You simply can’t learn how to win without knowing this! There are no shiny bells or huge ROIs here. Nonetheless, this is one of the most important things you’ll ever discover and will ultimately prove the difference between long-term success and failure.
What you’ll often find is that we hardly ever talk about the ‘boring’ stuff. Yet this is what we need to become profitable. Yes, we can discuss the more exciting aspects of horse racing betting. However, we need to focus on day-to-day things to make a long-term profit.
If we’re NOT taking care of the everyday things, we’re gambling, NOT investing, and we DON’T want to do that! We DO want to find ‘good’ bets with value that allow us to win long-term.
What this multi-part article covers is Profitable Losing. I’m going to look at the following, which I have divided into four parts:
- Why You Can’t Win Until You Lose (This may seem tautological, but it is a fact)
- Losing Streaks
- Downswing Duration
- Understanding ROI & Bankrolls
Each of these four categories is crucial. If you don’t implement all of the above, there is NO POSSIBLE WAY TO WIN LONG-TERM! Hopefully, that grabbed your attention.
Here are each of the chapters:
Now, let’s proceed with Chapter 1.
Chapter 1 – Why You Can’t Learn How To Win Until You Lose
‘Back’ bettors LOSE more than they WIN!
This is so important to understand. As a back bettor, someone who places basic ‘win’ bets, 99% of you will lose more bets than you win. Exceptions include if you predominantly bet odds-on or else you ‘dutch’ bet.
What do you think is a good strike rate for win bets?
There is quite a differential between what people believe constitutes a respectable strike rate, though most seem to believe it is in the 20-35% range. Those who believe 60-80% is a good strike rate must be focusing on horses at odds-on prices, dutching, or a similar model.
Most bettors believe that 30% is a good rate when wagering on the ‘back to win’ market. The reason why is because that’s roughly the percentage of favourites that win. Therefore, we automatically assume that’s good! It doesn’t come into our minds because it is the strike rate of favourites, but that’s pretty much why we think it.
Let’s look at a 30%-win rate. It means we’re losing 7 out of 10 bets. Let’s get our heads around that. Imagine we’re placing three bets a day, which is comfortable for most bettors. Losing 70% of our bets means we lose for two solid days out of every three. We’re going to lose every bet for two days out of three, on average. We could lose more or have good days, of course.
Now, we have to get our heads around that. It doesn’t mean we’ll make a loss; we can still make a profit. But psychologically, we must understand that we will lose that often if we back to win at what is generally considered a decent strike rate.
Let’s flip this the other way and imagine we’re lay bettors.
Lay bettors win more than they lose, but WHEN they lose, they lose most of the profit made.
I’m going to let that sink in for a second.
This is also the case for place bettors, generally speaking as well. So, it relates to lay to win and back to place punters.
It is the same concept. When you have a high strike rate, usually, the odds are lower. So those of you who talk about 60%, 80%, or 90% as acceptable strike rates should know that we win more often than we lose when we have those sorts of numbers. However, when we lose, we lose most of the profit previously made.
The journey is different. For back-to-win bettors, we spend most of our time on a decline (in bankroll). Then we get a winner, and BAM, it goes straight back up before starting that decline again.
Lay to win bettors do the opposite. They go up, get a loss, and BANG, straight back down. Then they start building up again. Lay bettors will spend most of their time in profit, but they have to deal with the fact that a single loss will wipe out 80-90% of that profit.
Back bettors have to deal with continual losses, but it will cover their losses and make a small profit when they get a win, then we start again.
This is the journey we have as long-term bettors. It doesn’t matter which side we sit on, back, or lay; the journey is filled with moments of frustration. That’s what we have got to stop from happening to us.
If we’re back bettors, most of the time, we’ll be losing. Psychologically, we have to realise that we’ll lose most of the time and occasionally win. Then the profits will slowly drift away as we go through the next losing streak until we hit the next winner. At this stage, we’ll make another little profit and get a little higher in our bankroll than the last time we made a profit. Then most of that profit will slowly drift away…
That’s the life of a back-to-win bettor!
For a lay-to-win bettor, it is the opposite. Most of the time, we’ll win and think, “this is awesome.” We’re doing so well; then we hit a loss. Because our wins are so small compared to our stake sizes, that loss will wipe out a massive chunk of profit. Then we fall down, and after a while, we’ll get back to where we started, but we’ll get a little bit higher, earn a little bit more profit after that loss.
Then we’ll start again, winning relatively continuously until we hit the next loss, and BANG, we’ll lose 80-90% of that profit again. Whether it is one loss or a few, it doesn’t matter; the principle remains the same. Hopefully, that loss will take us slightly higher than it was after the last loss.
That’s the life of a lay-to-win bettor!
We may be better at continually losing and getting one or two wins, or we may be better at accepting the fact that a single loss will wipe out most of our profit.
Only YOU will know which one you’ll be better at!
However, no matter HOW we bet:
We have to be psychologically prepared to lose as we’re going to be doing it a lot!
We don’t remember the wins, apart from the odd lucky one that came in at 59/1 or something. We don’t remember the wins at 3/1 or 4/1; they’re just part of that betting journey.
We remember the losses. The losses hit us hard. The losses are 100 times harder than the wins are good.
We have to accept that we’ll lose a lot, whether it is in terms of time, or a high loss rate, or because a single loss ensures we lose a lot of our profit. It HAS to NOT affect us if we aim to win in the long term.
I want to clarify that it isn’t all doom and gloom! I know it sounds like it, but it:
Doesn’t mean we won’t make a long-term profit!
You can make a long-term profit backing to win, laying to win, backing to place, laying to place. The issue is we want to make sure we’re prepared for these losses. Most horse racing bettors don’t make a long-term profit because they can’t cope psychologically with losing a lot.
We stop, and we change what we’re doing. You have to be consistent! You don’t buy stocks in a company, and when they drop a few points, you stop and move out, and every week you’re flipping and flopping. You don’t do that! People only do that in sports betting because the gambler’s mindset overtakes the investor’s mindset. We have to stop that.
Just because we lose 70% of our bets backing to win or 90% of our profits with a single loss when laying to win doesn’t mean we won’t make a long-term profit.
Until you can cope with losing, you can’t win
Losing is the cornerstone of profitable betting, and we have to learn to cope with it.
Chapter 2 – Losing Streaks
When it comes to losing streaks, you must know what you can cope with.
Can you cope with five losses in a row? Back-to-back?
Can you cope with ten losses in a row?
How about 20? What about 30 losses in a row?
Here’s a question: Can you cope with ten losses in a row when betting two or three times a day? You could lose five days in a row at two bets a day, from Monday to Friday, with no wins, only losses. At three bets a day, it is around three days of losses. Can you cope with this?
You have to know how many consecutive losses you can cope with before you go off-piste. In poker, it is called going ‘on tilt.’ This means getting so frustrated that you do things you shouldn’t be doing. For instance, you decide to bet on a horse solely because you’re so annoyed you lost on a previous one.
How many losses in a row before you start doing that stupid stuff? That number, when you are about to start doing dumb things, is the maximum number of back-to-back losses you can cope with! If you begin doing these things, you’ve already gone too far and need to pull it back!
If we can’t cope with losses, we’ll never get to the wins. We’ll pull out of the investment before the strategy’s dividends pay off. I see this happen every day. Bettors say they have ‘X’ amount of losses and want to quit, but it doesn’t mean they can’t profit.
The range of losses people can cope with tends to be between 5 and 40, although the latter is amazing.
We should think about it over the course of a year. If you have three bets a day, that’s roughly 1,000 bets a year. That’s the timeframe we should consider when looking at losing streaks because the more we bet, the more likely we are to hit a longer losing streak. Therefore, we have to look at a year’s worth of betting.
Let’s focus on the three bets a day level for approximately 1,000 bets a year. If you can only cope with five losses in a row, you need a strike rate of 75%. Those who can only cope with four in a row must have a win rate of 80%. If you can handle ten losses in a row, you still need a strike rate of 50% or higher!
Also, it could happen more than once. You could have ten consecutive losses, followed by two wins, followed by 9 or 10 losses in a row.
What about a 30%-win rate, which is what most people say is acceptable? You can expect up to 19 losses in a row at three bets a day during the year. Again, you could have 19 straight losses, two wins, and another 18 losses. If you can’t cope with that and go on-tilt and do stupid stuff like changing the strategy, you won’t make a profit. If you can’t get through the losing streak, you won’t get to the winning one.
We start changing strategy because we had 19 losses in a row, four wins, ten more losses, and say it isn’t working anymore. It probably is! There is nothing statistically to say it isn’t working; it is probably working fine. However, you’ve stopped and changed the investment before giving it a chance to work.
When we talk about horse racing betting as a long-term investment, we’re not talking about single bets. We’re looking at the process as a whole, analysing the strategy we’re using as an investment. We can’t make decisions that go outside the statistical norm.
Can You Adapt the Strategy on a Day It Doesn’t Work? Or the Staking Plan?
No! When you change something on a day, you’re doing so on a TINY sample of data.
Meanwhile, you’re building your strategy and approach on a large amount of data. It is an investment, so you can’t change it on a day it isn’t working. That would be like buying stocks in a company; there’s an argument with the CEO, and the share price falls… and we jump out instead of waiting for the argument to finish and the share price to rise. If we change at that time every time, all we’ll be doing is making a loss.
Do something new… loss.
Do something new… loss.
Do something new… loss.
We’re never going to get to the profit.
It’s a business!
Regarding losing streaks, it is weird to me that no one says this. Well, they do say it, just not very often! This is because talking about losing streaks isn’t good for marketing.
Losing streaks will happen a lot! They’ll happen more often than winning streaks and last longer. For instance, you’ll get six weeks of losing streaks followed by a one-week winning streak. This is what happens; this is normal. We have to be psychologically prepared for when it does happen.
Staking Plans Won’t Stop Losing Streaks! They Will Just Make It Worse When They Happen
This is a mathematical fact. A staking plan can’t stop a losing streak. The people who say it can are out of their minds! The theory is that we recover our losses with certain staking plans.
It doesn’t work, and here’s why!
You might get some short-term success but will ultimately experience long-term failure. When you use a staking plan to recover your losses, you bet more after every loss. It doesn’t matter if the staking plan is Retirement, Martingale, Labouchere. It can be any staking plan where the goal is to recover more of your money by staking more after a loss.
What happens here is that we bet more money on the losing bets than on the winning ones.
The result? A reduced ROI.
Eventually, you’ll hit a losing streak so long that your ROI will become negative. When that happens, your entire bankroll is gone. A staking plan may get you over a losing run in the short term. However, ultimately, you’ll hit a bad spell where your bankroll can’t cope because you’re betting more on the losers than the winners.
When we take the maths right to the bottom, that’s what is happening. When we try to recover losses, we wager more on losing bets.
If I was to come to you outside a staking plan and said, “Do you know what? This horse is going to lose, so why don’t you bet £100 on that horse? This horse is going to win, so why don’t you bet £25 on it?” You would think I was mental!!!
Yet this is what bettors do every day when they use a staking plan.
Here’s how to deal with losing streaks:
Make sure your strike rate is high enough to only give you losing streaks you can cope with
Therefore, if you can only cope with four losses in a row, you have to create a strategy to win 80% of your bets. It’s that’s simple! Then you can cope with the losing streaks.
This is why we need to know the losing streaks we can handle and the likely strike rate of a betting strategy.
If you can’t deal with more than ten straight losses, you must have a strategy with a 50%-win rate. You can also use a bet structure, such as 80/20, to give you that higher strike rate.
We have to expect losing streaks and plan for them. If we have built a strategy around the fact, it has a strike rate with losing streaks, we are comfortable with, we set ourselves up to win rather than lose.
Chapter 3 – Downswing Duration
Downswings are the next thing we have to fight. We must tackle all the bad stuff we’re likely to face before we start. We need to have the fortress built. We’re not going into battle with a penknife. We want to go into battle with the fortress, the moat, the drawbridge, and an army. We have to be prepared.
We’ve already looked at the kind of losing streaks we can cope with to get out on the other side with profit. Now we have to look at the downswings. These are the hardest ones of all; they’re like a trebuchet!
Downswing duration is how long it takes from a high point to get to another high point. Let’s say we made a profit of £1,000. We subsequently go down and up. We go down to £750, then £800, then £600, then £900 and so on.
A downswing duration marks how long it takes to get from the £1,000 highpoint to the next highpoint, say £1,001+! More importantly, what is the longest period possible between these two points?
Let’s say we expect a 30% strike rate, a losing streak of 20, and we bet on three horses a day. Immediately, we know we can go well over a week without any win, followed by a couple of wins and several more losses. The downswing at a 30%-win rate could last six months. Yes, it could be six months between your highest point and your next highest point.
This doesn’t mean your strategy isn’t working or that you won’t end the year in profit. Now, six months is a little extreme in this example. It is more likely that the downswing will last 10-16 weeks. However, you could get a six-month downswing and still end the year with a good ROI. Yet you must be able to cope with the downswing.
Downswings can last 1, 3, 6 months, and if you like high odds, even longer.
They can last a phenomenally long time compared to what most of us would expect. If you can’t cope, you’ll pull out halfway through the downswing before it has ever had the chance to reach its next highpoint.
You see these graphs of profit, and it looks nice and goes up. But look at the bottom for the number of bets. Often, these graphs on tipster sites go on for 2, 3, 5 years. When you look at the timeframes for some of these downswings, they go on for months!
Sometimes you see graphs promoted on sites, but when you check out the downswing, it goes on for eight months or longer. Most bettors can’t cope with that, which is normal, but it goes hand-in-hand with losing streaks.
If you can’t cope with losing streaks or downswings and go on-tilt in either case, the strategy will never be profitable. It could be profitable for someone else, but they’re not you. They might be happy to sit in a downswing for a year.
Be honest with yourself; it is okay if you can’t cope with it. You don’t have to accept it when people say that 30% is a good strike rate. All that matters is whether you’re comfortable with the downswings. For instance, at a 30%-win rate, you can expect to have regular downswings of three months.
Downswings of six months are not unheard of. Imagine getting up every single day and placing bets during this period.
Here’s why most bettors lose… They stop before a downswing is finished and never get to the upswing.
It isn’t because they can’t find winners; it is because they can’t cope with a bad spell. They never even get to the start of the upswing, let alone the top!
If you’re backing to win, the downswings are always longer than the upswings.
If you’re laying to win, the upswings will always last longer, but a bad spell will wipe out 80-90% of your profits.
Chapter 4 – Understanding ROI & Bankrolls
The following seems like common sense, but I believe that up to 80% of bettors aren’t prepared to do this if they’re honest.
You have to be prepared to lose ALL your bankroll!
The whole thing! 100%!
You can have more money in your betting account than you’re basing your stakes on, and that is fine. You might like your account to feel safe, so you have £1,000 in your account even when the bankroll is only £500. However, please make sure your stakes are worked out on money you’re 100% prepared to lose.
Let’s say you have £1,000 in your account and work out your stakes based on that amount but are only prepared to lose £250; you’re overstaking by 300%. If you’re prepared to lose £500 in this scenario, you’re still overstaking by 100%. Doing this will ensure you eventually lose your bankroll as it won’t cope with losing streaks and bankrolls.
What’s a Big Enough Bankroll?
As a rough guide, your bankroll should have enough to deal with ten times your longest expected losing streak. Five times is very risky, whereas 15 is rather safe.
Therefore, with three bets a day and a 30% strike rate, you require a bankroll of at least 200 units. It doesn’t matter if you see a tipster who says you only need 50 units at a 30%-win rate. Mathematically, you’re almost guaranteed to lose your entire bankroll if you only have 50 units in this instance.
Many people see 100 units as the standard, but you are taking a big risk if you do so with a win rate of 30%.
Another option is to create a bankroll big enough to cope with 3-5 times your biggest downswing, which is usually similar to 10 times the expected losing streak.
Personally, I look at both and take the larger one because I like to play it safe.
Understanding how much you need in your bankroll is so important if you want to keep it and eventually grow it.
If you can make a 5% ROI, that is incredible since you can’t do that anywhere else. In horse racing betting, this means 5% on turnover. This means you bet £100 and get £105 back on average. That’s pretty good if you’re betting three times a day but remember, you won’t win like that due to the peaks and trough.
But imagine, across five years, I’m going to give £100 three times a day and get £105 back each time on average. That’s what a 5% ROI means, and it is amazing. Yes, you can get higher than that, but 5% should be your base level. Achieve this, and you are outperforming basically any other investment that doesn’t require immense risk.
This could result in a 20% growth in your bankroll each month, which is remarkable, and again, you won’t do that in any other situation where there isn’t massive risk.
Unfortunately, expectations for horse racing betting are insane and are primarily based on advertisements. For instance, this guy did a £1 accumulator and walked away with £100,000. Or else they come from tipsters who say you could have made £15,000 profit from £50 bets last month.
All of the above is short-term; it is chance, luck, and ultimately, gambling. Sure, you can go away and do that, but here, we’re talking about long-term profit from investments and making sensible decisions. This means knowing that growing your bankroll by 20% a month is incredible but also that you can do it via a 5% return on turnover.
By the way, growing a bankroll by 20% monthly means you are doubling it twice a year! Even when interest rates were 5%, it would take 20 years to double your money in the bank (less time if compound interest was used).
Many bettors don’t seem to realise that we’re talking about a per bet basis when we say 5% ROI. This is VERY different from how banks do it with a 5% APR, an annual return. We’re talking about average per bet, which is a mind-blowing level of profit if we’re realistic.
Breaking it Down
Let’s set some realistic expectations of what is achievable. Forget about these tipsters! Yes, they may win £15,000 from £50 one month but lose £20,000 the following month.
We are investing, which means we want long-term ROI figures. Here are some numbers that will make sense and are possible to achieve:
£1,000 bankroll, three bets a day, 100 units required, £10 a bet, betting £900 a month.
Look at how much you bet in a month! Almost your entire bankroll monthly from just three bets a day!
With an ROI of 5%, you would make an average of £45 a month. You might think that it is practically nothing and is not worth it.
Let’s think about a 5% APR which you can’t get anyway. Most banks offer 0.1% or something now! Anyway, it would take almost 12 months to make that £45 from putting £1,000 in the bank with a 5% APR.
With our 5% on turnover, we make £590, a 59% return on capital over the year. That is mind-blowing! To make a long-term profit, we have to move away from the gambler’s mindset that we can have £1,000 and walk away with £15,000 tomorrow. We can’t do that!
However, we can invest £1,000 and walk away with almost £600 after a year without further investment. You’re not getting that anywhere else without huge risk. If we rent out a property, we’ll do well to get 8% a year. Therefore, investing £50,000 in a property means we’ll make around £4,000 a year.
Also, your bets might make an ROI of over 5%. However, you must acknowledge that 5% is an excellent return. If you want more profit, you need to invest more money! If you’re not comfortable with that, no problem. However, do not increase your stakes with the same bankroll, or else you’re risking all of it.
Another option is to re-invest your profit into your bankroll in what is called compounding. Messing around with staking plans or reducing your units to get bigger stakes will result in your bankroll’s guaranteed loss because you’re gambling at that stage.
One proviso with compounding is to withdraw at least 30% of all new profits. This is because there is an inherent risk, even if you do everything right. Do this until you withdraw at least the same amount of money you invested, although it is better to do it permanently. It doesn’t matter if you made 50p or £2,000 this month; take it out.
Psychologically, this is crucial. Otherwise, you fall into the common trap of not taking out the profits and increasing the stakes instead. Then you’ll get concerned because the inevitable losing streak arrives. You haven’t taken out yet, and pull out of the strategy because it is no longer working, and you’re back to square one.
You have to take it out. You put in time, effort, and investment; you have to take something out. Psychologically it is a must. The amount of money doesn’t matter; it is all about the process. We’re implementing investment processes, which means taking that 30% out weekly, monthly, or bi-monthly. It doesn’t matter. Just make sure you take that 30% whenever you reach a profit high.
As for the notion that the £50,000 in property isn’t at risk. It is, in fact, especially if the property bubble bursts. I know people who have houses worth less than what they bought them for in the greater Central London area.
Yes, the risk on property is less than on gambling, but the return is also less. If you can get a good horse racing strategy built around you, built around achievable and realistic expectations, with bankrolls and strike rates that work for you, it can be one of the best long-term investments out there. However, we need to have the mindset of investors.
Isn’t This Why It Is Better to Back as Many Contenders as We Can, Rather Than a Few Each Day?
Philippe is talking about volume betting. Most of us are not comfortable with long losing streaks. When we say volume betting, we mean at least ten bets a day. However, it can be 20, 30, 40, 50, 60 even up to 100. With this form of betting, we’re prepared to get less than 5% because of the volume.
Say we have a £2,000 bankroll, with 200 units and £10 per unit. Let’s say we’re making 3% on bets with 50 bets a day. We’re betting 25% of the bankroll every single day! £500 of bets a day with 3% equals £15 profit on average for the day. That’s around £500 a month, which is massive growth.
Volume betting is more systematic because you need more selections. As a result, this will appeal to people who are into portfolio-type betting. You will need to have anywhere from 5 to 50 different approaches that can be automatically found. You’re accepting that the advantage you have on these selections is significantly lower and may collapse at any point.
However, this is okay because you spend time creating new ones and putting them through test phases, and when finished, you put them into the portfolio. Your actual job is managing that portfolio where you remove non-performers and add in new strategies.
If you’re doing 4 or 5 bets a day, I suggest a contender process and FMFR without any shadow of a doubt.
Race Advisor Pro uses contender processes that I call Foundational Strategies to limit our losses, shortlist horses, and ideally make small profits or a small loss around breakeven. We can find contenders very fast, and we only need to spend 5- or 6-minutes checking to see if the horses are likely to perform in today’s race. We use the strengths of systematic processes and remove their weaknesses from them, and use something different.
Once again, if you want to make a long-term profit from horse racing, you must treat it as an investment, and that should be your strategy. The strategy you’re using has to be viewed in the long term. We can’t chop and change strategies because they don’t work. Back to poker, you have to think of horse racing as grinding it out on the poker table. You go through the downswings and upswings and eventually end up with a predictable percentage return.
Whatever bankroll you have should be able to cope with the losers. One strategy we had lost around 30 or 40 units in April and early May, but it only affected about 18-20% of the bankroll. It doesn’t matter if I was betting £1, £100, or £1,000 because the bankroll was properly structured. The only thing that changes is the amount we need. I’m not even vaguely worried about a drawdown of 18%. I’ll rarely experience downturns of over 50% because of the bankroll, but even if I do, I am okay because I am bankrolled properly.
A mistake people make is to think that they are not getting anywhere near 50%, so it is okay to double their bankroll. However, psychologically, that will make you lose.
Having several different strategies that overlap to help cover long losing streaks is a great idea. A portfolio consists of several strategies that work together to help level out losing streaks. So, you might have a back to place, a lay to place, a back to win, and a lay to win. Some will have lots of winners then lose a lot of profit; others will have not many winners but can suddenly have a big profit.
Of course, at some point, they will all hit their losing streaks at the same time. We have to expect it and be prepared for it.
How Do We Assess if a Strategy is Any Good?
It’s really simple. First, it depends on whether it is systematic or not. If it is systematic, we must use out-of-sample data. We also must assess it over a long enough period. One hundred winners is the bare minimum to make an assessment. If you make any changes, you have to wait for another 100 winners to assess it and make any real statistical assessment, and even that is pretty low. It can be historic or live.
Then we use a combination of strike rate, expected losing streaks, ROI, downswings, chi-square, and A/E or impact value. We need something with a positive A/E, which means we have an expected advantage. We’re looking for something with an ROI that is high enough. We’re looking for something with a strike rate related to the losing streak and the downswings that we can cope with.
Then if it looks like it is making a profit, we break it down into years. Has it made a profit in each of the years assessed? If it has, that’s great. Now, let’s break it down into quarters. Has it made a profit for most of the quarters? That gives us an understanding of the strategy and how it works.
Suppose a strategy has made a profit for years but is in a loss in 2020 and 2021; not so much confidence there. We probably need to go back to the drawing board and make some adjustments.
Can You Up Your Staking Plan When in the Midst of a Winning Streak?
You can, and there are ways to do this, but generally, I wouldn’t recommend it. Not unless you’re comfortable in what you’re doing. The best way is to stake based on odds; there is no better way. Flat staking is riskier but will often show a higher bankroll growth initially. But the best way is to stake based on odds. We are risking an amount of money in relation to the odds of our selection.
It makes sense because a horse that is odds on means we’re going to bet a lot more money on it. It makes sense because a horse that is odds on is far more likely to win than a horse that’s 50/1. The ultimate staking plan is based on odds.
“Think about it logically; all businesses must have a plan. Why would you risk your hard-earned cash without a plan?”
“Reward yourself; it’s so important.”
“Profitable betting is about managing losses.”
These are all great points.
I have identified 100+ microsystems that have high strike rates (40%+, sometimes 50%+ but do not have high volumes of bets. How would you go about identifying those that are worth pursuing as a system?
It depends on the volume of bets. Are we talking about one bet a month? Some microsystems have only 15 bets a year. That’s a different method of managing a portfolio and can be done but does require a slightly different approach.
If you have lots of systems, do you have bankrolls for each one or lump them all in together?
You can do it either way. My personal preference is for management’s sake; I have one bankroll. But you can manage it in two ways. Either you manage a single bankroll across your whole portfolio. This means your whole portfolio has a single strike rate, and that strike rate in the long term is how you base your bankroll. Alternatively, you have a single bankroll, and within it, you have your other ones.
The easiest way is to have a single bankroll and stake based on odds. If you do this, it becomes irrelevant because each strategy will have its strike rate, its own losing streaks, its own theoretical bankroll. So that strategy might only stake X percent based on odds. So, it is always changing dynamically for each one based on the odds, and we’re always maximising each stake for each strategy in our bankroll based on the odds of the selections and the expected losing streak for the approach.
The most important message difference between gambling and investment is mindset. If you want to make a long-term profit from horse racing, you have to have an investment mindset.