Bank Holiday Sunday, August 29th 2010

Hi, my name is Dave and I have been trading the sports markets on Betfair for about 4 years now on and off. 


My main downfall, and I know I'm far from being alone in this, is discipline! Staying in a market for too long, not taking a small profit, entering a trade with no defined exit strategy for when it all goes wrong... I'm sure many will identify with this!


 I have read many wise words on the subject of compounding... indeed one Albert Einstein is reputed to have described compound interest as 'The Eighth Wonder of the World'. 


I decided to conduct a simple experiment using the concept of compounding to turn £100 deposited into a Betfair account on the 29th August 2010 into £2000 by New Year's Eve 2010. To aid me with the discipline aspect of the experiment I have decided to stand or fall in this endeavour publicly... those interested can follow the journey and see what we can all learn from the experience.. To achieve the goal of £2000 by New Year's Eve 2010 the daily compounding rate is a modest 2.427% per day. To make the sums just a little bit easier I will work to a daily target of 2.5%. On day one, therefore, my target is to make £2.50 net of Betfair Commission. My bank at the start of day two will be £102.50 - producing a target for day two of £2.56. By December 30th, with a day to go, the bank should be £2136.78 with an achievable looking target of £53.42 to make from the New Year soccer markets....


With a modicum of luck and a following wind there will be days when I make more than the 2.5% target...on those occasions I will roll up to 5% back into the bank, withdrawing half of any surplus over that amount...so I would hope to have recovered the £100 initial investment within the time frame all being well.


Equally there will be the odd day where it all goes horribly and spectacularly wrong - and I will take a loss. When that happens I will not follow the above rule again until the target immediately prior to when the cock-up occurred is reached.


In the main I intend to use the soccer markets to achieve my goal, but there will be the occasional foray into other areas of sports trading. Trading horses pre-race, whilst potentially VERY profitable, to be frank leaves me bored witless very quickly, but I might do two or three races per day for the time being. There will be occasional trades on Rugby Union and League, F1 and cricket. I know lots of people make a load of money trading tennis, but again the games bores me so I probably will be leaving that one alone. In the winter months there will be the odd dabble or two into snooker and darts. And lets not forget golf, a much more tradable sport now the one time master of all he surveyed seems to fallen off the pace a bit recently....