Tennis Trading Tips: How to Turn a Losing Trade into a Winner
In this article, we will explain how you can turn a losing trade into a winning one.
Like all trades, this is not a guaranteed ‘get out of jail’ tactic but if you remain confident that the player you were backing will make a comeback then this neat trick can help you minimise your losses and even make a profit from a losing trade.
To explain how this works, let’s use an example of a match between Ashleigh Barty vs Garbine Muguruza.
Pre Match Research
Despite Barty being ranked No1 in the world at the time of this match, the marketplace priced her as the underdog. The starting odds for each player were:
Barty - 2.25
Muguruza - 1.62
Also, when we looked at previous h2h matches between these two players, Barty had won 4 to Muguruza’s 1. So we thought; Barty should be the favourite here.
Placing a Trade
If we placed a Back trade on Barty for £50 @ 2.25, what profit would we make if she won the 1st set AND what would our liability be if she didn’t?
So we entered the starting odds into the netProfit Odds Predictor tool and discovered that:
If she won the 1st set we would win £34.59
If she lost the 1st set we would lose £35.80
Then, flushed with confidence, we placed a Back trade on Barty for £50 @ 2.25
To be clear, normally we would never place a trade BEFORE a match, but in this instance we felt that there was overwhelming ‘value’ in Barty and we may lose out altogether if she just went ahead and won the set.
Then, frustratingly, she lost her serve in the third game! Aarrgghh
Her odds immediately jumped to 4.5 and we were looking at a loss of £25.00
We felt hard done by. This wasn’t fair!! Come on Barty what are you doing?
Then we calmed down…and thought, hang on she is ranked No1 in the world and has beaten Muguruza 4 times and lost only once. OK, with our confidence dented we may now feel that she’s unlikely to win the match but surely she’ll break back soon?
Placing a Recovery Trade
So, instead of hedging out for a loss of £25.00 we placed a new Back trade for £50 @ her new odds of 4.5
This did two things:
- It raised our break even level on the trade from 2.25 to about 3.9
- It also meant that if Barty broke back and levelled the match in the 1st set, her odds would return to 2.25 and we could then hedge out for a profit of £48.44
And thankfully, Barty did break back in the 6th game. So her odds returned to the starting position of 2.25 and we hedged out for a profit.
How does this work?
We are simply placing a second trade at a better price so profits start at higher odds and, when you offset these against the losses of your first trade the break even level is higher.
However, you MUST be realistic about your player’s chances of breaking back.
What would have happened if she didn’t break back?
We would have hedged out for a loss at the first sign of trouble. For example, if her odds drifted to 5.0 we would hedge out for a loss of £32.50
This compares to our original hedged loss of £25.00. So our potential loss has increased which is why you need to be confident in staying loyal to your player.
Hope that helps!