Betfair Staking Depending On Tick Size

Wednesday, November 30th, 2011
By Racepedia

Staking

Before even beginning to trade on Betfair it is essential to have a staking strategy already in place. I’ve highlighted the dangers of not having a staking strategy with the example below:

 

Example

You place £100 at odds of 4.4 and the odds drift to 4.9 you will have effectively lost 50% of your money.

£100 * 4.4 = Profit £340

BUT! The price has gone against you so now you have:

£100 * 4.9 =Liability of £390

 

If you trade-out (this is called ‘greening-up’) then you would be trading for a loss of £50 if the horse does win (340 – 390 = -50). If you let the race run and the horse loses then you break even (your lay bet wins you £100 but your back bet loses £100). This article is about trading though so ideally you should look to exit the market before the race even begins, if you find yourself praying the horse loses then you are not trading, you’re gambling!

Betfair Market Tick Size

The market prices on Betfair increase and decrease by increments, the size of these increments depends upon which odds range they are within. These increments are commonly referred to as ‘ticks’.

 

Tick Size Increment

Odds From

Odds To

0.01

1.01

2.00

0.02

2.02

3.00

0.05

3.05

4.00

0.1

4.10

6.00

0.2

6.20

10.00

0.5

10.50

20.00

1

21

30.00

2

32

50.00

5

55

100.00

10

110

1000.00

 

Example

If you are trading an event and the price is 1.69, Betfair will only allow increment increases and decreases of .01. If the price fell by one tick then it will have fallen to 1.68, if the price rose by one tick then it would have risen to 1.70.

 

Example

If you are trading an event and the price is 2.34, Betfair will only allow increment increases and decreases of .02. If the price fell by one tick then it will have fallen to 2.32, if the price rose by one tick then it would have risen to 2.36.

 

Example

If you are trading an event and the price is 11.0, Betfair will only allow increment increases and decreases of .5. If the price fell by one tick then it will have fallen to 10.5, if the price rose by one tick then it would have risen to 11.5.

Danger: If you placed a back bet of £100 at 11.0 your stake would be wiped-out in only 2 ticks if the horse won!

£100 * 11.0 = Profit £1000

£100 * 12.00 = Liability of £1100

Back bet – Lay Bet = -100

 

If you traded the above you would have lost your entire stake in only 2 ticks (if the horse won). This is the reason it is best to stake proportionally to tick size and calculate return per tick, the strategy is discussed in more detail below.

 

Proportional Betfair Tick Staking

The table below shows how much money per tick should be allocated to each trade. It is a quick and convenient method and ensures you do not over/understake.

 

Staking at £1 a Tick

Increment

Odds From

Odds To

£100

0.01 (1%)

1.01

2.00

£50

0.02 (2%)

2.02

3.00

£20

0.05 (5%)

3.05

4.00

£10

0.1 (10%)

4.10

6.00

£5

0.2 (20%)

6.20

10.00

£2

0.5 (50%)

10.50

20.00

£1

1 (100%)

21

30.00

£0.5

2 (200%)

32

50.00

£0.2

5 (500%)

55

100.00

£0.1

10 (1000%)

110

1000.00

 

Example

Trading at odds of 9.0 will mean using a £5 stake.

 

Example

Trading at odds of 15.0 will mean using a £2 stake.

 

Risk Management

If you are trading at low odds (below 2.0) you will have to overcome the psychological barrier of having hundreds of pounds in the market place before you complete a trade. Try to remember that you may be using hundreds of pounds but you are only risking per tick.

 

Example

Back bet of £300 at 1.87. The price moves to 1.76 and you trade-out/green-up.

 

£300 * 1.87 = 561

£300 * 1.76 = 528

 

This would give you a locked-in profit of £33 (each tick represents 1% loss or profit, 11 ticks is £33). If the horse wins you get the £33 profit. If it loses it costs you nothing.

 

Normally you would equalise your trade so that you are guaranteed an equal profit regardless of the outcome of the event.

 

Example

£300 * 1.87 = 561

£312 * 1.76 = 549.12

If the horse loses you would have £12 profit (312 – 300 = 12)

It the horse wins you would have £11. 88 profit (561 – 549.12 = 11.88)

 

Betangel

The Betangel software has a function that automatically adjusts your stake in accordance with the odds available. It is a good tool to use if you wish to become a serious trader but be careful when the odds are changing from one increment barrier to another (i.e. when the odds move from .01 increments to .02).  More information about Betangel can be found by clicking on the link below.

http://www.betangel.com/cmd.php?af=1426322

 

 

2.00

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