Knowing where the prices are expected to move to in-play is one of the first things that any in-play trader should try and learn. By having this knowledge you can then easily plan out your trades and measure your risk in advance. You are then less likely to be caught out by situations where you have underestimated the market.
For those who are new to TENNIS TRADING, trying to work out where the prices will move to in-play after a break point or a set is won can almost seem like guesswork. Some might assume you need a fancy spreadsheet or piece of software that will tell you where the price will move to but it is much more simple then that.
I trade tennis professionally and I do not use anything to predict prices in-play apart from using a simple formula along with a bit of common sense.
Before I get into this it is important to stress that it is actually almost impossible to predict the EXACT price that the market will move to since there are many external factors that can affect the markets. So what we are looking for is the “ballpark” so we can assess the worst case scenario.
Also, this is based on 3 set match format. I rarely trade 5 set matches personally and the markets do behave differently in those.
The First Break
Usually when either player scores the first break point it means their price will halve. So to get an idea of where a players price will move to after they score the first break point then you divide their starting price by 2.
So if a player’s starting price is 1.50 then you can expect them to be priced at around 1.25 after they score the first break point.
If they are priced @ 1.80 they will move into to around 1.40. If they are priced @ 3 they will move into 2 and so on and so on.
From here you can use your common sense to work out where the price will move to if a break back point is scored since the prices will just return to where they previously were.
For example, if a player is priced @ 1.50 then scores a break point and moves into 1.25. If he is then broken his price will move back to around 1.50 once again.
To work out where a players price will move to if/when they win the set then you just take their expected price after break point and halve it again, or just divide their starting price by 4.
So if a player starts @ 1.50 then they will be 1.25 after they break and then go to around 1.12 if they win the set.
Lets look at a quick example to see how true this can be.
Here is an ATP match between Dimitrov and Stakhovsky. Here you can see that Dimitrov is starting at 1.26 favourite. Therefore, we can instantly get the idea that if he scores the first break point then we can expect his price to steam into around 1.13 or maybe 1.12 and then if he was to win the set we can expect his price to be around 1.06 or 1.07.
As said, this info is crucial when helping to plan out trades and measure risk beforehand.
Dimitrov scores the first break point after just 7 minutes of play and goes 2-0 up as you can see. His price moves into 1.12 in this case which is what we expected. Dimitrov is quite dominant so far and so it is no surprise that his price has gone right into 1.12 rather than the 1.13.
Now by this logic we should expect a price of around 1.06 if he was to win the set from here.
Dimtrov wins the set 6-3 and his price goes into 1.07. Not quite the 1.06 we were expecting but, remember, we are keeping the idea of the price going into 1.06 as a WORST CASE scenario. In this match Stakhovsky started playing better and won 3 games which is maybe why the markets went to 1.07 rather than 1.06.
But a tick difference is neither here nor there since, as said, it is impossible to predict the prices accurately.
How accurate is this?
As said, there are lots of mitigating factors that can affect the prices in-play. If a player breaks or wins a set in very dominant fashion then there can be a market overreaction and the prices might go further then you expected. The same if the player does not win a set in a convincing way too.
However, this is still a very handy formula for planning out your trades in-play and, most importantly, for knowing your worst case scenario.
For example, if a player starting @ 1.50 has just broken and has moved into 1.25 and I wanted to open a breaking back trade then I could quickly and easily work out that if my trade is not successful then my worst case scenario is probably a -13 tick loss if his price moves into 1.12 when he wins the set and if I decide to exit at that point.
Hopefully this article will inspire you to get involved in the tennis markets this week but remember I cover match reading and a whole host of other things in my Dynamic Tennis Trading course. There are 5 strategies included BUT the main emphasis is on trading dynamically and reacting to events as you see them develop. As said, this is the future of tennis trading on Betfair and probably the only way you can profit on this sport these days!
Remember, as a special deal for Sports Trading Life readers, I am offering a HUGE 33% off this course for a limited time only.
Visit this link > http://sportstradinglife.com/dynamictennistrading
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See you on the inside!