The Worst Betting Exchange Habit That Makes You The Most Money
Exchange Betfair Traders that have been able to "let their profits run" are simply lucky idiots
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Ever since I first picked up a book on how to trade – not Betfair Trading and more years ago than I care to admit – the one piece of conventional wisdom was “Let your profits run and cut your losses short.” I would venture to say that this little nugget is responsible for more losses than any other Betfair Trading rule ever devised.
In actual markets there is absolutely no way to let your profits run while cutting your losses short. You either cut your profits or cut your losses, but you can’t have it both ways. That’s because markets, and especially Betfair, almost never move in one direction.
Anyone who has ever been able to “let his profits run” is simply a lucky idiot who like a lottery winner guessing a random number, just happened to catch that breakout and was stupid enough to believe that it would continue without retrace. It happens. Just not often.
Now “professional gurus” would be horrified at my blasphemy. They would tell you that one of the worst things you can do as a trader is to cut your profits short. After all, how are you supposed to pay for all those stops?
The problem with professional gurus however is that they are great at Betfair Trading the left side of the chart. They are awesome at picking prime examples of trends AFTER they take place, but I have yet to see any of them succeed in my domain – at the right side of the chart where fear and uncertainty control every tick and real capital is won or lost on your tactics rather than your theories.
In that world – the real betting exchange markets – taking your wins too quickly is one of the most profitable things you can do.
Because successful Betfair Trading is not about making money. It’s about NOT LOSING money. There are three basic classes of betting exchange trades. There are trades that make money right away. There are trades that lose money right away. There’s nothing much to do about either one of those types of trades and you just take them as they come.
There is however a broad middle ground of trades that appear to be uncertain as to whether they want to be winners or losers and this is where all the bad habits of impatience actually pay off big.
Now, as Betfair Traders whether we are Hindus in New Delhi, a Jew in Tel Aviv, a Moslem in Dubai, Chinese in Singapore or just jolly old rogers in Melbourne – we are in fact all Anglo Saxon at the core. What I mean is that if we live in the advanced industrialised world we have all internalised the Protestant work ethic and with it the core belief that we must sacrifice in order to succeed.
Generally that’s a great rule to live by – except when it comes to Betfair Trading. Good things do NOT come to those who wait. We must not endure pain in order to make profit. The betting exchange markets flip all those long ingrained behaviours on their head.
You got out of the trade a bit early and gave up 10 more ticks of upside? Who cares. There is another trade right around the corner. In the meantime, you know what you also did? You got out of a trade that could have turned sour and made 5 ticks instead of losing 10. You know what you also did? You freed your capital to look for other opportunities instead of sitting in front of the screen paralysed like a deer in headlights, hoping – or praying – that you can get back to even while other Betfair Traders are banking profits elsewhere.
The most important thing that you did was NOT invest. Not invest your time. Not invest your money. Not invest your psychological capital. By selling too early you became a true betting exchange trader.
So go ahead – get out too early. Give up the profits. Once you start doing that on a regular basis the only thing you’ll regret is not picking up this bad habit earlier.
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.