11. Which sport should I trade?
Every sport is different in many ways - in terms of rules, popularity, the frequency with which the games are played, etc. Each sport will therefore be different for trading and also the markets will look and act differently. In this article, I will highlight the 3 most popular sports on Betfair & Betdaq. For additional understanding of the key sports and markets, please check out the video included with this article.
Tennis
In tennis, there are only two possible outcomes to the game:
- Player A wins the game
- Player B wins the game
There is no draw. Before starting the game the odds both players have will move very little, because betting world has calculated the probabilities and there is little room for speculation.
In contrast, when in play a tennis match it is very volatile and prices on each player move after each ball, depending on the score of the game. For example, if player A wins the first set 6-0, the price will drop considerably, because there is now a much higher probability that this player will win the match.
It is also good to know that the highest liquidity is on the most watched events of the year. For example, in the Wimbledon final tens of millions of pounds are traded. In short, the more high profile the match, the more money will be on it. And more money = more potential for earnings.
Tennis matches around the world are played throughout the year, except in December, when the season is interrupted.
Football
In football there are more variables. Firstly there are three possible match results:
- A team wins
- B team wins
- Draw
Additionally, there are two teams of 11+ players. As such, there are many more factors that can affect the outcome of the match, so even before the match begins, speculation can be made on how the game will end. Speculation about how the game will end influences the movement of the price. For example at one point, people think that there is a greater probability of team A winning, but then after few hours, information comes to light that the key player will not play, so the prices may begin to move in the opposite direction. Such situations in football can occur often, and it means that this sport is much more suitable for pre-match trading than tennis.
During the match the odds will move again depending on many factors in the game. It is the same as in the trading tutorial where we have shown how the price can change after a goal is scored.
As with tennis there will be higher liquidity on higher profile events and leagues such as the World Cup, English Premier League or the Spanish Primera Division.
Horse racing
In horse racing there are many factors that can affect the outcome of the race. A horse race can comprise of 2 or more runners, and it’s not unusual to see 20 horses participate. Races can be of varying lengths, with different ground conditions, jockeys and horses, and all these can affect the outcome. In short there are so many factors, which is why it is not as easy to correctly calculate the probability of a horses chances of winning. Since it is not easy to calculate this probability, there is much more room for speculation compared to tennis and football. This means that before the start of the race prices on horses compared to tennis and football are much more volatile.
Horse racing is the most popular choice for those who want to trade on betting exchanges without any understanding of the sport. You can trade them without knowing anything about this sport and I am proof. I still do not really understand what Handicap or Maiden Stakes means, yet I have traded horses successfully for several years.
Horse racing in the UK and Ireland are run throughout the year, except for two days - Easter and Christmas. Every day, every 5-15 minutes, for a few hours in a row, there a race on which you can trade.
Every year in the UK and Ireland there is around 10,000 races, so if you can manage to average £1 profit on each of them, it is a reasonable tax-free income.
The biggest events in the year are Cheltenham Festival, Grand National, Epsom Derby and Royal Ascot, and there are tens of millions of pounds traded on them.
Other Sports
Of course you can trade any sport on Betfair & Betdaq. Other popular sports for trading include cricket, darts, golf, basketball and many others. There is always one rule - the more popular the sport or game is, the more liquidity it will attract and the greater is the potential earnings. The key principle of trading is the same for all sports – Back high and Lay low. This principle can be applied to any sport, so it is up to you which sport you choose.
