A few days ago, Mark left a comment saying that he was considering starting betting on a portfolio basis, and asked if I could provide an "idiot's" guide to starting out. It is difficult to write a fully comprehensive post on this as there are so many things to take into consideration, but I have put together the fundamentals I think. Obviously if Mark, or anyone else for that matter, would like to dig into certain areas a little more, then don't hesitate to ask.
I must also add that I can only write things from my own perspective. I am not saying that the way I describe how to do things is the only way. It is simply a description of how I do things and what I have learnt from my experiences. I'm sure others have their own way of running a portfolio, and I'm not going to knock those other methods at all.
If you're reading this and are a bit too experienced for what is to follow, jump straight down to the 'Today's Action' bit, which is usually all you get from me at the weekend anyway!
So, without further ado...
Right, I'll start with something that you have no doubt heard a thousand times before in a thousand different places, but it is important. Get your betting bank, and stick it somewhere away from your day to day current or savings accounts. The reasons are obvious. Just do it.
In terms of what you put aside, yes of course it is dependant on how much you want or can afford to risk, but you also need to work out how much you will need for each service that you follow. The standard way to do this is to look at a service's results history, work out the biggest drawdown, and then double it. That is how large your bank needs to be.
Example: Service A you want to stake at £10/point. From looking at the service's results, you see that the worst drawdown is 47 points. You need a bank of 100 points (94 if you really want to be pedantic; personally I would just round it up) for this service, ie. £1,000. Don't confuse 'drawdown' with losing run. The worst losing run may be say, 25 points, but if the next bet won back a point, before embarking on another losing run of 19 points, then your drawdown is 43 points. What you're trying to do is set yourself up to be able to handle a worst case scenario, and the drawdown figure will give you some indication of what this might be. The worst losing run won't.
Naturally, you do this for each service you wish to follow.
Now there is 'leverage' that you can apply to your combined banks which will make your money go that bit further. This is a more advanced concept though and really requires a post on it's own.
Choosing your services
I believe that this is an area where it is so easy to fall down at the beginning. I know I chose some completely inappropriate tipsters to follow and continued to do so for months after I started.
I'm not talking about results here. I assume you're only going to follow services with a proven track record of success! I'm thinking more about choosing services that fit your personality better. If you don't think that you can hack long losing runs for example, don't follow a service that tips horses at an average price of 10/1. The danger here is that you set out all positively, the service has an inevitable losing run, you lose faith and either reduce stakes or perhaps stop following altogether. That of course is when the service returns to finding winners that you miss out on. After a week or two you start backing again by which time you have missed out on a load of returns and sod's law will dictate that the tips start losing again. I have been there. It is not a nice place to be.
The services you follow must also fit into your lifestyle. If you don't want to be putting bets on early on a Saturday morning, don't follow a service that issues bets early on a Saturday morning.
This takes a little introspection and you must be honest with yourself. Don't pretend to be something you're not. What I would say though, is that as you become more experienced, your aptitude to deal with losing runs improves and you may then find that you are better able to handle the services that play at the longer end of the odds range. At the start though, you want to be making life as easy for yourself as possible.
One last thing, and again a trap I have not so much fallen into in the past as hurled myself in nose first...a lot of services spring up, produce fantastic returns, and then over time fade away. I am (now) a strong believer in trying to follow experienced tipsters. If the 'Young Gun' really does have an edge, it will last. Don't be afraid of missing the boat and get sucked into a service that looks great at the moment, but may not last the pace.
Personally, I prefer betting on football to racing. Generally speaking, you are open to fewer long losing runs and I often find that securing the best prices is more straightforward. However, many has been the time when my football bets have been heading south, but my racing bets have been strong, and vice versa. Diversity is key. There are all sort of principles of correlation that better writers than me have explained in a way more succinct and easy to understand than I could ever do, but believe me, these principles are important.
I think it was Tony Blair who once said, "Diversity, diversity, diversity!", and in those days, he did little wrong, you know.
Another very simple point here. Open as many accounts as you can, and for football purposes, don't forget the Asians.
The more you can spread your bets around, the longer your accounts will be viable. Simples.
How you keep records of your bets is very much the choice of the individual. If spreadsheets are your thing, fill yer boots. Obviously these will allow in depth analysis to the extent you'll be able to work out over time that if you dropped all bets on horses ridden by Barry Geraghty on a Tuesday when it is raining, you'll be much better off. Personally, I don't really go in for this. There is so much analysis done by others (eg. SBC, people on forums, etc.) that I can pick up all the most important trends/facts. I'm not knocking those that do this - it just isn't for me, that's all. But, what is very important is that you keep a full record of your bets and service performance. The bottom line is everything, and you need to know what it is.
Can you use pen and paper? Yep, if that's what works for you.
And there we have it. There is definitely room to explore some of the above points further of course, and if anyone wants to ask about any other aspect of running a portfolio, all they need do is ask. Mark...is this idiot-proof enough?
A shocking day on the horses today with not one solitary winner from 15 bets! The only service to perform with any credit was Winning Racing Tips which got three placed from three selections (Uncle Dermot - Lingfield - 7/2, Andreo Bambaleo - Newcastle - 8/1, and Enriching - Lingfield - 9/1). Good tipping, better than reflected in the returns, I would suggest.
Elsewhere was just a nightmare, with the only other placed selection being one of On The Nose's two (Basford Bob - Uttoxeter - 8/1). Blanks for 4PA, PJA NH, Northern Monkey Punter and Chasemaster.
4PA: Staked 2pts, -2pts.
On The Nose: Staked 2.5pts, -1.2pts.
PJA NH: Staked 3.5pts, -3.5pts.
Northern Monkey: Staked 1pt, -1pt.
Chasemaster: Staked 0.5pts, -0.5pts.
Winning Racing Tips: Staked 2.1pts, +0.5pts.
Total financial loss on the racing of £214.
In credit on the football today was Skeeve, whose fabulous month continues. 3/3 for his main service although the 'Late BSS' service only found one from three to bring the profits down (wakey, wakey, old boy). Still a very solid overall performance though. Football Investor got seven from fifteen which normally you might expect to bring a points profit in double figures. This week however, many selections happened to be the home teams and the average odds was therefore a little shorter than usual. Nice returns nonetheless.
Just in debit was Strike Zone which picked three winners from six. Football Elite got one from three and Shaolin Betting only had the one selection which lost. Unusual on a Saturday but nothing today from The Sportsman or from The Football Analyst (I follow System 8-22).
Football Investor: Staked 15pts, +4.6pts.
Strike Zone: Staked 6pts, -0.417pts.
Skeeve: Staked 22pts, +5.664pts.
Football Elite: Staked 3pts, -0.745pts.
Shaolin Betting: Staked 1pt, -1pt.
Financial profit on the football of £65.27.
Saturday 19th March: Staked £1,821, -£148.73.
Week to date: Staked £4,187, +£13.07.
Month to date: Staked £11,154, +£586.29, roi 5.25%.
And finally, what news of Graeme Dand - The Football Analyst - who was tantalisingly close to the jackpot in the 'Racing Post's' Cheltenham Festival competition? Well, the lad done good, as they say. Just not quite good enough! (but darned good all the same). He finished second, just five points off the winner. Gutted for him to be honest but he wins a decent sum for his efforts. If you're reading this Graeme, hard luck, mate - now get back to work with those footie systems and whatever it is you've won, dare you to stick it all on the next System 8-22 selection. You know it makes sense.