Saturday, 19 July 2008

Traded like a fool!

Daily Loss £184.62

This is proving to be a nightmare month right enough!

During this month, even though I’ve traded like a muppet at times and at times lost my discipline, I haven’t been too hard on myself. Well, that’s about to change as I traded like a fool in a race today and I’m really pi**ed off about it.

I never post my P&L when I lose as I don’t think it helps motivate me much but today is an exception. I traded very well today for the most part and that’s what really disappoints me the most.

Here’s my P&L:











Even though you can’t see it on here, I lost £100 in the first race today. I’m not too upset about this loss but I’ll take it away and think about how I could have traded the race differently.

I had a glance at the 5 day declerations for the races at Market Rasen today on Thursday. In the first race, a horse stood out at the foot of the handicap. Advancement was running off 10st 1lb with Timmy Murphy on board. For those that don’t quite understand what this meant, Timmy Murphy only had 1 ride today as he would have had to sweat to do that weight at this time of year. At the 5 day decs for this race, David Pipe had 5 entries but Murphy was down to ride this one. Even without looking at the form, this was a tip in itself.

When I saw the final decs for the race and I realised that Murphy only had one ride all day, it helped to convince me even more that the horse would run well. I spent 2 hours going through the race last night and basically, there were only 4 horses in the race that could get anywhere near Advancement. I thought it was a 5/2 chance at best, so I was amazed when I saw it priced up at 7 last night on Betfair. Not surprisingly, before I could get any reasonable money on it, it was trading at 5.

This morning, the horse was backed from 9/2 to 3/1 with every bookmaker and I made an early decision today to trade this to try to get as large a riskfree bet as possible.

Well, as the day went on, the market decided to disagree with me in a big way and the horse ended up drifting from 3.8 to 6.6. My first bet was £400 at 4.4 and it was downhill from there.

At the off, I had £100 at 1.5 on a horse which started at 6. Amazing really and I was proved right when the horse ran really well but came up against a better handicapped horse and finished 2nd. The horse traded at 2.5 in running but I was stuck with my £100 win. So, a £100 loss on the race. (Incidentally, that was one of the other 3 on the shortlist.)

Can people send me the answer on a postcard please of how you trade a horse that you think is the wrong price on Betfair……. I keep getting in arguments with the market and sometimes, even though I’m right like today, I still lose!

I then lost £10 on a trade and so I was £110 down for the day. I worked my ass off for the next 14 races after that and traded great. I had 7 wins and 7 losses and had won back £87 of my losses and was looking to break-even for the day.

Disaster then struck……(and I didn’t even lose a penny!)

I was trading Tusculum in the 4.45 race. I can’t even remember why I fancied this if I’m honest but I had it down on my list of horses to trade today. My first bet was £20 at 21 and it drifted to 25, so I laid £15 off at 25. There was £200 available to back at 24 and I thought to myself, should I take all of this?

Well, I stupidly decided to go for a quick pee and then return 2 minutes later. When I got back, the horse was trading at 19 and I asked for £200 at 20. I again had the opportunity to take £200+ at 19 but no, I ask for 20.

Well, it’s history now but anyone who saw the market will know what happened. The horse got backed at all rates from 20/1 to 5/1 and backed from 20 to 6 on Betfair.

I was left punching my desk in frustration shouting you fu**ing idiot. If I had taken the £200 at 24 and then headed for a pee, I’d be looking at a £2k plus riskfree bet or a £400 profit on the race. I ended up with £23 riskfree on it!

Incidentally, the thing I didn’t know at the time was that Tusculum is owned by Barney Curley and it appears a well laid plan went astray today. The horse finished tailed off and was the first horse beaten today. No doubt it will pop up at some point.

Well, not for the first time, missing this trade affected me and I then traded the next race like a bloody muppet. I was trading Markington and I didn’t even fancy it that much being honest. It was more of a speculative play and it proved very weak in the market.

However, due to what happened in the previous race, I traded this horse like it was a fu**ing world beater when I knew it wasn’t and I ended up redding up for a large loss pre-race on the field and a smallish green on Markington and it was the first horse beat, so a large loss of £144. I then lost my discipline and tried to bail myself out with a £20 win on my last fancy Tyranosauraus Rex in the 5.05 at Ripon at 20 on Betfair.

Due to my lack of discipline again and stupid stubbornness, I didn’t leave an in-running lay and it traded at less than 3 before finishing 2nd at 14/1. That again made me lose my head at myself as I could have won £50+ easily in running by laying off but I decided to gamble. What a fool…….

At this moment, I switched off the laptop and was really pi**ed off with myself. I’m still annoyed with myself now to be honest as up until missing that trade on that steamer, I was trading great and was nearly level for the day.

It’s also been an interesting day on the golf and I managed to catch the last hour’s play or so. I’m now £25 green on the field and I still have my £2k profit on Alex Norren. I really fancy him to make a charge tomorrow as he played great today but dropped 4 shots in his first 2 holes! If he hadn’t done that, he’d be sitting at the top.

I’ll update the golf profit tomorrow night once it’s finished.

6 comments:

Steve said...

You need to take a long hard look at your strategy Graeme. You appear to have the talent for picking the direction the market will move but rarely seem to benefit from them due to possibly greed in wanting the big wins.

That's fine if you're gambling and let the wins/losses even out over long periods but you can't handle the inevitable losing days from the strategy and go off on a downer.

You need to either get used to the losing runs as your skills at picking the movements will pay off in the long run or just learn to take a green when it's in front of you and forget about the 'could have been' big wins.

It's easy to get caught up in the glamour side of trading once you start trying to make a living betting, and want the excitement of big wins as well as the buzz we all get from losing and getting back into profit. The truth is winning money trading is the most boring job around once you've cracked it. Ends up just clicking buttons at the right points and settling for small wins.

You'll have to decide if you can handle the losing runs that go with your strategy and stop piling on when the markets turned against you thinking you know best. Always a pain to have missed out on profitabe bets by not piling in but they're just as likely to go against you and money management skills are one of the most important skills you need to suceed in the long run- there's plenty of races over the year missing the odd one here and there makes no difference.

Anonymous said...

I'm sure it was you who said to me about downside and upside of a trade...
In a competative 16 runner handicap, likely to have be targetted by many of the runners, 4.4 on any horse seems a pretty short price to me. An opening play of £400 left you very little room in which to manoevre, if the market wasn't as convinced as you were...
I think this is a mistake you sometimes make - having too much courage of your own convictions...
I would happily have given you 4-1 about the horse - meaning that 5.5 should have been achievable on BF. However, even an opening play at 4.4 of £100, with your normal tactic of following a drift with increasing stakes, would have put you in a strong position, if you had read the race correctly.
You must discipline yourself not to go in too deeply too soon. At the end of the day, you are trading the horse and so trying to anticipate the market (not desparately back a winner at whatever price is available).
A.

Graeme Dand said...

Hi Steve.

Thanks again for the comment. Some of your comments above are quite thought provoking and have got me thinking about things again. At the moment, I seem to spend far too much time thinking about what I should do but not carrying it out, so I’m going to work hard to put my preaching into practice!

I agree I need to take a look at my strategy. This month has involved me thinking about my trading strategy a great deal and I’ll share some thoughts at the end of the month when I do a review of the month.

The comment about ‘greed’ is not particularly true to me if I’m honest as I have made an attempt to change strategy this month. One thing I’ll never get right every time is exiting my riskfree bet at the correct time. ‘Normal’ traders do this pre-race every time but I know I have an edge on most traders simply due to the fact I can read races better than them.

For example, if I have a riskfree bet on a front-runner, I know I can trade that in running quite easily to green up at a few points lower thus increasing my profit margin substantially. One thing I have been doing since the middle of last month is taking a small profit from my selections quite early in running. You will have noticed this from looking at my P&Ls.

In the past, I would have had 8 break-evens and a £100 win. Now I have 6 small profits, 2 break-evens and a £50 win. All I’m trying to do is smooth my profit a bit. In the long-run, it won’t make much difference I guess but it helps my mindset to see consistent profits.

I agree that I don’t handle losing races very well but that’s more to do with the magnitude of the loss. I know I will have losses but at the moment, I’m consistently having £100 losses in races. How I can lose £100 trading when I’m using £100 stakes is beyond me and it is poor discipline and not cutting losses early enough that’s getting me into these situations.

I disagree with the comment about taking ‘the green in front of me.’ From what I have learnt about trading and from what I read on other blogs and from talking to other traders, I appear to be able to earn profits much higher than my bankroll allows me too. On some races, I use £20 stakes to generate a riskfree bet of £200 on an outsider. When that trades at 3 in running and I win £50 on the race, that’s a return of over 200% on my stake.

My maximum stake in most cases is £100 and some days, I can double my bankroll from trading 10 races. I admit this sort of thing is hopeless if I consent on throwing away my whole day’s profit on a race but cutting my losses is something I’m still learning about.

One of the reasons I don’t scalp is the fact that I find it boring. For me, scalping is all about clicking buttons and making small profits every race and making a small return on a large bank every day. I’m sure if my heart was really in it, I could try to go back to scalping and can probably turn a small profit every time I trade but I’ve no interest in doing this.

When I set out on this experiment, I had no idea what I was doing. I decided against the scalping route quite early on and have made up my own trading strategy. At the end of the 12 months, I’d hate to think all I’ve done is learn to scalp the horse-racing markets. I want more than that…..

One great thing about my strategy at the moment is that it is very scalable. The larger the bankroll, the smaller the risk and the larger the returns I think. There are traders out there who are using £5k to £10k banks to manipulate the market to scalp. I’m able to manipulate the market with a bank of £1k at the moment and I’m showing what can be achieved.

If I can learn to cut my losses early enough as at the same time as not nullifying my trading strategy, I will have cracked it I think. I think traders maybe spend years trying to find a strategy like I’m developing at the moment. I admit I’m nowhere near where I want to be but I have time on my side. I have 5 months experience now and I make novice mistakes every time I trade but over time, I’ll get better.

I’ve shown this month that I can handle losing. Without calculating the figures, I’m guessing I’ve lost £1,000 on trades this month. The fact I’m nearly level for the month may prove to be an amazing achievement in the long-run.

Finally, I agree I sometimes get too annoyed when I miss a great trade. However, when a horse I’m trading goes from 28 to 6 on Betfair, I have every right to feel annoyed with myself. This is the sort of thing that happens once a year with my trading strategy. For me to identify that horse to trade and then not trade it when it shortens is a MASSIVE error. I know it is one race but if I had traded that race properly like I did with most other races on Saturday, I would have won £500 pre-race profit alone on that horse.

Thanks for such a great comment Steve. This month, some of the comments on the blog have been amazing and have really kept me going when times have got tough.

Graeme

Graeme Dand said...

Andrew,

We’ve spoken about this many times before but when I really, really fancy a horse to run well, I can’t trade it properly!

I’m starting to think that in these few races where I think the market is badly wrong on a horse I think will run very well, I just put £100 win on it at the off, lay £100 2 points lower in running and if I’m right, I get £200 riskfree. If I’m wrong, I lose £100 but then again, I wanted to gamble anyway, so I can’t complain.

I noticed this was 1.8 to place on Saturday and in my eyes, this was a 1.01 chance to place, so maybe I was betting on the wrong market. £100 win at 1.8 would have won me £80 profit and I would have settled for that.

I agree that I maybe got a bit carried away on a horse in a competitive 16 runner handicap hurdle but if I’d discussed the race with you on Saturday, you would have been lumping on it! lol

I even noticed that my 4 horses dutched in the race were about 1.8 on Betfair and it really was only a 4 horse race, so again, I could have lumped on that and won £80 for very little risk to my £100.

It’s clear my trading strategy works well 80% of the time now. I need to tweak the strategy to cope with big drifters though as the large losses have killed me this month. Once I cut out these stupid large losses, I can get back to making some nice profits.

On Saturday, when Advancement was drifting, I was salivating at the price as it was never a 4 shot since it was only a 4 horse race. However, I probably missed the fact then that the winner was never a 10 shot in a 4 horse race either……..School Boy Error!

When will I learn?!!!

G

Steve said...

Glad to see you took the comments in the way they were intended and not a dig Graeme.

Your trading strategy does outweigh the expectations of 'normal' traders but so do the losses. If you start to cut short any drifts you could just end up closing out on the normal market swings that always occur and end up worse off.

I can understand your reluctance to scalp the markets as it does get boring but the bottom line is your green at the end of the month not after a day or a race. I think with your strategy as long as you get your head round the fact you will have big losers as well as wins and not to overreact when they occur you should do OK. Most traders , especially if you rely on it for a living prefer the stress free hassle of greening up.

I think you need to have some idea of what you hope to acheive from it all. If you're looking to go full time I'm sure you'll eventually come round to the stress free and boring greening up. Don't want to sound negative but it's very easy to let the trading lark take over a disproportionate amount of your free time thinking about strategies etc all day long. There are lots of better and fruitful ways to use your time if you treat it as a hobby and for a few extra bucks a bit of overtime will probably be a better paid hourly rate and a lot less stressful.

Not trying to put you off as we've all been there at some time getting caught up in the highs and lows of betting but eventually winning clicks into place and it's not the holy grail we'd assumed. It becomes like a monotonous job much like any other but with added benefits and drawbacks.

On the plus side even though there are plenty of better traders than us out there, there are plenty more mugs willing to fund us.

I just think you need to have some idea of what you want out of it as most of the traders you'll be speaking to are doing it with the one aim of making a living. If that isn't your aim you may find it ends up being a very expensive or time consuing hobby for little reward at the end.

GL

Steve

Graeme Dand said...

Hi Steve.

Thanks again. I appreciate the time you take to write these comments and I do agree with most of what you say!

It’s now clear that I don’t really know what I want to achieve from my trading. As I’ve said a few times, I’ve picked up the trading game far quicker than I thought and I’m probably just suffering from a lack of experience at the moment. When I started out, I didn’t expect to spend as much time trading as I currently do and it was only going to a small hobby.

However, as I’ve got more into it, I’ve started to want more from it and now I’m not really sure where I want it to go. I’ll write something more about this later on at some point when I do a review of this month.

I agree about the whole greening up thing. I’m not using very big stakes at the moment, so that’s partly why I don’t green up. I know I can do better by using some knowledge of how the horses will run.

If I ever get to the stage where I’m trading a nice green profit every race, I will definitely switch to greening up every race and it will make my life easier. I don’t have the confidence in my trading ability to use much higher stakes than I currently do and I’m hoping this will also come with experience.

I think I am looking for the Holy Grail and I agree that I’ll probably never find it but I need to go through the process of trying to find it. I’m sure you were the same at the start and experience has made you much wiser but I’m lacking that experience!

Overall, I want to employ a trading strategy that makes me consistently high profits with minimal risk and most of all, I want it to be enjoyable!

I’m not asking for much…..lol

Cheers again for the comment!

Graeme