Preparing to trade a major meeting – Cheltenham

Big race meetings

Big meetings are generally mean big opportunities for me, so I take a lot of care to carefully prepare for each one. Trading Cheltenham is a big opportunity as it’s one of the biggest meetings and the Betfair exchange, in fact, all betting exchanges will be flush with liquidity.

These are strong betting markets and if you don’t like the crazy amounts of money and large queue sizes when you are Betfair trading. You may find stepping back to Betdaq works well during the meetings. But especially so for the feature races, like the Cheltenham gold cup. Price movements on something like Cheltenham are a bit different from your day to day jump racing markets. Prices move in much more shallow patterns generally and volatility is lower.

Most years the big meetings, including meetings like the Cheltenham festival, account for just short of 20% of my entire year. That’s why I put so much effort into each one. Not only that, while invites are always gratefully accepted, I’m still politely declining them. I intend to do so for as long as is practical!

So let’s have a look at how I prepare for Cheltenham when trading on Betfair or any of the other betting exchanges.

Collecting and analysing data

When a major horse racing meeting is on the horizon I have already done a lot of work ahead of it. I always have tons of data to analyse, because when I trade, I also collect data. Bet Angel is actually well set up to help you achieve this as you can run automation and/or spreadsheets in the background while you carry on with your normal trading. Therefore new data piles up in the background for you to look at later. After the event is over, be it racing, football or Tennis, I sift through the data and see what worked and if I could have done better. It’s the trading equivalent of Kaizen.

Collecting data in this way allows you to reflect on what happened in prior years, but it can also tell you how the market is changing and anticipate future change. As the festival gets underway I’ll make an effort to blog what I see, so you should be able to see my observations. You can hypothesise what is going to happen, but you will only know for sure when it gets underway.

I still screen record my trading!

You may be interested to know, that I still record my own trading, especially ahead of big meetings. When that roar goes up at the Cheltenham racecourse, my first video will have been complete and I’ll be looking at the data at the end of the session. Recording the screen and my trading software gives me the chance to relive the meeting again and remember what it felt like. I’ve already watched last years races and it brought back a lot of memories, mainly good it has to be said 🙂

I tend to keep notes next to each meeting as well, as that reminds me of what I am thinking and how I reacted to what I saw. It’s a mental note of how it felt, so I re-read those.

General Cheltenham observations

Of course, with Cheltenham comes with some of the biggest sports betting markets of the year. The highest turnover race will most likely top £10,000,000 in matched bet volume, so this is a big meeting. Plenty of conventional betting, Betfair trading and the odd lay bet in the big fields. So while Cheltenham is view favorable, it often doesn’t suit peoples individual trading styles. On average last year, each race reached £4.5m, so that ranks around nine times greater than the average race.

However, it’s not just about the amount matched as it’s all relative. If the rate the money is being matched is also nine times higher then the net effect is no different at all from a trading perspective. If you switch to another exchange you need to know the same information as well. I have observations from both, I’ll give you more data on this as we move into and through the festival.

Cheltenham advice

One thing you will not be short of at Cheltenham is advice. There will be tons around and a lot of it free. Everybody has an opinion from a betting perspective.

The festival is often dominated by competitive handicaps of impenetrable complexity. Trying to unpick some value from that is tempting, for the potentially huge payoff, but almost impossible. Make sure you leave the traditional betting on the other side of the book! Traditional gambling and trading do not sit comfortably next to each other.

Inplay observations

One area I looked at more than in previous years was the in-play market. It’s interesting to see that Cheltenham is one of the least variable courses on the spreadsheet. Basically, if you are looking for a big payoff, they can happen, but they happen much less at Cheltenham. You can actually stick a number of it. The average variance of in-play is 25% lower than the most variable course in the UK. Some food for thought.

One thing you can be sure to pick up if you trade in-play, however, is a drifter. Only one horse can win the race, that will trade near 1.01 so everything else will finish at or near 1000. Last year the average field size was 17 so you have an average of 16 losers per races. OK, very simplistic there, but field sizes are 70% higher at Cheltenham than ‘normal’. I’ll chuck over some more stats in as we get towards the festival.

Don’t forget the bread and butter meetings

With all the hype surrounding Cheltenham, it can be easy to forget that the big festivals are just a minor part of the 10,000 or so races that face us every year. So never forget that 75% of all races are grades 4-6, that’s where your year is made or lost. While we are still awaiting spring, there is still plenty around to get tucked into and build up that trading bank ahead of the big meetings.

Cheltenham traded range

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