What is Pre Match Trading?
Pre match trading is when we look to enter and exit a trade before the start of a football match.
This is also a popular strategy when trading horses and is known as pre race trading in the horse racing markets.
In truth you can trade any sport pre event if there is enough liquidity to get your money in and out of the market .
If there is very little money in a market then it can becomes difficult to get your money in and out of the market at the prices you want.
Pre Match trading is my favourite strategy for tackling the sports trading markets and it can be a very effective way of making money.
Perhaps the best way to explain a pre match trade is with an example.
Pre Match Trading Example
Lets take a look at the above example when Manchester United played Reading in the FA cup.
There was a simple reason for this trade. Sometimes good pre match trades can have very simple reasoning.
The main reason for this trade being that Man United have a very strong squad and even a second string side was likely to have great quality players involved.
Looking at historical odds the price of 1.26 is a similar price to when Man United had faced lower tier Premier League sides such as Burnley and Hull.
Reading are a Championship side at the time of writing and given the above factors among others it was predicted that it was more likely for Manchester United to shorten in odds then drift.
Stakes of £2000 were used for this trade. It is important to note that this was not the total amount of money at risk as we are trading out before kickoff.
Pre match Trading Example 2
Let’s take a look at another pre match trade.
This time it is in the sport of NFL, trading using information that key players would be missing from a team.
In the above example we have a game between the Cleveland Browns and the Denver Bronco’s.
I made this trade using the sports betting exchange Smarkets. Currently I have a 0% commission deal due to being a member of Oddsmonkey.
So when possible I use Smarkets exchange to place my trades.
On the right side of this image you will see the amount of money matched on my trade. In this trade I backed the Cleveland Browns at an average price of 2.03 for £2906. The next day I was able to lay the Cleveland Browns at 1.79.
To break this down a little bit more.
In the above example you can see that I placed back bets totaling £2906.67 at odds of 2.03
If this was a traditional bet this would mean I would be staking £2906.67 to win £2993.87
2906.67 X 1.03 = 2993.87
So for every £1 placed.
A return of £1.03 would be made if the Cleveland Browns win the game.
However as mentioned earlier betting exchanges allow you the option to basically sell your odds (lay betting). Lay betting is when you bet against a team to win. The next day I closed my position on the game by placing a lay bet.
My only reasoning for this trade was that new information had come to light regarding the Denver Broncos line up. News had come out suggesting that key players would be missing from the upcoming match against Cleveland.
When opening the trade my plan was to allow the market to react to the news.
Then exit the next day for a profit when the news had spread around the sporting world. What happened was that people started to back Cleveland and odds on Denver had to rise. This in turn meant that the odds on Cleveland would have to drop.
Pre Match Trading Outcomes
In this example I ended up laying £3807 at odds of 1.79
This meant that for every £0.79 invested I would win £1 should they lose.
£3807.85 X 0.79 = £3008
This gave me the following outcomes:
Cleveland Browns win = £2906 risk to win £2993
Cleveland Browns lose = £3008 risk to win £3807
This left me with the following outcomes:
Cleveland win £2993 – £3008 = -£15
Cleveland loss £3807 – £2906 = £901
Rather then leave the majority of my profit on one outcome. I hedged my profit across both outcomes so that I would make a decent profit no matter who won the game.
Hedging means backing both outcomes of an event in order to reduce your overall risk. This is what you can see in the example above. A profit of £457 should Cleveland win or a profit of £448 should Denver win.
Here is a video explaining the trade.
Why do odds move prematch?
Lets now take a look at the reason’s odds move.
How can you use information prior to a game to make a good pre match trade?
Odds move before a game starts for a variety of reasons.
New information may enter the market such as
- Player injuries
- The manager may get sacked
- Coach may comment that he is resting players
- Weather Conditions
- New Signings
Money also moves the markets.
When a large betting syndicate sees value in certain odds they will bet large amounts of money which will shorten the odds on the selection they see as value.
The last performance of a side can also effect the odds for a future game.
If for example Liverpool play on a Wednesday night in the Champions League away at Fenerbache and the game goes into extra time. You would see an affect on the odds for their upcoming game against Everton on the Sunday.
This is because the market would perceive that Liverpool players would be extra tired. They may have to rest players. As a result the market would see them as having a lower probability of winning the game on Sunday so their odds would most likely drift.
I hope you have enjoyed this article and perhaps learnt something from it.
Pre Match trading is an excellent strategy to use in the sports betting markets.