Friday, October 20th, 2017

Revealed – The Secrets Of How To Profit From Drifting Horses On Betfair

October 19, 2011 by  
Filed under Recent Articles

In this article we are going to look at what causes a horses odds to drift on the betting exchanges. And provide you with a low risk betting strategy to motivate and inspire you into creating profitable trades on drifting horses.

Momentum moves markets

Betting exchange markets perform just like any other markets. Whether it be housing or oil stocks, all markets are affected by Fluctuating prices. This movement is caused by momentum, which is fuelled by people jumping in and tipping the balance of the scales to one side. It’s a seesaw effect which takes place during the life cycle of any market or sporting event.

In sports betting the majority of Punters tend to follow what everyone else is doing because they:

a) don’t have the conviction to think independently

b) find bizarre comfort in Knowing when they do make a bad judgement, they are not alone

When trading on horses most punters tend to get involved at the wrong time through sheer impatience, which ultimately means they find it difficult to get into profitable positions consistently.

This is one of the main reasons why they give up on trading of any sort after only a short while.  In order to make regular profitable trades you must first take the time to learn how the exchange markets actually work.

Obviously we can’t go into great detail in this article, however what we can do is try and dispel some of the common myths and also share a simple but effective trading method that can be profitable if executed at the right time on the right horses.

What goes up must come down

Let’s say you identify a favourite in the Racing Post that looks to have a reasonable chance of winning based on its form, i.e. it’s rivals are ok but nothing special, and it has conditions to suite. You then head over to Betfair 20 minutes before the start of the race to place your back bet, with the intention of laying off at lower odds just before the race to create a risk free profit.

Unfortunately after looking at the horses Betfair graph you discover it has drifted from 2.5 to 3.20 and there is still money coming in to lay it, so for the short term at least it is likely to continue drifting, despite the horses form looking reliable and the tipsters supporting it. You begin to ask yourself why this is happening. Here are some probable reasons.

  • The forecast going has changed due to late rain
  • There is a  negative rumour going around about the horse in the live media
  • The market has totally overreacted and the mug punters are chasing the price upwards, fearful of not getting a lay bet on at the right price.
  • Other horses are being backed in greater volume than the favourite causing it to drift
  • Negative horse behaviour on live TV, such as:  playing up the start of the race, sweating badly or the un seating of a jockey.

Recognising market movement

Once the price of the favourite has drifted way beyond what it realistically should be according to its implied form chance you should look to do the opposite and back it against the market.

However, you must first be able to identify that the price has reached its peak. It’s no use backing a price that is still rising, if you do so then be prepared to trade out a.s.a.p. to minimize any potential loses because you are in effect chasing a price and liable to get caught out, timing is the key here.

There are also two other important scenarios to look out for…

  1. The price starts to stabilize and the graph goes side ways
  2. The price reaches its peak and starts to descend downwards quickly (Ideal if you get on as the price peaks, not as the price drops and then goes sideways)

Only consider backing drifting horses, (usually 1st or 2nd favourites) when their prices have drifted way beyond what they should be according to the form fundamentals. Basically, when you feel the price is completely exhausted, i.e. reached its maximum.

Assess the weight of money in the market.

Try to establish reasons why the prices have drifted so badly in the first place, is it because…

  • The masses have been laying in droves simply chasing the price upwards or;
  • Because sufficient money has come into back second or third favourites, causing an opposite but equal reaction.

Once you have done your assessment and decided that the price has reached its highest peak. It is then necessary to briefly look at the weight of money coming in the form of offers on the pink side, i.e. money to back the horse.

If that money is starting to heavily outweigh lay offers on the blue side, then back the horse at the best available price, with the view to trading it lower moments later. Very often these long term high price peaks eventually start to descend quickly leaving you with an opportunity to jump in and create a profitable trade alamost instantly.

How many ticks you decide to steal will be based entirely on the markets momentum at the time. The most important thing to remember is, get in at the start of a trend, not in the middle or when it stabilizes. Don’t get greedy; always take realistic profits because you never know when the tide may turn and a nice little profit can easily turn into a loss just by waiting for an extra few ticks.

To clarify what we have discussed above. I will give an example…

Jonny Favourites looks a reasonable prospect according to its form factors. The race looks winnable and its rivals are at best mediocre. However, a combination of external factors such as, a change in the going and negative media reports, cause the market to overreact and the horse drifts from 2.3 to 3.20 around 20 minutes before the start of the race.

After looking at the horses graph you decide the price has peaked, so a back bet at 3.15 is a good move. Before you commit totally you briefly look at the weight of money coming in the form of back offers on the pink side, confirmation is there.

Another quick glance at the second favourites graph confirms that this horse’s market volume isn’t going to affect you within the next few moments, so the tide looks about to change in you favour.

Your £20 back bet goes into the market and is matched at 3.15. About 40 seconds later the price has fallen to 2.80; you then secure a £20 lay bet at 2.80 which means you have created a FREE bet. If the horse wins you get £6.65, if it loses you lose nothing.

Alternatively, you could adjust the lay stake to £22.50 so a profit of £2.38 is achieved, no matter what the outcome of the race.

Cautionary pointers

1. Watch a plenty of racing markets

to observe and get a feel for what’s going on. Make sure to take plenty notes of any re-occurring patterns, especially on favourites that have drifted way beyond what they realistically should be.

2. Don’t chase a price that is still drifting,

You will be joining the que of mug punters and the price could still drift even further. Wait until it reaches a point where the odds of the horse have drifted way beyond what they realistically should be according to its implied form chance. Then if market indicators are present do the opposite and back the horse. You should be able to steel a good few ticks very quickly.

3. Assess if the odds have stabilised

If the price looks to have stabilized when you consider placing a back bet, assess how long it stays around that odds range. The graph may start going sideways. If it continues to do this for a little while that maybe the new established price range for the horse and money coming in to back it will be equal to that coming in to lay it.

When this happens the price is likely to just see saw back and forth within that range, i.e. (2.9 -2.88)-(2.92-2.94)-(2.96-2.98)-(2.96-2.94)-(2.92-2.9)-(2.9-2.88). Not a good time to get involved.

4. Avoid close races

Be very wary of races where the first three in the betting market are closely priced up, especially on higher priced horses, for example if the 1st three looked like so… 4.1, 4.6, 5.0 or similar.

These types often prove difficult to trade on an individual horse because all three horses are likely to be supported. In this situation it is difficult to spot any CLEAR INDICATION of when to enter into a trade.

Conversely in markets where there is a clear standout favourite that has drifted, you are likely to identify the necessary indicators a lot easier.

5. Bigger odds = bigger liabilities

Be aware that tick increments are very different for each price range, for example from 1.01 to 2.00 each tick value is 0.1. From 2.00 to 3.00 each tick value is 0.2. From 3.00 to 4.00 each tick value is 0.5. From 4.00 to 5.00 each tick value is 0.10 and so on. As the odds get larger so do the potential liabilities.  Your stakes need to be set accordingly, i.e. larger on the smaller odds, and smaller on the larger odds.

6. Accept losses

If you get it wrong accept it and close the trade immediately, the price may go in your favour it may not, is worth the risk in the end? If you can be disciplined, non emotive and act without fear you will be able to take advantage of trading situatuations that present themselves.

7. Be prepared

Work out the necessary maths using the WHAT IF FUNCTION on Betfair well before the off so you are prepared when submitting your bets into the market. This is very important because panic will lead to mistakes, ultimately costing you money through lack of preparation.

Alternatively, use a hedging calculator to work out the maths well in advance. Oddschecker.com has 3 or 4 free betting calculators on their website.

8. Betting Bots

The markets on Betfair move fast and manual trades need quick but informed reactions to be successful. There are plenty of betting bots on the market to help remove emotions when trading, make sure to review and compare some.

If in doubt don’t bet, there will always be other races to look at.

9. Backing  drifters and laying steamers

This approach could potentially make a tidy profit.  Betfair`s own research of 5644 races over an entire season came up with the following figures:

Drifters 2233 bets +231 points profit (backing
Steamers 3131 bets -349 points loss (backing)

Summary

Preparation is the key to success, like anything else in life learn to have patience and build your skill gradually. It’s always advisable to trade using small stakes on any new methods before jumping straight in.

If you want try this method a.s.a.p, keep stakes to the Betfair minimum of £2 that way any mistakes or loses will be very manageable and you definitely won’t lose your shirt.

Remember profit is profit, an accumulation of small profits add up to make bigger ones. Small and cautious is the way to do things, not big and dangerous. Keep things in perspective and you won’t get your betting fingers well and truly burnt.

Further reading

Steamers & drifters

About Jonathan Burgess

Jonathan Burgess is an official Betfair Accredited Trainer and racing columnist for various respected betting industry publications such as: Betting School, The Daily Punt and Betfair's Education site. He also runs the Profitable - False Favourites Betting Tips Club Which cost just 24 pence a day. You can also connect with him on Facebook and Twitter

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