Friday, 18 February 2011

Divine Intervention

After I had posted yesterday, cooked breakfast – eggs over medium (Americans are very picky about their eggs, as well as their men), eaten, donned my manly apron and washed the dishes, I realised that I should have included in my post on partners a comment about those of us with children. If wives and / or girlfriends can be demanding on our time, if we allow it, having young children certainly is too. My children are now young adults, (I started very early in life), so this is not an issue for me, but for someone looking to trade at a stage in their life when they have a young family, I think this would be an additional challenge.

Rowan, aka The Portfolio Investor concurs. He writes:

I found your blog after you very kindly wrote a nice paragraph about a piece on my new blog (The Portfolio Investor) recently and suddenly my "Page Views" took a sharp rise!

Your post today is the first I have seen that refers to the importance of a supportive partner. I don't trade, I run a portfolio of tipping services, and I also hold down a full time job and am a father to two young children. What I am trying to say is that I don't have much free time! If my wife didn't support me as she does (i.e. 100%), then it would simply be impossible to try to achieve what I want to achieve.

It seems that our partners have a lot in common. My wife never asks me how my gambling is going. When we have a big winning day she smiles; she shrugs and reminds me that the long-term performance is everything if I happen to mention that we've had a bad losing day. She is aware of the amounts being gambled and doesn't bat an eyelid, and she does everything she can to ensure that I can maximise my time doing whatever needs to be done. 
I find it interesting that Rowan says “when ‘we’ have a big day”. Personally, good days are things that “I” have, although the occasional bad day is one that ‘we’ have! There is no ‘we’ in ‘all mine’.

My wife also makes sure my time investing is maximised. Things like keeping the tea and coffee flowing may seem small, but I really don’t have time to be messing about with those things when I’m ‘working’. She understands that trading is basically a second job, and while I sometimes feel slightly bad that she’s doing all the cooking, lawn mowing, gutter cleaning, car servicing, shopping, painting, decorating, plumbing, electrical, laundry, dusting, ironing, cleaning and bill-paying, it’s really much more cost-effective for us to operate that way. I am, of course, exaggerating - she doesn’t do everything. I clearly remember paying the gas bill last October.

Rowan continues:
I agree totally with your comment about bloggers having a short time on the blogging world due to a lack of material to write about. I must confess that running out of subject matter over time is a concern to me, and therefore I am trying to encourage others to comment on what I write and engage in debate. Early days for me yet, but you seem to have the art down to a tee, and truth is that on a personal basis, I find that tremendously encouraging.

Of course now that your blog has caught my attention, I feel duty bound to start investigating the trading angle. My schedule seems to be getting busier!
Maybe you should check out Mark Iverson's post on his day at Centaur Trading before you take the trading plunge. I've never attended any training like this, but I'm not closed to the idea of it. I just fear that after seven years, the price of learning a few new things would be steep. For someone starting out in trading though, a day of training might be a worthwhile investment. Possibly the part of Mark's post I found most interesting was the final paragraph:
Two years ago these types of courses would have revolved around pre-race horse racing, but not anymore! The majority of attendees had little interest in the nags and nearly all of them spoke about how keen they were to trade the soccer markets. Should racing be concerned? I think so.
For me, you couldn't invent a sport that's more punter unfriendly than horse racing if you tried - and trying is something you can't rely on in that sport. Of course, that's just what the bookmakers want, and before you all start laying on the exchanges, remember that unless you have inside information, someone always knows more than you do.

I had another good comment from Mark a couple of days ago, which was:
Another great thought provoking post.

I think that regarding the lack of women trading sports, it may be worth looking at how people in general get into sports trading. I would say that the there are two main paths that are taken:

1. Punters on sports like football and horse racing who probably after years of backing selections with limited success found the exchanges and realised that they could become the bookmaker by laying selections, they probably soon realised that laying was not the golden egg they thought it would be, but in the mean time had learnt from the betfair forum etc about sports trading.

2. IT professionals who through their liking of sports found out about the concept of sports trading and because of their higher than average level of IT skills (I’m not including the IT bloke at my work place in that group) took to the technical aspects of sports trading like fish to water.

As far as I can see the main commonality between the two groups is that before they became sports traders both groups were probably interested in certain sports that are predominately followed by men . IE horseracing, football etc

So as a natural consequence more men would take up sports trading.
I’ve bored you all before about how I got into trading, but that won't stop me from boring you all again, so I will. My background in gambling is really quite boring. My Dad has never set foot inside a bookie’s, and at 83 is unlikely to start now, so I was never around gambling as a child as some people are. When I was a teenager, the only options for betting, other than the football pools which my Dad DID do (and incidentally won about £10,000 three years ago to possibly break even in his lifetime - he didn't even realise he'd won until the cheque arrived) were horses and greyhounds. I would see the prices on Saturday’s Grandstand, but never took much interest in them until one government mandated weekly Religious Studies lesson (called Divinity in my school) when the conversation somehow turned to how betting odds worked. My guess is that the teacher assigned to the task shared my opinion of religion and had no interest in filling our heads with nonsense. After that lesson, arguably the second-most important one of my school days, I now understood that 5 to 1 meant a probability of 1 in 6, the meaning of odds-on, why prices were quoted so ‘odd’ly (from the days when there were 240 pennies in a pound, and prices such as 11-8, 100-30 came about because of half-crowns) and how bookmakers built in a big over-round to be sure of winning. This lesson must have been pre-1971, because I recall someone asking if odds would be decimalised after Decimalisation Day which has just passed its 40th anniversary, but change comes slowly to racing, and it was only earlier this year that they finally introduced decimalisation friendly new prices of 7-5, 8-5, 9-5, 11-5, 12-5, 13-5, 14-5, 16-5, 17-5, 18-5 and 19-5.

The lesson piqued my interest in gambling, but at age 13, practical opportunities were limited to the occasional peer-to-peer bet with a school friend or running my own football forecast pool which deducted 10% for expenses and boosted my pocket money for a while. I certainly paper-traded though, and as I wrote three years ago in the About Me section of this blog, discovered the double up at a meeting system that was almost guaranteed to succeed, until my Dad checked around at work and came home to report that there one or two tiny flaws in my cunning plan. After my A-Level in Pure Mathematics With Statistics had further solidified my understanding of probability, and with little interest in horse-racing, my betting was limited. I do remember backing Red Rum to win the Grand National in 1975, and putting £2 on Crystal Palace to win the FA Cup at 66-1 in January 1976, a value bet in that they reached the semi-final that year, but hardly value given that Palace were a Third Division team and still had to win four more games. Then in the late 70s after switching careers and moving into IT, I got fairly serious about backing favourites in 6 to 10 runner Novice Chases and Novice Hurdles. Even though winners were frequent, with no value, I soon realised that even if the losses were small, it wasn’t the road to riches that I was hoping for, and that small losses soon add up.

Betting was restricted to social outings to places like Epsom, Goodwood, Windsor, Lingfield and Cartmel, and the occasional casino visit was for entertainment purposes rather than serious gambling. Told you it was boring. I just don't like to throw money away on losing ventures.

The next venture was my Elo ratings in the early 1990s, which were profitable despite being very basic. I used to buy the Racing Post every day, pick the best odds available, make phone calls to the appropriate bookies and as the 1991-92 season was ending with a profit, albeit after hours of work, I then blew the lot buying money on a Labour win at the General Election on April 1st. What a fool. That night, Neil Kinnock staged the infamous rally at Sheffield Arena and not only went on to lose the election, but more importantly, my money with it.

By then my children had arrived and were growing, and betting just fell by the wayside until I stumbled upon Betfair in late 2003, by which time the opportunities for the nerdy guy like me were plentiful with sports betting having expanded exponentially in the intervening years. With some experience of trading options and shares, an interest in sports, and the ability to invest £100 without too much hurt, the opportunity to get involved in sports trading was irresistible. To say that the £100 deposited was the best £100 I have ever invested, would be an understatement. As I have written before, that £100 is the only deposit I have ever made to Betfair. I turned it into four figures, and then into two figures - to a low of £21.40 – during my my apprenticeship, before getting serious and building from there. In hindsight, that loss down to within a whisker of busting out was probably the best thing that could have happened to me. I learned a lot.

My IT background isn't much help in itself, but what is of use is that solving programming problems requires the same logical thought process that solving how to beat other people on Betfair requires - with a touch of psychology thrown in to the mix, something that you don't need when dealing with computers.

I must say there have been some quality comments and posts in the blogging world this week.

And finally, this week's strange coincidence is that there is a new book about Bobby Fisher, whom I mentioned a couple of days ago, and I came across a review today. A quote from the review was "Few people more convincingly possessed both genius and madness than Bobby Fisher...grandmaster at age 15 and to anti-Semitic diatribes and various 'crackpot' behaviours in later life". I pretty much said the same thing, so if the IT and trading don't work out, I shall become a book reviewer!

1 comment:

HCE said...

A good read as always, Cassini. Yes, your quote about Bobby Fisher was spookily similar. I enjoyed reading your background to gambling. It is fascinating to learn how people get to the 'here and now' especially when you consider all of those cross road in life.