What is swing trading on Betfair?
Swing trading is a form of trading movements in the price of something. In the context of betting on Betfair, swing trading means trading the movement in odds priced on various sporting events. Think horse races, tennis matches and soccer games. Betfair traders attempt to do what any type of trader does and that’s to make regular profits in ‘the market’. Swing trading on Betfair involves placing back and lay bets on certain selections. The key is to place a back bet at odds higher than the lay bet or vice versa. In other words back high then lay low, or lay low and back high. The result is to guarantee a profit no matter the outcome.
Swing trading on Betfair is not to be confused with Betfair scalping. A scalp would look like this (Betfair has decimal odds); back at 3.50 and lay at 3.45. Only a very small movement in the odds is required, which produces a small gain. A swing trade would be more like this; back at 3.50 and lay at 3.38. In some cases the difference between back and lay odds can be much larger, which is great, because larger differences mean bigger profits. Swing trades on Betfair involves larger movements in the odds.
What moves the odds?
In a nutshell it’s opinion that moves the odds. Movement of Betfair odds can be caused by movement in the odds of traditional bookmakers, tips from tipsters with a large following, forums, tipster websites, and general news flow online and off line. For instance, say, a well respected tipster tips a horse the night before the race. The tip hits the mainstream the next morning. More money will enter that particular selection which will reduce the odds. Large numbers of people backing a selection rather than laying will reduce the odds until more people are willing to lay the selection. Keeping the horse racing example for a moment, other things that can change the odds include, a change of form, or a change of conditions (‘the going’), a change of jockey, and tipster tips.
How to make selections for swing trading on Betfair?
This is the million dollar question. If everyone knew how to do this there would be a lot of Betfair traders out there. In reality, the successful Betfair swing traders tend to develop a unique strategy. Often available to just a few people. The more people that know about how they do it the less profitable it will become. Due to the volume of money entering markets a large number of people using the same techniques on the same selection will change the odds quickly.