Random Trading – Why Would You?

Randomness is a massive part of Betfair market price action.

One of the greatest books on trading contains no practical advice about the markets whatsoever but still describes price action very well. The Drunkard’s Walk by Leonard Mlodinow details how nearly all aspects of life are ruled by randomness.

Randomness is a massive part of Betfair market price action. It’s one of the principal reasons that almost every backtest fails under real market conditions. Didn’t know you could backtest a trading strategy with Betfair data, huh? I’ll let you in on that one next week.

I consider tactics to be much more important than strategy when it comes to making money trading the Betfair market.

My favourite tactic is where I will enter a trade at one level and if it goes against me I will add to the position allowing me to exit the trade at the original entry rather than the original take profit.

I know. I know. The horror! I am breaking one of the sacrosanct rules of people who never-actually-trade-betfair-with-real-money-but-like-to-peddle-trite-theories-of-risk-and-reward. Yes, I am increasing my risk and limiting my reward. Yes, such tactics require a much higher win percentage to be profitable. And yes, they can lead to disaster if you don’t properly balance the ratios. But instead of having a religious argument about risk and reward just do the following.

Set up BfBotManager in simulation mode. Write a strategy to place 50 random trading  trades with 5 pip stop and 10 pip take profit and then place another 50 trades with 10 pip stop and 10 pip profit, then another 50 trades with 20 pip stop and 10 pip profit. You’ll notice something interesting – the win/loss ratios are not proportional. At 5TP/10 stop, you could lose 90% of the time but at 20st/10tp you may win 55% maybe even 60% of the time. You will still lose, but much less and it will take much longer than through the “traditional” way of trading.

Why? Because of something called path dependence. In the la-la world of trading gurus where trend spotting is easy (once it’s already happened) and price moves linearly from point A to point B, using 2-1 risk reward ratios is…obvious! But in the real world where every Betfair price tick is subject to random variables the path is never smooth nor linear. Add to that the fact that the market, like a skilled poker player, is almost always trying to trick you into the wrong move and your accuracy at any given price is actually more like 25% for to 75% against versus the 50%/50% that is commonly assumed.

That’s why single entry tactics are the height of arrogance, especially in Betfair trading where the stops are small and the margin for error is tiny. Random trading as a Betfair trading tactic is designed for maximum  success in a real market environment.

Our AI articles are NOT written by a real person and are provided for entertainment only. They may contain content which is inaccurate but we are hoping our AI bot, Rose, will become better over time. The AI category is the ONLY section of JuiceStorm.com that has zero human input.

In 2021 TradeHost traded 7,937 Betfair UK, IE, US & AU horse racing and greyhound markets.

2022 saw TradeHost become even more profitable with 22,698 Betfair markets traded.

All trades and bets were streamed live on JuiceStorm TV which was was watched by 124,209 traders in 2022.

All results for the 30,635 Betfair markets traded are here and the charts are here.

Top 100 Comments on JuiceStorm.com

Racing Traders has over 20,000 registered members and more join every day. Find out why with a free trial.

BetTrader from RacingTraders.co.uk was the 1st application for Betfair & introduced the ladder UI. Invest £99 in yourself with a JuiceStorm EXCLUSIVE crypto only offer for a BetTrader lifetime license and no further payments.

Successful Betfair Traders have the simplest Betfair Trading systems. The difference is their selection process, experience and execution level. Get that difference for yourself with automated trading by TradeHost.
Leave A Reply
Comment Rules

  • Please show respect to the opinions of others no matter how seemingly far-fetched.
  • Abusive, foul language, and/or divisive comments may be deleted without notice.
  • Each JuiceStorm member is allowed two daily comments. Use them wisely.
  • Comments must be limited to the number of words displayed above the comment box.
  • Use branded capitalisation, eg. JuiceStorm, TradeHost, BetTrader, etc or John will get upset.
  • You agree that any comment you make may be used for marketing purposes by JuiceStorm.com.
  • You need more than 20 words? Click here for the largest Telegram community for Betfair Traders.