Over the past few years, there has been a huge shift from football betting to trading.
There are a number of reasons for this, not least the fact that bookies are trimming margins finer than ever and restricting profitable accounts much more quickly. That makes betting increasingly difficult to profit from long-term.
Technology is also playing a part. Most of us now have fast internet connections, mobile devices and access to websites which help us to stay in touch with football matches all over the world.
Let's not forget the rise of the betting exchanges and software which make trading markets for football - or indeed any sport - easily accessible.
Finally, we have the simple fact that trading is more profitable than betting. It has been ever since Betfair came on the scene and it always will be.
In this article I will explain exactly what football trading is, how it differs from betting and what you need to get started.
What is football trading?
Football trading is where you adjust your position in-play to either lock in a profit or manage a loss.
Here's a very simple example.
Let's say that you have backed Arsenal to win and they are 1-0 up with 5 minutes to play. If you had placed a bet on the home win, you now face a nail-biting wait for the final whistle, hoping that the away team don't manage to equalise.
With trading, however, you are able to lock in a slightly smaller profit and walk away, knowing that you have a profit in the bank whether the match ends 1-0 or 1-1.
Imagine the possibilities!
You could click on Flashscores to see that Chelsea are 0-1 at half-time, even though they were expected to win. You are now able to back them at a far higher price, or maybe back the draw. You could even lay their opponents so that anything but an away win at full-time will result in a profit.
Trading opens up so many opportunities, but let's get back to basics and look at how markets move.
The 90 minute stock market
From a trading point of view, football is nothing more than a 90 minute stock market.
Let’s say that Dave is a financial trader looking to buy shares in Coca-Cola.
He checks the financial history of the company, strength of the competition, current market conditions and so on.
Based on all the data he can find, Dave makes an informed judgement about future profit and growth potential.
He looks at the share price and, if it shows some value, he decides to buy.
If Coca-Cola release some good news – perhaps a new flavour which starts selling very well – the price rises and Dave can sell his shares.
The difference between the price Dave bought his shares at and the price he sold them for is his profit.
Switch out Coca-Cola for Manchester City and the same criteria apply.
As a football trader, Dave checks previous performance, strength of the opposition, recent form and any other useful statistics that he can find.
In exactly the same way, he makes an informed judgement about Manchester City’s likely performance in their next match and looks for value in the various markets.
It may be that Dave expects Manchester City to score the first goal of the game during the first half.
He then has a number of markets he can choose to trade in; match odds, next goal, half-time score and many more.
Each of these markets lasts for a maximum of 90 minutes and Dave will know the outcome of his investment in that time.
It’s as if a stock market has been condensed into a very small amount of time.
How do Betfair prices work?
There are many factors which influence Betfair market prices, but they are roughly priced according to probability.
The easiest way to understand this is to imagine that the exact same fixture is played 100 times.
For example, if the Manchester derby were to be played 100 times over, there would be home wins, draws and away wins.
To keep things simple, we'll assume that the results worked out very neatly into 50 home wins, 20 draws and 30 away wins.
In probability terms, we'd have 50%, 20% and 30% - as long as future games were played under the same conditions.
Are you following so far? Good!
A 50% probability implies that half of the games played in the future will also end in a home win, therefore it would priced at 2.00. If you backed it for £100, you would either win £100 or lose £100 - 50-50 chance - 50%.
The away win only has 30% probability, so that would be priced at 3.35 and the draw at 20% would be priced at 5.00. In other words, one in five matches would be expected to end in a draw.
Obviously, this is overly simplified as there are a multitude of other factors to take into account - such as team news - but you get the idea.
Why do Betfair prices move?
Price movement is essential in order to make a profit.
There are a number of reasons why Betfair prices move, these are the main ones:
- Time decay
- Red cards
Time decay is the process of prices reducing over time. If the 0-0 price is in double figures at kick-off and no goals are scored during the game, towards the final whistle it has to hit 1.01.
If there are no goals in the first half, 0-0 will often be around a third of the price at kick-off and it continues to tick down as the second half progresses.
Time decay gives you opportunities to scalp the 0-0 price as it drops, for example, but with just one goal you will lose your entire stake. That's a bit risky! A much more popular strategy is to scalp the under 2.5 goals price because one goal still gives you the chance to get out with some of your stake or wait a while for the price to recover.
Goals change games and they affect prices too. Going back to the Manchester derby example, we had a home win probability of 50% and a price of 2.00. If the home team go 1-0 up, the probability of them winning the game will certainly rise from 50%, perhaps to 75%.
75% probability converts to a price of 1.33 which is quite a drop! In fact, if you use our hedging calculator to look at this scenario you will see that from a £100 back of the home win at 2.00 you will now be able to lock in £50.38 profit (before commission) no matter what the final result. That's a great example of the power of football trading!
Red cards also affect prices, often causing markets to overreact. Many fans think that a team with 10 men will automatically go on to lose by a large number of goals, but traders know very differently.
A 10-man team may sit back to defend, especially if the score is level. It's not very easy to break down a well organised defence when a team has 11 men and it's not that much easier against 10 either. The market, however, usually moves in favour of the team with 11 men and sometimes that isn't helpful.
Personally, I avoid games with red cards. There are so many games played worldwide that I have no need whatsoever to get involved in anything like that.
Why is market liquidity important?
Liquidity is the amount of money available in the market and it varies greatly from match to match.
When you want to trade out, you need to have someone else offering the price you need on Betfair otherwise you're stuck.
Match Odds markets tend to have the best liquidity and in bigger leagues, such as the English Premier League, liquidity is never a problem. There is always money waiting to be matched on both sides of the market – back and lay – so you can get in and out of trades whenever you like.
In smaller leagues, perhaps English League One, liquidity will never be as good.
It may be enough to trade on a Tuesday evening when there are not a huge number of fixtures, but at 3pm on a Saturday there will be lots of bigger leagues sucking up the available money.
You may well be able to get in and out of trades with smaller stakes, but you might need to wait a few minutes to be matched. There will be times when a goal will go against you while you wait, so bear that additional risk in mind.
Smaller markets in smaller leagues are even more troublesome.
The first half match odds market – known on Betfair as “Half Time” – is not nearly as popular as Match Odds and, therefore, liquidity will never be as good.
Whereas you might get away with the League One Match Odds market on a Saturday afternoon, first half match odds will be far more difficult. Perhaps even impossible.
If in doubt, stay out.
Developing a football trading mindset
With most bets you have two possible outcomes; win or lose.
There are different types of football bets available at bookmakers and if you go for something like a “draw no bet” then there is also a third possibility, but the vast majority of bets do not fall into this category.
When you trade, however, there are always three possible results; win, lose or scratch.
A scratch trade is one in which you neither make a profit nor a loss and it is vital to the long-term success of a trader.
Why? Trading is all about avoiding losses.
A trader knows that profits will take care of themselves, but avoiding losses is key to long-term success.
This is a strange concept for most who are new to trading because their mindset is geared up towards winners, winners and more winners.
They look for lots and lots of trades every day, assuming that the more trades they pile into the more profit they’ll make. Wrong!
The more trades you get involved with, the more likely you are to hit a loser and, depending on the strategy, that might wipe out the profit from two or three successful trades.
Trade selection, patience and discipline – all those boring old things – are absolutely vital if a trader is to make a long-term profit. There's good reason why successful traders bang on about mindset!
I surveyed Goal Profits members towards the end of 2014 and was astounded to discover that there were none under the age of 25. Not a single one.
Once I thought that through though, it made sense.
Young guys (lads!) like the adrenalin rush of crazy accas; they’re not interested in long-term profits.
Financial stability is far from the minds of most young men; they want to take risks and have fun!
A trader will look back over a year and be delighted to see steady bank growth, whereas a bettor will remember that one great acca win but ‘forget’ about all the losers.
The difference is mindset.
Which would you prefer? Steady bank growth? I thought so!
Types of trading strategies
There are hundreds of trading strategies out there across the many betting exchange markets.
One obvious way to split them up is by looking at when they are traded:
- Going in-play
Pre-match trading - also known as scalping - is when you look for price movement before a game even begins. This is often due to breaking team news an hour or so before kick-off.
The market has to guess the probable line-up for both teams and price the game accordingly. If the home team name a team with their star striker missing, it will cause their price to drift out. Scalpers will jump on this price movement as soon as possible and lock in a profit.
Traditionally, trading strategies are those in which a position in taken before kick-off and then the game goes in-play. Win-draw-win is an obvious example where a team is backed before kick-off with a view to trading in-play once they - hopefully - get themselves in front.
In-play strategies are exploding in popularity, mainly due to the bigger profits possible with lower risk. If you are planning to back Liverpool, for example, you can wait 15-20 minutes and check to see that they are winning corners and having shots on goal. If they are, then you are able to back them at a higher price.
We are trading in-play a lot more at Goal Profits these days, especially with our exclusive Team Statistics software guiding the way.
The time factor
This is the bugbear of most people as they move from betting to trading… time.
Yes, trading takes a bit more time than betting – of course it does – but you get so much more control over your money at risk that a bit of effort is well worth putting in.
Let’s be honest though, football trading really doesn’t take too long at all.
I mean, an entire match is only 90 minutes and many football trading strategies focus on one half only which immediately cuts that in half.
Once your trading position is open, what do you have to do anyway? You’re usually waiting on a goal, so you can easily go watch TV, read a book or do some housework.
A score site such as Flashscores will tell you when a goal goes in, then you can tend to your trade. You can even download the Flashscores app to your phone and go outside to wash the car. With Betfair on your phone, you might not even need to come back inside the house!
“I don’t have time to trade” is such a poor excuse, yet I hear it all the time from those looking for a reason to make quitting acceptable.
If you really want to be successful at trading, you’re not going to quit but find a way to make it work for you, just as these guys did - click here for tips on trading when short of time.
How to start trading football
The first thing you must understand is that you will not start trading and immediately pull money out of Betfair like it's an ATM. That just doesn't happen in the real world, though the many scammers in this industry will try to tell you differently, of course!
Just like any new skill that you wish to master, there is a period of learning. A football trading community - such as Goal Profits - will certainly help to accelerate the time it takes, but you should still be prepared to be patient.
You're going to make mistakes, so start out with small stakes and then they won't cost you much. There will always be more football fixtures to trade, so there really is no need to rush in.
Remember that Betfair is full of very clever traders whose sole aim is to take your money. In order to take their money and be profitable, you need to be smarter and more disciplined.
If you're new to trading, you need a very simple strategy to start with.
I have a great one to get you going, you just need to let me know where to send it.
It's completely free, makes a profit and I'll even give you free selections for life!
Once you have practiced trading with your first strategy, you will be ready to progress further. Most traders will try lay the draw - the old favourite - next and that's not a bad step at all, but it's worth reading my LTD post first - click here.
Trading is not entertainment
Football trading is not for entertainment; it is not something to keep the boredom away on a Saturday afternoon. A trader without discipline will soon be a trader without a trading bank!
There will be days when nothing quite fits and in this situation, a successful trader does not trade.
Yes, many of the dropped trades would have been winners but that makes no difference whatsoever. A weak trade is still a weak trade whether it would have made a profit or not, so stay out. Be smart.
Win or lose, it doesn’t matter; you made a good decision.
You don’t kick yourself, you don’t get mad, you applaud your discipline knowing that long-term it will see you right.
Setting a trading plan
Before you start trading, go through the fixtures for the day and build a shortlist of matches which you are interested in.
These are the ones which need additional research until you are left with a small number of the strongest opportunities you can find.
Once you have your plan for the day, that's it set in stone. What you must avoid at all costs is hitting a few losses, running out of matches to trade on your plan and then looking for more to get involved with. We've all chased losses and it nearly always ends in tears. Don't do it!
Instead, take it on the chin, learn what you can in order to improve and come back tomorrow with a fresh mind. You will learn a lot from losses and they will always happen, so accept them.
Once you are more experienced you may wish to get involved with a small number of in-play trades, but in-play is an incredibly easy way to lose money so be careful!
If none of the fixtures on your trading plan end up being tradeable, so be it. There will be more tomorrow... and the next day... and the next...
This doesn’t just mean waiting for strong trading opportunities; once you have found a strong trade and conditions are right, you may decide to wait before opening your position.
Let’s look at an example of a first half lay the draw trade.
It may be 2.80 to lay the draw at kick-off, but after 20′ you could well be able to lay at 2.00.
Even at small £10 stakes your liability will fall from £18 laying at kick-off down to £10.
But that’s not all; you will be able to look at the in-play stats before entering your trade and if there have not been many shots or corners, you may decide to leave the trade alone and save yourself from a potential loss.
Even better, once a goal is scored the price will rise a lot further from 2.00 than it will from 2.80 and that means a lot more profit.
Of course, it can’t all be good news.
In this case, you will be reducing the time window you have to find a goal by almost half. You may also find that you miss out on a number of planned trades when early goals go in, but that’s ok; nothing lost.
As with all aspects of trading, it will come down to your personal preference as to how you decide to get involved. There are plenty of options and methods to suit your own trading style.
Most people think about “trading out” during a game, but you must always consider “trading in” too in order to lower liabilities and increase profits. It makes sense!
Scratch = Win!
So many new traders are disappointed with scratch trades; those with no profit or loss. You have to understand though that scratch trades are actually winners, here's why.
If you back Manchester City to win and they take a 1-0 lead, you might look at their stats and discover that they hardly concede goals late in games. You may also see that their opponents are having a lean time in front of goal and that their in-play stats are poor.
One logical approach in this situation would be to lay enough profit so that anything but a City win is scratch, leaving a bit more profit should they hold out - as expected.
If there's an equaliser with the last kick of the game you're going to be a little disappointed, but you had a free bet on City doing what they usually do against a team who will not get that goal on most occasions. Most of the time you'll have had a profit, it just happens that you didn't this time.
But... you won your stake!
You put money down on City, then took it back when they were 1-0 up. You know that most of the time your decision will result in a profit so long-term, you're in good shape!
Remember, trading is about avoiding losses; the profits will look after themselves.
Taking it to the next level
Football trading can be quite a lonely endeavour and our community connects traders all over the world, many who are just starting out and a growing number who trade full-time.
It's not the sort of place where you’re given a few eBooks then left to get on with it yourself, we provide as much information and support as you'll ever need to reach your trading goals.
For example, all members get full access to our 16 week 'Launchpad' trading course which guides you right the way through from day one to becoming a competent trader.
We trade side-by-side with members in the chat room, though with 16 strategies and 65 leagues covered worldwide there are plenty of opportunities at different times day and night.
Our exclusive Team Statistics software covers most leagues which have enough liquidity for trading and produces a daily shortlist of fixtures for each of our strategies.
You can trade whichever strategies you prefer at times to suit you and if you get stuck, you have continual access to professional traders who will help you.
The Goal Profits community is all about helping members to achieve their Betfair trading goals.
“Hi Steve, thanks for the emails. Just a quick note to say how much I’m enjoying learning to trade and how much more sensible I’ve suddenly become! The site and Team Stats is brilliant and I’ve learned more in three weeks than the whole last year of throwing away money on ridiculous accas and paying money to affiliate tipsters and ‘fixed match’ fraudsters. Looking forward to learning a whole lot more!.”
Goal Profits member
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