Friday, 6 July 2012

Welcome to my weekly surgery...

I was left a comment yesterday by someone seeking advice. Goodness! Are there folk out there who think I actually know what I'm doing?

Here's the question...

Hi Rowan i know you have been doing this for a while could i ask your advice on something.

I am struggling with my staking for example i have two services that i play 80 pound per point. The problem is one service has a staking plan of half a point per selection and the other service has a selection on average of about 1.5 per point. So i am having 40 per point on the first service selections and 120 pound on the second services selections this does not seem correct or does it balance itself out in the long term.

All I can suggest is the way I cover staking. This isn't for everyone, and ultimately I think the individual needs to do what they feel most comfortable with when it comes to any aspect of gambling. I believe that you can adhere to all the rules set out by portfolio theory but still make a mess of things if you don't feel comfortable with what you're doing. So much of this game is psychological.

Anyway, re. the two services. My approach is to look at what the overall staking can reasonably be expected to be over a decent period of time. I look at a year.

Let me try and use an axample to illustrate how I go about working things out re. staking.

Let's take Northern Monkey and On The Nose. In 2011, Northern Monkey staked a total of 400pts (399.63 to be precise), whilst On The Nose staked 530 points. I'm trying to work out how much the £/pt value should be for 2012.

Now, the theory I adhere to is that in a portfolio, over a certain period of time, you want to be staking more or less the same amount on each service. You have to assume here that these services are both proven and you have confidence in each (otherwise why follow them at all?). Why do we stake the same on each service? Well, Northern Monkey has a long term roi of 19%, On The Nose 17%. In other words if you stake, say for ease of figures, £10k on each throughout 2012, then on past performance levels you should make £1,900 profit with NMP and £1,700 with OTN. Very acceptable, I'm sure you'll agree. Additionally, if you're staking roughly the same on each service and one of them has a shocker, you are not running the risk of exacerbating your losses by staking a lot more on this one than you are on the more successful service. So theoretically, if a service has a 'mare, the losses will be countered by the profits made by the other.

So, back to our example.

Say we want to stake £10k on both NMP and OTN in 2012. For NMP, we divide £10k by the 400 points staked in 2011 and that gives us a £/pt value of £25 (£10,000/400 = £25). The same calculation for OTN gives us a £/pt value of £18.86. Let's round up the OTN figure to £20 (I'm not going to be putting £9.43 on a half point win OTN tip - the bookies will think I'm arbing!).

And there we have it. That's how I calculate my £/pt values for each of my services on an annual basis.

Of course, this is all based on theory and on past staking levels. This can cause problems moving forwards. What if, for example, a tipster suddenly changes strategy slightly and gives significantly more or fewer bets out? I think the thing to realise is that you're never going to have it spot on, but if you're following established services, predicting future staking levels shouldn't be that tricky.

To take it further, just work back from the starting point of how much you want to make from a service in a year. In other words, for Service C which has a long term roi of 15%, I want to make £2k clear profit after subs fees next year. How much do I need to stake (ie. turn over) to enable me to make this based on historical performance, and hence what is my £/pt value to be? Naturally, once you have worked this out, you know the requisite size of bank for that service too.

I hope that helps, and answers the question. If not, just let me know and I'll have another crack at it. Of course, all this theory goes out the window if the tipsters involved forget how to tip a winner or two!

Thursday's Betting

Well, well, well. How nice it is to report on both the horses and football making a profit on the same day!

Racing plaudits to On The Nose. Two win bets from two - (Brockwell - Haydock - 4/1 and John Biscuit - Epsom - 11/2). Well played that man!

Winning Racing Tips had one bet that finished in the frame for a small loss, and no luck for Northern Monkey (0/2) or The Market Examiner (0/1).

Success overnight for Summer of Football (1/1) and Service X (1/1).

That's more like it.

Listen chaps, have a great weekend. Despite the weather, eh? Rain, rain and more rain. Still, the precipitation is nowhere near that of the floods of tears that have rolled down my cheeks since RVP made his little statement. But I'm over it now, and hold no bitterness towards him. Honest.



  1. Hi i left the comment about staking thank you for the reply it was very helpful. Can i ask one final question. I know you say you stake both services on the nose and northern monkey almost the same in terms of pounds per point. These two services however stake very different does it bothor you that sometimes you may have three times more on a selection from northern money than a selection from on the nose because of the different staking advice they give.

    This is an issue that gives me cause for concern i may stake the same for both services but because one service stakes different than another i may always end up having more on a selection of northern monkey than on the nose for example.

    Sorry if i am making it appear confusing thank you for your advice.

  2. Hi,

    No, it doesn't worry me, is the short answer. My NMP stake per point is actually about 140% that for On The Nose, but no, the general point is I would only worry if after say a year, I was staking disproportionately more on Northern Monkey than I was with On The Nose (or any other racing service).