Although I’ve been profitable each month for a long time now, I’ve not managed yet to go an entire month without having at least one red day. (I don’t count April, June and August of this year because I traded very few days then.)
Now the summer (busy work time) is over I’m back to trading nearly every day. During November I really thought I was going to do it, but on Saturday 26th I made a mess of a trade and it cost me a red day to spoil the month.
I was so annoyed with myself I can’t tell you.
Luckily, I couldn’t trade on the Sunday or Monday due to other commitments and it was probably a good thing.
I’m only telling you all this because I have a bit of a reputation for being very disciplined with my trading, but I know I’d have struggled to blank it out totally and trade normally the following day.
That’s why trading is so hard. It really is tough to totally go into robot mode and not allow emotion to mess with your brain.
The fictional Spock of Star Trek fame may be able to be totally devoid of emotion, but it is tough for most of us.
Spock once said of humans, “I find their illogic and foolish emotions a constant irritant.”
Why does this bother me so much?
Getting one red day shouldn’t bother me, even the best of traders get an occasional red. The key to long term success is to minimise them and not let them wipe out a huge amount of profit.
I feel I have cracked that now, so why worry about one red day?
Well, it was ages ago now but someone on YouTube asked me to show inside my P&L on Betfair rather than just my excel spreadsheet. I never had any intention of doing that, because frankly I don’t care if people believe what I post or not. I do this blog for my benefit, no one else’s.
However, I did say to him that if I ever mange to go a month without a red day I’d happily show it off. I didn’t think too much about it then, but as time has gone by it has bothered me more and more.
This month when I got to about the 15th of the month, it started to affect my trading a bit. I was already thinking about it, to the point that I think I missed the odd trade from the 15th onwards as I was trying to be overly cautious.
The further the month went on the worse it got.
Also, if you look at my results for the 2 days after the red day when the pressure was off, I started trading much better again!
As luck would have it, I read a long twitter thread about “peak performance” this morning and I think it may help me. (If it does, I’ll post it up in my next update.)
Anyway, clock starts at zero again in December, so who knows maybe I’ll do it.
How reds affect losing traders
One of the hardest things to do is to switch Bet Angel off when you F a trade up. I guarantee you that every losing trader would be better off if they switched Betfair off as soon as they did a bad trade.
The money lost after the bad trade is almost always more than the original bad trade.
Andrew (B4P) drummed into me that “the red isn’t the problem, its what you do after the red that’s the problem”.
Thankfully I’m so much better at this now than I was 3 years ago.
Same old story
I get approached by lots of losing traders through my blog and most of them have the same issue.
I’m paraphrasing here but basically; they say to me.
“I trade 15 to 20 trades in a day with consecutive greens then I get a HUGE red and it wipes out all that profit. Then I go completely nuts and blow my entire bank chasing those losses”.
I did this many times when I first started trading horse races in-running. It is soul and bank destroying.
Well, there are a couple of easy ways to ease that pain. First don’t trade 20 races a day. The more you trade the more likely you are to make a mistake.
I have a certain criterion of race I’m looking for and I try and find the best hour to 1.5 hours of the day. That period that offers me the highest percentage of those races in that time slot.
Then I will switch off after one decent green or a couple of small ones or when the time is up whichever comes first. If that means no trade then so be it.
I concentrate intensely when I’m trading, looking for the right scenario to trade, so doing that for more than 2 hours is very difficult.
How people can switch BA on for the first race (before 12 noon in winter) and still be trading the evening races at Wolves is beyond me. Eventually you have to fall asleep at the wheel.
Once I’ve done my one good trade, I can switch off Bet Angel and bank my winnings. No matter what happens in any race after that I can’t possibly lose money on it. I’ll be doing my day job or lay on the settee watching TV.
Second tip to avoid catastrophic losses, you must set your stakes to “liability” not a fixed stake and make sure that the settings mean if a trade goes completely tits up, it will not take more than 5% of your bank.
Bankroll management is crucial.
The positives from the month
So generally, a very good month, I traded exactly 50 races through the whole month and that includes scratch trades.
Regarding the scratches, sometimes I enter in anticipation of something and it doesn’t happen or I enter what looks a good trade but things change, so I instantly trade out. With these I might be red/green for a couple of pounds.
If you take out my scratches, I did 42 proper trades. That pleases me.
Why don’t I use bigger stakes?
Someone on Twitter asked me this recently. So, I thought I’d answer it here.
Comfort zone is the easy answer. No pressure trading is fun, and I enjoy it.
I’ve won just over £600 this month which probably puts me ahead of most people on the Betfair exchange, who trade horses. There are certainly people with part time jobs who don’t earn that much.
There have been times in the past when I really needed the money I was winning from trading, and no one should really be trading under that sort of pressure. Now my business is going well again I’m way more relaxed and really enjoying it again.
Who knows, I‘m sure that over time I will start to increase my stakes a bit, but for now I‘m quite happy as I am.
Another twitter user said in reply to one of my posts that I would have “been better off flipping burgers m8.”
He is 100% correct, which is unusual because most anonymous accounts on twitter spout total boll*cks.
So, after reading his insightful tweet I did research the possibility of working for McDonalds as a way of increasing my earnings potential and this is what I found.
If I worked 5 days a week x 7-hour shifts, then my 35-hour week at Mackkie D’s as a “crew member” for £8.48 ph would equate to £1,286.13 per month gross which would be about £1,206.78 net.
Now that’s double what I’ve “earned” trading this month.
But as I’m a lazy sh1t I didn’t fancy it. I worked out my hourly rate from trading to see if I could justify my laziness.
These days, I NEVER trade for more than two hours on any given day. Even allowing for the fact that I count study time, watching videos and race replays, as time spent trading I still don’t do 2 hours per day.
If I had to guess, I’d say my average time trading each day is about 30 – 45 minutes. Quite often I trade the first race I watch, like I did today, and switch off immediately.
Each day I watch Andrews (B4P) racecourse guide videos for any tracks I may be trading that day to double check my “last entry/exit points” which is about 5 mins a track and I take a few mins reading the Telegram room posts or putting up a screen shot on twitter.
As I don’t trade every day, then unlike McDonalds I’d say I average about 5 hours per week with Bet Angel switched on. So, my hourly rate is pretty good.
If you check my comments in the Telegram room today they are 4 minutes apart. So I was probably actively trading for about 3 minutes. After commission I got £44.82.
Now today was particularly short but on average I’d say I’m earning at least £25 an hour (tax free) even at my small stakes.
As every poker player knows, money won is twice as sweet as money earned. So I won’t be applying to McDonalds for a job anytime soon.
OK month, steady as she goes. Maybe I’ll go red free in December!
I’ve been a member of B4P for getting on for 3 years now and if you’re interested, I’ve written review(s) about it which you can read here.