Take it from me, I know from bitter personal experience that one of the worst feelings in the world is watching the last favourite of the day get beaten by a mile when you have bet your bank on him. This is a situation that you may or may not personally have been in and I hope you never have but it illustrates why many people struggle to make any money at all, let alone a regular useful income from sports betting/investment. Lack of discipline, meaning chasing losses, increasing stakes after a loss (sometimes to your whole bank!) and placing random bets, is symptomatic of a gambler as opposed to a shrewd investor placing wise bets with a high chance of winning. Read on for some tips on how to maintain discipline in trading or betting on forex or sports.
Let’s start at the beginning… I don’t like sport. I have no interest in horse racing and I don’t even like football. What I am interested in is money and the easier the better. It’s not hard to see how I could be sucked into the world of gambling and trading (to me the two are very similar things, wearing a suit and a tie and working in the city does not make what you do any more legitimate than the guy on his sofa with a laptop betting on horses, it’s about a percentage return on your investment and the lifestyle you achieve by it).
When I first began in my endeavours to make money from sports betting it has to be said that I knew very little about just how hard it is to do. People have spent entire lifetimes and still failed to find a consistently profitable method to make money. It’s no surprise that I lost money hand over fist at the beginning. After much reading and buying systems of dubious quality from the internet I realised that to be consistently successful I had to follow certain rules, a system, but that the most important thing was to stick to the system no matter what.
Even once I had found a system that I felt I could follow I still did not make money straight away as I would get bored and deviate from the system or try to second guess my system and place bets not in accordance with the rules. Dealing with losses was also a problem. As soon as my system encountered more than two or three losses in a row I would lose faith and start increasing stakes to try to recoup the losses faster and inevitably end up betting the bank on the last race of the day.
If you recognise anything in the story above, maybe you have been or still are in the situation above, then read the tips below. This information is certainly nothing new but I have presented it in the way that I personally used it to develop a degree of discipline in my own investments and that ultimately helped me to start making money instead of giving it away day after day.
1) Use a betting bank. A betting bank is simply an amount of money that you only use for your sports investments. The purpose of using a betting bank is so that you can quantify the amount of money that you risk on each event that you bet on. A betting bank is usually split up into points. I like to work with a percentage of my bank and only risk a certain percentage of my bank on any one bet or trade. As soon as you have done this you have insulated yourself from the downside of trading/betting… the losing run. I know of no system that will pick only winning horses/football teams/shares/forex trades over and over again with no losers therefore it is inevitable that you will sometimes lose. The sooner that you accept this and move on the better. Using a betting bank allows you to suffer a sustained period of losses but still have enough money left to keep you in the game and then when the winning run happens it turns out that overall you are up.
2) Record every bet or trade that you make. This is one of the hardest steps to take towards disciplining yourself. I can use excel to a reasonable degree and so I knocked up a few spreadsheets with the information of each bet/trade and the profit/loss. I also made charts with my p/l and also drew a target for each day. If you can’t use excel just write the information down in a diary or even a plain pad of paper but make sure that you refer to it every day and write your bets or trades down every day so that you have an accurate record of your activity. Use a separate spreadsheet or sheet of paper for each different system that you use, this way should you place a bet or trade that isn’t in accordance with your system you’ve got nowhere to write it down! This helped me focus on sticking to the rules of my system.
3) Learn to accept small wins. If you feel like you’re winning you’re probably betting too much on each event. Read that through again. Another way of expressing it is to say that if your heart rate increases on each win you’re risking too much on each bet/trade. When I first started out I wanted to win and to win big, that’s what you do it for, right? That’s probably why you’re reading this, right? It’s what everyone wants. My point is that to win big you have to learn how to win small. What are the chances of winning the lottery? Pretty small but when you win you win big all in one go. The chances of you finding a betting/trading system that will win big consistently enough to make you rich overnight are probably just as small. Learn to love the small wins because when they add up they will amount to something big.
4) If you’re losing and feel the urge to bet the bank… run! The urge comes to me over and over, I want a big win now, I want the thrill, I want the money. When you get this urge the best thing you can do is to shut the computer down and go for a walk in the fresh air. Betting/trading in this way is definitely not sustainable, eventually you will lose and lose everything in one go. Just don’t do it.
5) Avoid alcohol and betting/trading. After a few beers it is much harder to maintain discipline. You may enjoy a few beers while you watch the match but if you’re trading on it leave the booze alone, it lowers your discipline threshold and leaves you prone to meddling with a perfectly good system.
6) Think of your betting/trading activities as a business. Referring to the above, would you turn up for work after having had a few beers? No, so why trade drunk? You can read it everywhere on the internet that gambling winnings are tax free. This is true to an extent but as soon as your gambling activities become your main income you are liable for UK tax the same as everyone else. If you don’t believe me check with your local tax office. It’s then that your carefully kept profit and loss diary becomes even more useful.
These tips helped me on my way to maintaining the discipline I now use to stick to my systems. Follow this advice and I’m sure you will find it easier to do the same.
Edward Munroe is a grammar school educated lorry driver who is in the process of building a fortune the hard way. Starting out with next to no money he has spent the last five years in a vicious circle of long trial and hard error until finally finding the right methods to make money from forex and sports trading. Although now on the road to riches it will take time to build a steady, regular income and so Edward is currently seeking offers of alternative employment (salary in excess of?35k pa) in the South Wales area. In addition Edward is in the early stages of writing a book about his successes and failures in the trading and gambling world, his early trials and tribulations through to his breakthrough into profitability. Any publishers who would be interested in this book are also welcome to contact the author at the address below.