How to be a Trader

	Eliciting a ‘Yes/No’ answer from Clyde proves difficult. He doesn’t want to hold my hand, and I don’t blame him

Receiving an unsolicited email titled ‘Mastering exchanges: we’ll teach you to understand the principles required to be a successful trader,’ I’m about to file it in my special folder marked ‘trashcan’ when I notice a short biog indicating the signatory, Mr Clyde Wolpe, is a consultant for Betfair with over 15 years in the sports betting industry. A couple of mouse-clicks later and www.exchangepro.co.uk turns out to be advertising a new bricks-and-mortar training course, primarily looking at betting exchanges.

The £275 fee initially raises an eyebrow, but considering it’s spread over six hours – equating to £40 an hour – I’m thinking it’s a small price to pay if the course does exactly what it says on the tin. Always eager to learn any new tricks on the exchanges, one phone call later and I’ve booked myself on to a course in seven days’ time.

Although a resident of these shores for the past two-and-a-half years, Clyde’s native South Africa is immediately apparent in his voice, as is his passion for doing everything in a considered fashion – a skill he no doubt learned from being South African chess champion in 1985. The former backgammon pro says, ‘In this industry, there’s a quick-fix culture and everyone’s interested in tipping services without actually applying their own knowledge to the procedure.’ Guilty as charged, m’lud – who hasn’t run with a tip or two even if you don’t understand the reasoning behind it?

I’m an ignorant loser

I do little more than dabble on the exchanges, mainly Betfair. specials markets, athletics, football, darts, ice hockey, basketball – you name it, I’ve lost on it. But today Clyde wants to change my whole perspective from ignorant loser – in the nicest sense – to conscientious winner.

Admittedly, the basement of a video rental shop in Hammersmith, London isn’t the height of glamour, but with its sound-proof walls and distraction free-decor, this seems as good a place as any for study. ‘I like to keep the classes small – no more than ten. Each person can have a computer to himself and I can give more personal attention,’ says Clyde. Today, though I have a one-on-one.

Clyde hands me the course syllabus. How to work out odds, understanding value, finding arbs, identifying market sways – it’s thorough, that’s for sure. It’s soon clear this isn’t untried theory either. Clyde made a full-time living from Betfair for two years from its conception and his success was part of the reason why they now employ him as a consultant. But it was while working at Betfair that Clyde realised his calling lay not in simply trading but rather educating other punters how to trade intelligently.

‘For years people in the industry have said, “What are you trying to educate punters for?” ’ he tells me, scratching his head. ‘For 20 years we’ve been doing very well thank you very much.”’ It’s this resistance which forced him to set up private tutorials.

A valuable lesson

Like many successful traders, Clyde knows that one of the most important aspects of trading is spotting ‘value’ – ie knowing when a team is a much bigger price than they should be and capitalising on it. But he believes the importance of ‘timing’ in conjunction with ‘value’ is often overlooked.

‘It’s all very well to buy the value and sit back’, he says, ‘but what do you do after that? The nature of the beast is that events change and value disappears as fast as it appears.’ He points to the UK Sports Personality of the Year. ‘Before the Second Ashes test, Flintoff was at around 26 or 30. He was great value. But because he was man of the match, public euphoria forced his price way down and it was pointless trying to get on. And as we know now, the bookies have already paid out on him.’

Frowning, I mention that’s all well and good, but how was I supposed to know Flintoff would play his socks off before he had even put them on? ‘Anticipation of key events is key,’ explains Clyde. ‘Ricky Hatton was at 5s right after his fight with Kostya Tszyu, but since fading from the public eye he’s drifted out to 44 (28 at the time of writing) to be the Sports Personality second-placed finisher.’

Sure, that’s a good price but aren’t Michael Vaughan or Paula Radcliffe more likely to nick it? Clyde retorts, ‘He doesn’t necessarily have to win for you to make money. You just have to offload before he starts drifting out again. He’s fighting on 26 November against Carlos Maussa. You must assess what sort of impact a win will have. Remember, anticipation is key.’

No quick fixes here

So I get on Hatton now and lay him off after his fight, right? Eliciting a ‘Yes/No’ answer from Clyde proves difficult. He doesn’t want to hold my hand, and I really don’t blame him. He’s completely right when he says we’re caught up in a ‘quick-fix’ culture, and while it may seem initially frustrating, I’m starting to appreciate his approach more and more.

As we monitor the Premiership matches and scour the cricket markets for the day, it’s obvious that his ‘90% of Betfair customers lose money’ statistic holds considerable weight. A goal is scored and the money piles on, a couple of wickets tumble and there’s panic on the virtual streets. ‘If you know that a team with a big score are going to declare, then losing a wicket can actually help them because they’re closer to their goal of actually declaring. Average punters overreact – but as long as you stand firm and let the market move, you’re going to make money. You’re not trying to pick a winner,’ he remarks.

Man of principles

And over the rest of the day, this is how it is. No easy tips, no secret systems, just pure, unadulterated principles. I find out how to convert percentages into odds and vice versa, and how working out the correct odds is absolutely crucial to making longterm profit. I grasp the importance of laying aside emotion during trading and learn how to spot when the market is itself ‘emotional’. Clyde demonstrates how to look for arbitrages (arbs), and I surprise even myself by finding a couple of these wondrous creatures.

By the end, I’m shot – though Clyde is still raring to go. My head may explode from all the info I’ve absorbed. I tell Clyde I’m scared I may forget it all tomorrow, but he just laughs. ‘Even after you’ve finished the course, if you need help I’m always available on the end of the phone or on email. In fact, keeping me up to speed with your progress is a practice I positively encourage from all my students.’ Leaving, that £275 seems far better value to me than it had six hours earlier – though, of course, I’ll wait for my exchange balance to pass the final judgement.

Interested? Then call 07913 100056 or email info@exchangepro.co.uk