is fine. The main problem is the average profit. It should be on the same level like the average loss. Unfortunately I couldn't compound my green books. In these kind of situations I was often too careful. I didn't take use of the leverage. When you lay a 1.05 odd it doesn't need much money to win a fortune. Despite one trade with Rafael Nadal, I never managed to win more than 1% of the bank. On the other hand I risk up to 1% per trade. Overall I have to consider that there is a problem with the reinvestments.

Beside I made some small adjustments at the money management. I decided to halve the stake in the later stages of a set.

Tonight there is one more trade (Copa America: Brazil vs. Colombia). Beside tennis I do some small soccer bets. They are not part of the profit&loss statement I publish here. They should give some extra money for my tennis strategies. I am quite sure that the system I developped with a friend together is quite profitable. Unfortunately you don't have much suitable matches. You need teams with high scoring quality and a low 0:0 odd at the correct score market.

Tuesday, 16 June 2015

The five stages of betfair trading

Yesterday I just made one trade, today was full of action. I was again not 100% happy with my trading, nevertheless I closed the day with a good profit.









There are five stages of Betfair Trading: http://www.geekstoy.com/forum/showthread.php?1589-The-5-Stages-To-Betfair-Trading. I am confident that I reached step four. Perhaps I am already near to step five. At the moment I normally have a profit at the end of the day, but the trading is not really smooth. Sometimes I take too much risk, often I am too slow or unsecure. It's still a fight like Carlos Berlocq on the tennis court and not the magic of a Roger Federer. How we all know, Carlitos can win tournaments, but these are rare moments. He fights and makes his income, but all the professionals like to be grand slam winners or at least part of the top10 in the world ranking.

That's the same in my case... I am (hopefully) not a loser anymore, but I am far away to be a Top10 tennnis trader. How far I can go the future will tell. Probably I have not the talent of a Federer, but with hard work you can reach big things (like Wawrinka).

First time since I started with trading, the strategies seem quite stable. I feel comfortable with all aspects like risk-/reward-ratio, exit-points or entries. Perhaps there are small issues with the reinvestment of the profits and the handling with lost offplay trades. I have the feeling that I could take more risks with profits and less with "red books".

Scalping tennis markets

Unfortunately I couldn't trade (much) today. I had to go to the office for a conference call, which didn't take place... (pretty boring, when you are officially in holidays). In the evening I had my weekly badminton session. When I arrived home, there was only one match left: Grigor Dimitrov against Sam Querrey.

After two sets the match was interrupted because daylight was gone. I could create a green book (see on the left side), but I am not 100% happy with the trade. After Dimitrov lost the first set I entered the market (strategy: back the favourite offplay for 2-3 Ticks), but I couldn't enter as quick as I wanted. The risk-/reward-ratio was not good at this moment anymore. If Grigor would lose his serve, I would be in big troubles. What should I do better? When you scalp the markets, you have to be quick. I was too slow with the entry and lost 1-2 Ticks. So I had to risk an inplay bet in a volatile environment.

To go straight on the favourite for odds somewhere over 2.00 is not a good in my opinion. The value is slim, but often even negative. After a break of Querrey the opportunity would be better. His lowest odd was 1.07, when he had a breakpoint for a 4:1-lead. Often a better opportunity comes, you just need to be patient. Scalping after a lost (first) set of the favourite is not a bad strategy, but the timing is very crucial.

Tomorrow is another day. Let's see which opportunities will come...


Sunday, 14 June 2015

Sunday trading

Actually I was watching the final at s'Hertogenbosch between Camila Giorgi and Belinda Bencic. The match didn't give much trading opportunities (only two late breaks), so I switched to Agnieszka Radwanska against Monica Niculescu.

I was able to make a good profit (around 50 Euros) in the second set when the Pole reduced the break deficit and was looking like the secure winner. In the end she lost the second set, and I was quite sure she will fight back in the third set. I was wrong, Niculescu played a really strong match and swept Radwanska in the last set away (6:0!). Unfortunately also a big part of my profit went away...

I made some small adjustments in the strategy. Considering Dan Weston, a tennis analyst and trader, there is a huge chance that a player will have a chance for a rebreak, but only a part is converted: http://www.tennisratings.co.uk/point-data-for-in-game-trading-in-the-atp-wta

To generate a green book, which you can use afterwards for a riskfree reinvestiment, it's important to take profit. I decided to green a bit (take out 1/2 of the stake) at the following scores: 0:30, 0:40, 15:40, 40:A.

After Radwanska also David Goffin had a very disappointing last set against grass specialist Nicolas Mahut. He lost 6:7 and 1:6. It cost me 60 Euros. So far it's the biggest single loss, but it's still in the framework of the money management. Trading is no one way street, so you have to accept losses from time to time and stay calm. In earlier days i started the "chasing mode" and that was the beginning of the end. After a loss you have to wait for the next real opportunity. I am sure it will come, next week bigger tournaments at Halle and Queens take place. I look forward to more interesting trading opportunities...