Choosing longer winning streaks

[stueytrader]

Had a thought, inspired by a couple of posts (footy and horses) about laying long shots as an approach. A key aspect of those kind of approaches is long stretches of wins, with much more occasional losses.

Do you consider the type of winning/losing run you will likely encounter when selecting your chosen strategy(s), or ignore that in favour of purely how much profit you can make overall?

I realise that making say 10% of bank on average from a strategy laying even money shots is exactly the same in profit terms as one laying 20/1 shots that also makes 10%. But, would you chose one over the other (hypothetically if you didn't chose both of course).

The hidden factor here is how your trading results affect your subsequent trading ability. Personally, I have gradually favoured higher strike rates (longer winning streaks) because I react better to occasional losses. It doesn't alter my trading after a loss. I've used other strategies that lose more frequently (though potentially overall just as profitable) and feel they may have reduced my later performance after a string of the losers.

Just wondering if other (manual of course mostly, though poss also the auto guys) traders consider this factor?

[ShaunWhite]

Being auto my only consideration is the potential drawdown but that would apply to manual stuff too.

If your 100/1 winner takes 300 races to come around that can be a lot more uncomfortable than if your 1.01 loser takes 300 races to come round. You can also develop that syndrome like doing the same lottery numbers and you daren't miss one in case it was the winning one. Whereas the small gains approach allows you to miss the odd race because you're losing £1 and maybe dodging that big losing bullet.

Mathematically of course there's nothing to stop both having the same drawdown, but one happens quite quickly and is easy to get over and the other is a long slow sometimes painful slide. I used to run something that 'should' have paid out every six weeks, but it would usually go 3 months and then have 2 winners on the same day. The drawdown was more prolonged and painful than short sharp shocks, and the prospect of missing the winner meant I daren't miss a single race.

As usual, #years at the coalface (aka experience) and depth of pockets probably allows you to be be much more pragmatic, and just go for the best bottomline option rather than being bothered about how it gets there.

[stueytrader]

That example of chasing the big winner is the extreme example of losing streaks yes - you'd have to expect a long string of losing ones before hitting any. Personally, I can't be comfortable with anything like that. It seems impossible to tell yourself you are 'doing things right' or making progress.

Of course, winning loads of 300/1 lays in row, or similar, can be a form of fooling yourself in just the opposite way.

I favour somewhere inbetween, which probably most do, but more towards the 'laying the longshot' side of the spectrum. Steady wins, but without kidding myself there will be no losers in my records.

[stueytrader]

The problem with my approach is again that it takes me some time to know whether I'm just in a lucky run, or that the strategy is actually profitable long term. I'm working on that problem.

[wearthefoxhat]

I think Shaun (and Derek) have covered the idea that it's about what constitutes "value" when laying or backing initially.

If the longshot @100/1 is really a 500/1 shot, then laying over 100+ selections in a row is more likely/probable.

Backing @ 1.01 is doable, if the result is more or less known already. Back in the day, there was a guy I knew in Guernsey that had a feed that was 2 seconds or so ahead of the market. He filled his boots sometimes better than 1.01, (hence even more value).

For me, the best long term laying strategy is at the lower odds range. If I find one that should be 10/1+ and can lay @ 5.00 or less, then happy days. Unless it's a Barney Curley coup down from 20/1 to 1.50, then I'm fooked...

[Atho55]

Laying 3-3 in a football match is a classic example of a potential long winning streak as it does not happen too often but does happen. But is there another way to look at it. If you know it does not happen very often why not select games that have a 3 or more goals already before entering the trade. It`s still only going to happen the same amount of times but your liability will be considerably less as BF adjust the odds for it.

Try to find the point where the trade would break even.

[ShaunWhite]

If you know it does not happen very often why not select games that have a 3 or more goals already before entering the trade. It`s still only going to happen the same amount of times but your liability will be considerably less as BF adjust the odds for it.

?
3-3 will happen more often when you only select games where there's already been 3, that's why the odds are shorter. Or have I misunderstood what you mean?

[Atho55]

For arguments sake I have records of 52 3-3 final scores from 5700 matches. If 3 or more goals have been scored at HT that can still end in 3-3 then 32 of the 52 end in 3-3, on the other hand 576 do not end in 3-3.

The odds to Lay should be lower and so will the liability than at the start of the game on the games BF see it as a potential 3-3.

It`s then about finding the odds to go in at that reflects the outcomes.

[Kai]

The hidden factor here is how your trading results affect your subsequent trading ability. Personally, I have gradually favoured higher strike rates (longer winning streaks) because I react better to occasional losses. It doesn't alter my trading after a loss. I've used other strategies that lose more frequently (though potentially overall just as profitable) and feel they may have reduced my later performance after a string of the losers.

Just wondering if other (manual of course mostly, though poss also the auto guys) traders consider this factor?

Generally speaking I feel it does play a role. Your overall confidence levels should be fine because they reset after every trading session and revert to mean, but if the markets and opportunities come thick and fast at you then your temporary confidence may take a bit of a knock, and that can have an impact on your current performance and decision-making. For me it's more about getting annoyed about bad markets and bad opportunities than anything else, so I actively look to avoid getting annoyed if possible, if the level of effort required to get something out of that market is so high that trading it hardly makes it worthwhile.

[stueytrader]

Good point about resetting Kai. I don't think a losing day will affect my trading ability much the following day, however a run of losing ones can seem to affect my ability for the next trade on the same day...
It can just become too much of a distracting thought within trading thoughts that are necessary to function.

[TipTopTrader]

Stuey,

It can be a really dangerous and brutal game, laying long priced runners.

If 3 or 4 get up in the same day, you will feel like resetting off a bridge.

Its so easy to over stake them. Under research them. under value them.

I'm not against the strategy. I'm just trying to remind you that the first lay you make might win, or the first 100 could lose.

Speaking from experiance its brutal when they win. Expecting something to lose is worse than expecting it to win for me anyway.

There is value in laying them, it just has to be the right ones.

My advice would be always remember you need to put as much time and effort into laying a roughie as you would a shorter priced runner. Its just as hard as trading, and backing winners.

Some on the job training will give you a good idea if you have the stomach for it or not. You might be ok with it.

I do lay horses. I'm laying a horse in race one Cranbourne no 12 Toffee Tongue.There is small money at around 5 dollars now.I think it should be 10, 12 to one.I still know that it could win.

If you stake to lose 4 or 5 % of your bank you should be ok if you have an edge.

Best of luck with it.

[stueytrader]

Yep, I do get those points Tiptop. I have come across some of those sticky runs previously in fact, the days when 2 or 3 of the lays hit home - yes, it is difficult to deal with that.

I should clarify, I'm not actually laying the extreme long shots (that was just for discussion), I'm more a mid-odds kind of layer, and I do have strict staking in place, to protect from poorer runs.

With a decent approach wins cushion the bad runs, as in any strategy, if you're doing it well enough. It is hard, like you say when the bad run hits in laying.

[TipTopTrader]

Maybe I should revist the idea myself . I should take my own advice . Well researched and staked.

I could be leaving money on the table. There are way more I don't like than I like.

I sometimes find trading can tilt me the most

[wearthefoxhat]

Well...if you had a go yesterday @ Newcastle Laying the outsiders....

Newc.GIF

[stueytrader]

Didn't play Newcastle, though those ones are a little bigger than I'd lay even so.
Would certainly have been a big drawdown for those who lay at those prices if they'd done the lot!