subject: Lesson 1 - What is Sports Trading? [print this page] Lesson 1 - What is Sports Trading? Lesson 1 - What is Sports Trading?
Sports trading is a daily occurrence in sports betting market. The differences between people opinions lead to different prices or odds which in turn create profitable trading opportunities. Since odds function like prices, the traditional buy low and sell high concept can be applied.
Sports trading can take two forms. In the static situation, a sports trader will identify differing prices across bookmakers and simultaneously place bets among the bookmakers to secure a profitable trade. This is known as sports arbitrage trading. The other form of trading which is the focus of this course would be trading across time. In this situation, the sports trader will first place a bet with the intention of closing the trade in the opposite direction after the odds had moved in the intended direction predicted. The sports trader would then have executed a profitable trade when that happens.
Since the exact price can never be placed on any outcome of a sporting event, prices fluctuate widely across time as a result of differing human opinions. As such, sports trading opportunities are endless and present themselves all the time across almost all sports events.
Sports trading almost exclusively take place on betting exchanges. This is due to the fact that ONLY betting exchanges allow anyone to set their own odds or prices. A betting exchange functions like a marketplace where people can buy or sell odds to each other with a low commission granted to the betting exchange for the service. In essence, you can be a sports better or even your own bookmaker! As long as you are able to predict the direction of the prices, countless profitable trading opportunities exist.Betfair is currently the largest and most well establsihed betting exchange.
Sports trading also has several notable advantages over conventional sports betting and other gambling:
Far less risk
Can profit from any sports event outcome
Not competing solely against bookmakers but also the general public
Low capital requirement
Greater chances of successs
In sports trading, you always have the option to trade for a small loss or end your trade with a small profit, thus minimizing risks. In the event you finished the trade before the event had even begun, you have secured yourself a locked profit since the event outcome has no bearing on your profitability. When this situation occurs, you have essentially created a riskless profit for yourself.
In sports trading, you are competing against other traders and gamblers as you trade. Compare this to the traditional sports betting approach where you decide or not to take a bet with a bookmaker odds. All in all, this means that the chances of succeeding in sports trading is much higher than in conventional forms of sports betting.
The author started out exploring sports trading as a home project as it is easy to set up. With limited capital, the author was pleased to know thatBetfair allows people to place bets in cents. Starting as a small trader, he was able to generate a few hundred a month to eventually becoming a full time sports trader.
In order to succeed in trading, one must use a basic mathematical principle and model to create profitable trades for himeself. This model of backing and laying will be discussed in the next lesson.
