Today we’re going to cover some pretty essential information. It may not be the most exciting information but it’s vital because it will save you from:
- Blowing huge banks and losing a tonne of money
- Doing something which you think is beneficial but is actually a waste of time
- Being in the 95% of traders who make these costly mistakes
So, let’s get cracking on the two topics:
- Bankrolling Your Trading
- The Use of Practice Mode in Betfair Trading Software
Bankrolling Your Trading
It’s pretty obvious that if you’re going to trade then you’re going to need to fund your Betfair account with some money. But how much do you start with?
For your first deposit, I suggest you deposit no more than £100. This maximum of £100 must be money that you’re comfortable with the notion that you’re 99% likely to lose this first trading bank.
Why only £100? Well, because you’re going to make a tonne of mistakes and you’re going to lose a lot in your first few weeks. I’m not saying you’re going to suck badly at trading forever, but in the first few weeks EVERYONE sucks badly at trading.
You should only risk a maximum of £100 (that you’re willing to lose, remember) because the pain will be a lot less than losing £500 or even a couple of thousand.
It has been proven that new traders are pretty much 99% certain to blow their first few trading banks. So please, don’t go too hard when you’re just starting out.
The Use of Practice Mode in Betfair Trading Software
I’m going to give you one of my top tips here, and it may sound completely counter-intuitive. But trust me, it is sound advice and one that many professional traders also recommend.
Top Tip: Do not use practice mode for weeks on end whilst you’re learning the art of trading.
The main reason for this is down to mentality. It’s all too easy to trade in practice mode. As it’s not real money there’s little pressure on you.
This means you’re more carefree and you’re more likely to suffer less heartache when you lose. Suffering less heartache means you’re less likely to learn from the mistakes you made when you did lose.
So, what do I propose instead? Limit your staking.
The minimum bet amount on Betfair Exchange is £2. I recommend you stick with anywhere between £2-£5 stakes when you’re learning. The use of real money, even though it’s small stakes, will still provide a mental challenge to you of whereby you’re concerned about losing part of your trading bank.
From my own experience, I started off with a £500 trading bank. Within 2 weeks it was gone. I went back and practiced (in practice mode…) and came back a month later. This time armed with a £2,000 trading bank.
I won’t recreate the scene for you, but the next month was pretty much a car crash that decimated the £2,000 trading bank. I was angry, frustrated and completely deflated. (Ps, yes, I know it was stupid.)
The Only Times You Should Be Using Practice Mode
Of course, I don’t completely advocate never using practice mode. After all, it’s included with Betfair Trading Software for a reason. Therefore, there are two situations when it is completely beneficial to use Practice Mode:
- When you’re literally just starting out and need to get used to how a trading software works. You’ll need to learn the functions it offers and where to find them
- When practicing a new technique, testing a new strategy or trialling some automated trading
For these two situations, it’s completely understandable and highly recommended you use Practice Mode.