This page is a work in progress and I will be putting together answers to the most commonly asked questions from comments and emails I receive. Thank you all for your kind comments, it really does help me stay positive for this trial period.
Why Firedave?
.JPG)
I inherited this nickname primarily at university but have a feeling it was a similar one at sixth form too. I enjoy juggling and when I realised fire could be juggled I was hooked. I have juggled at nightclubs, firework displays and just for fun. When I was called firedave it really just stuck and have used it as my online name in other ventures too.
What is trading?
What is a drifter?
A drifter is a term given to a price where it continues on an outward trend. For example, if the price was at evens (2) then caught a drift, the price would get larger (>2).
What are your targets?
My initial targets are to trade for 3 months (February - April). The first couple of months will be getting used to smaller staking plans and mentally preparing for the new routine. Over these couple of months the targets will be to make a small profit overall but more importantly not to lose the bank. Capital preservation has to be paramount, especially so when starting as I feel that psychology plays a large part of trading. A good start will be needed to help motivate and weather the tougher days.
In the 3rd month, the racing will have started to pick up. Cheltenham will be behind us, so I will have had to trade a bigger event and experienced trading on poor markets and very liquid markets. Overall the experience should be pretty indicative of what to expect over the full year although I won't get the chance within this trial to use full size stakes. In April I will have higher targets than the previous months but for me to continue I will just need the month to be profitable.
If the trial is successful I will post additional targets to keep my mind focussed but achievable.
Can you make money doing this? Is this profitable in the long run?
This is the purpose of the trial. I am doing this to prove to myself that this can be sustainable for long periods of time and cover the costs of living. I feel the trial is long enough to get a good feel for what trading full time will be like but at the same time short enough that I can cover my current expenditure. Although, as always, I would like the trial to go very well to help with the bills - I can afford to do this experiment. My blog is for people to share my journey, and see in total honesty as to whether trading the sports markets is something that can be done.
Why horse racing?
Horse racing is chosen due to its regularity, frequency and liquidity for trading. In these cases it is ideal as they are often every 10 minutes, for 3 hours and have enough liquidity not to be too volatile. To make enough money to pay a wage, you would in theory, only need to make £5 a race. Other sports can be traded though, tennis is good because there are only 2 players and one of them will win. The problem with tennis is that they are long matches and they have to be traded in-play. Due to the scoring system of tennis though, you can often lay or back a player at the start of the match and at some point during the match you will be able to get out for a profit. Football is another frequently traded sport, I will hopefully take a look at trading these but so far I have spent all my time looking at horse racing. Football has the option to back the over/under 2.5 goals market which will probably be the area I look at.
What is P&L?
The P&L is the profit and loss. This is normally collected daily but can be produced over any time period. Throughout the day it is unlikely that the trader will make a profit on every event traded. The profit and loss is a good reflection on performance for that day.
What is Strike Rate?
The strike rate is the percentage of wins to losses. This is a little confusing, as you will hear the term strike rate in relation to how well you performed on the one race. I.e I did 30 trades on the one race; of which 15 were scratched (0), 10 were 1 tick positive and 5 were 1 tick negative. This would give me a 17% strike rate for the race. In reality, this is extremely difficult to record, and therefore to calculate after the event. So the strike rate tends to be only on whether you managed a profit or a loss on the race as a percentage of the day.
What is a tick?
A tick is the smallest unit of measurement. It is the distance between each price e.g. 3 - 3.05 is 1 tick.
