I was sitting having lunch recently with somebody who has a casual interest in currency trading but was fascinated to learn about the world of trading sports on the betting exchanges. Coming from a world where he felt the only way to get an edge on the markets was with “inside information” he asked me if that was the same way that people gain an edge on Betfair and it got me thinking.
There are certainly those who profit on the betting exchanges via “inside information” that is otherwise known as “courtsiding”. However, the exchanges are a different ball game from the financial markets that have billions turned over on them every hour. The competition on the betting exchanges is no where near the same level you get on other exchange markets and so to gain an edge does not require huge investments in technology, or “inside information”.
Since your competition on the betting exchanges is mainly other punters you just need to DO MORE than the average punter would do.
Here are some ways you can do MORE than the average punter:
1 – Study The Markets
There are value opportunities in most in-play events but they come and go and sometimes they go in a flash. Being able to spot them quickly will help you gain an edge on the rest.
The average punter who gets involved on Betfair probably has an “idea” of where prices might be or should be at certain points of an event but they could not be certain of it. Therefore, if you want to gain an edge you should watch all the markets in your chosen sport both pre-event and in-play and keep an eye on their behaviour. I remember first discovering Betfair and being fascinated by watching live sports events unfold and watching the markets react to the on-field events. I would sit for hours just watching back and forth just taking notes without trading and you should do the same. Would the average punter do that? I doubt it, which is exactly why you should if you want to get ahead of them. Knowledge is power, as they say.
After a while knowing exactly where prices will be or “should” be will soon become an instinct for you and you might only need to look at a market at a certain point to be able to spot value.
2 – Study The Sport
After years of being owner of this site I have found that many newbies are quite lazy when it comes to studying the sport they are trading. I have concluded that the average punter does not like to look at many stats before the event, if they even do that at all. If you have done even the smallest bit of homework on a football match then you might already have more then enough knowledge to help you gain an edge on the rest. It really is amazing how many punters go on their “gut instinct” or just by looking at small sample sizes to build their opinions on. Also, in this day and age, keeping spreadsheets and building your own databases of stats is also a surefire way of getting one over your competition.
3 – Live and Breath the sport
To be a lover of the sport you trade is also something that can give you a big advantage over the average punter. Especially in sports like Tennis, Cricket, Darts and Golf which arguably do not have as much media coverage as football. So when the big events come around you get more and more casual punters involved and they are easy to get the edge on.
Either way, if the sport you trade is something you follow daily then you are already doing more than the average punter who might only get involved in an event once he notices it is live on the TV or if he just “fancies having a dabble”.
4 – Specialise in a niche
If you want to gain and then KEEP the edge you have on the average punter then you should have a niche you specialise in. I have met many professional traders however I am yet to meet any that say they trade EVERYTHING and profit on everything. I simply do not think it is possible to have an edge in every sport going. Even if trading on a sport like football I have found that the professionals usually have certain markets or even certain leagues that they specialise in. For example, If you took a certain league such as La Liga, studied it, watched the markets within it, lived and breathed it and then only traded on that league. I am sure you would already have a huge advantage over the average punters who might have only heard of the Madrid clubs and Barcelona.
To sum up….
It is actually not that hard to gain an edge on the betting exchanges when compared to how hard it is to gain an edge on the financial markets. But it is still hard work either way and it is hard work that is the only real way to get good anything. No matter what field you are in.