The Betfair Trader / The Betfair Trader / 09 November 2007 / 2 Comments

The Betfair Trader is left stunned by the market's volatily in yesterday's ODI between Pakistan and India and pays the price

http://15 minutes of pain

Yesterday's Result: £623.86

It's not quite what Andy Warhol had in mind but I reckon it's true - every trader has their 15 minutes of pain. Unfortunately yesterday was my turn and I managed to turn a several hundred pound green book in to a several hundred pound red one. Several hours good trading wiped out in 15 minutes.

I'm realistic enough to know I can't win every time I trade. And I don't normally let losses bother me. Just take them on the chin and move on. Yesterday's really bugged me though so I allowed myself a brief moment of melancholy before heading out to cheer myself up and catch a Stone Roses tribute band - which turned out to be cancelled! :-(

I made the loss on the 2nd ODI between India and Pakistan. Put simply I got caught by an odds swing of seismic proportions that still somewhat baffles me. With around 10 overs to go of the Pakistan run chase I was sat there with a green India, red Pakistan and a smile on my face. Pakistan needed over 9 runs an over, I effectively had an all green book, India were around 1.5 and I knew the price I was going to bail at for an all green book if it looked like Pakistan might do it.

3 balls and 10 runs later and the price was evens. Another 3 balls later and the India price hit 2.66. So in one over the Indian price went from 1.5 to 2.66. And what had happened? The Pakistan required run rate had dropped from just over 9 an over to just over 8.5 an over. I don't know. Maybe I just read it totally wrong but for me that was a massive over reaction on the back of half decent over.

Anyway, whatever the reasons the fact is the market just ran away. Paniced. Stampeded even. Even with my trusty one click trading software I could barely get matched. By the time the 5 seconds were up and the bet had been submitted the market seemed to have drifted another 5 ticks. I finally got everything I wanted matched but by the time calm prevailed and the market settled I was staring at an all red book. I was stunned. It felt like I was in the scene at the end of Trading Places where the Duke Brothers are left standing among the old orders strewn across the trading floor after being ruined by Eddie Murphy and Dan Ackroyd!

Of course the market had over reacted and as it settled it back a little. Pakistan continued to stay up with the rate though so I backed them - still well odds on - in the belief they would win. A wicket immediately fell and India were back to 1.5. At that point I thought sod it, equalled out red and simly left the match. It was only going to get more volatile and as the volatility increased getting involved would become more and more of an outright gamble. It was time to accept the red and quit.

So there you go. 15 minutes or so of pain in which I swapped a healthy green for a sickly red. I was literally caught out by the scale and speed of the price swing. Not really seen anything quite so big at that stage of a match before but you can't argue with the market. Guess I just read the whole thing incorrectly and paid for another lesson. The thing that really got me after was it wasn't as if I was unwilling to level my book out. I intended to and knew when I would. When I reached that point I just couldn't get matched.

Anyway, all behind me now and on a more positive note I have all green books on the two tests going on at the moment - Australia v Sri Lanka and South Africa v New Zealand. Small in the first and moderate in the second although with those two - and the ODI - running at the same time even my new bankroll wasn't sufficient to enable me to take the size of positions I wanted on the South Africa test. Bit of a shame as my initial lay of the draw in that was a more profitable position to have taken than my original one in the Austalian match. I mentioned this might happen and I may have to increase that operating bankroll. Might be that I'll end up doing it sooner than I thought.

To read more from the Betfair Trader go to:

http://thebetfairtrader.blogspot.com/

Tags: cricket betting, cricket trading, ODI cricket, The Betfair Trader