It’s common to see people complaining about liquidity this time of year and I noticed another comment this morning so I thought I’d share a quick update from today…
Typically, I don’t trade on a Monday afternoon (especially this time of year). The reason for it is simple; conditions aren’t optimal. However, peak conditions are far different to untradeable conditions. When you’ve been doing this for as long as I have, that obsession to trade everything wears off. Targetting maximum profits for minimum time is far more appealing!
That said, I did spend a little time on the ladders today…
Genuine money flow was late, traded volume was weak and the price activity was skittish, to say the least (see 3rd runners chart below).
…if you employed the right strategy.
Click for full-size image:
This is the key takeaway here – adapting your strategy matters (a lot).
The racing trading strategy that you use is dependant on the market conditions available to you. This is our job, to trade what is available, not what we want to be available.
Trading 10 minutes before the start in today’s conditions would have led to all sorts of problems. To name a few:
- Difficult exits
Chances are, most new traders would have been chasing their position around the market getting frustrated (causing skittish moves).
When there’s not a genuine flow of money, you have to give away value to exit your position. The market can’t take very large stakes, leaving you overexposed. This leads me on to the next important point…
Reaction v’s Prediction: The Above Example
The trade shown above (see stakes on the left) was made within the final 3 minutes before post. It was a relatively small move, although it was on the favourite where there was plenty of liquidity for the size of stakes used – £400. The risk was extremely low as I was merely trading a market correction. I was “reacting” to something that was already happening instead of attempting to “predict” the future.
The result – low stress, low risk, stakes that fit the job and a strategy that was reliable.
To me, this is what all good trading is about. I simply couldn’t have traded the same way I would a feature race on a Saturday afternoon, so I didn’t try! Be patient, pick the right strategy and manage the downside and the rest will work itself out.
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There is a guy on Facebook called Betfair trader who openly admits that he manipulates prices by weight of money thousands at a time and offers people to invest in his winnings for a 40% take from him ..this cant be right surely ??
Have no idea, bit strange he doesn’t want to show his name though right? Have a think on it…
Thanks, Caan. Such a good and useful article!
Last Monday was not good. I had a few hours to myself on that day and opened up GT to trade but the markets didn’t feel right and ended up taking a couple of small losses in the first 2 markets. After that I just called it a day. I had a decent weekend trading so I have learnt (the hard way) to pick and choose your moments as there are plenty off better opportunities elsewhere; the markets aren’t disappearing anytime soon (we’ll unless COVID takes another hold).
I used to be very insecure and felt that I had to trade every race as not trading something would mean I am a failure. I soon got over that as Caan and the other pros always say sometimes doing nothing is winning