Why You Must Test ALL of Your Betfair Trading Strategies First!
One thing that upsets me is when somebody loses money on a betting or trading strategy.
It's never nice to hear that someone has lost money, especially in an industry where we know it is possible to make great long terms gains on your financial investments by trading.
What is even worse is how most of the time this could have easily been avoided.
The number one most common mistake traders make is that they do not test a strategy first before putting money on it.
It doesn't matter if it is your own sports trading strategy or a system developed by somebody else, you must always test it without using real money first!
I will give you some perspective on this, just answer these questions for yourself:
- Would you marry someone before dating them?
- Would you run a marathon with no recent running practice?
- Would you invest in the stock-market with zero information on the investment you are making?
The answer to all of these questions should be a resounding 'NO'!
However, trading a strategy before testing it first is very similar to the three examples above.
So I asked a few traders who have made this mistake, why do it?
Here were some of the most common answers:
'I was just in a rush to make money, I don't have time to test anything.'
'Well, another trader had done well with the strategy, so I thought I didn't need to test it myself.'
'I just didn't really think about it and used large stakes straight away.'
Most experienced traders will look at the above statements and shudder a little bit.
To Pro Betfair Traders like myself, the thought of investing money into something before testing is just plain wrong.
But, as we know, many (perhaps most) traders do this at some point in their trading careers.
OK so I'm not here to have a go at anyone, I am here to help and teach people to trade sports markets on Betfair.
Let me address these statements and more importantly give the solutions:
1. 'I was just in a rush to make money, I don't have time to test anything.'
Why the rush? Would you not rather make money and take your time, than lose money but do it quickly?!
This is what will never compute with me, I wonder how much time you spend a week watching TV, playing games or socialising with friends.
All activities that adults do regularly, without thought, but we often claim - 'We have no time!'
As regular readers of my blog will know, I have a theory that 95% of people could find an hour or two a day to trade (7-14 hours a week) if they really wanted to.
For most people time is not really an excuse, you have it so it is your choice how to spend it.
People who try to rush at becoming a profitable trader rarely (if ever) do.
People who take a year or two to learn it properly have a much greater success rate.
If you are a member of Betfair Trading Community you will know this, having spoken to people like this on the forum.
Slow and steady wins the race!
2. 'Well, another trader had done well with the strategy, so I thought I didn't need to test it myself.'
Just because someone else has had success with a trading strategy, it does not mean that you will.
It is so important to test other people's strategies as you don't want to be relying on just that person for success.
You may find their style of trading does not suit you, or that you are not as profitable when trying said strategy.
No matter the strategy, how long it has been tested etc etc, you must always test it yourself.
Put it this way, do you want to invest your money based on someone else's opinions, when you haven't checked it out yourself?
I wouldn't, no matter how good at betting or sports trading they may be!
3. 'I just didn't really think about it and used large stakes straight away.'
People who are new to Betfair trading often just dive in at the deep end.
'Let's get stuck in!'
This isn't a weekend trip to Vegas, we are gambling to win, not for a good time (although I find winning feels very good!)
The only place you should dive into should be the learning resources at Betfair Trading Community.
Learn the game, learn the profession and do your due diligence before investing serious money into Betfair trading.
Take a minute to really think about your trading before you start going in head first at it.
You will likely save a lot of money at the start of your journey with the added bonus you are much more likely to make some later on in it!
Some people don't like to hear it but if you really want to be successful and profitable trader, then you simply must test all of your trading strategies first.
I use 3-6 months as a testing period, ideally with a few hundred results to analyse one testing is complete.
Make this a part of your trading discipline and routine and I don't think you will regret it.