LM portfolio as at 16/09/2022:
| Code | Sector | Date Bought | Cost | Value | Gain/Loss |
|---|---|---|---|---|---|
| LM045 | Gas, Water & Multiutilities | 06/12/2021 | £1280 | £1190 | (6.83%) |
The LM Fund is nowhere near the point where any shares will be added to the portfolio. One position remains and this should probably be closed off but I'm giving it a bit of length with which to hang itself. It's slightly under the 200 day SMA but still some way from a 20% stop loss.
There aren't any commodities to buy at present and cryptocurrencies have probably had their day - I really should've played more with them in the early days, if only to take advantage of them being unsophisticated markets.
Previously I have mentioned that in the absence of any trading opportunities I have been concentrating on other things and this is mostly two different betting strategies.
The first strategy is based on comparing the odds of a horse at a bookmaker to the odds at Betfair and then placing each way bets on the horse if the bookmaker's odds offer value.
It means placing dozens of bets per day across several different bookmakers and then allowing the law of large numbers to work its magic and the profit to slowly inch up as the weeks go by. The results so far have been great.
May and June showed a reasonable profit and then July was a great month. August was terrible, although the losses were less than the gains from July. So far September has been the best month due to one particularly brilliant day.
So it's fair to say that this system is well in profit.
Of course, there are issues.
Funnily enough, bookmakers don't like to lose money to punters and so they will quickly limit the amount you are allowed to bet. Cue a bookmaker like Bet365 only allowing tiny stakes like 25p each way (50p total). It's very frustrating knowing you have a great strategy but you can't ramp it up as your profits increase as the bookmakers refuse to take decent wagers from skilled customers.
Other bookmakers are even more ruthless and will close your account if you dare to win. 32Red is one which started to refuse bets after a while and bigger bookies like Victor Chandler and Betfred simply closed my account long ago. Seems if you aren't a pathetically addicted gambler then they don't want your business, which is morally dubious.
Running this system sounds complicated but it really isn't. I subscribe to a service which provides web-based software that automatically identifies the bets. All you have to do is load up the website and place a bet whenever a new selection is shown on screen. My schedule is to check the site once an hour and it takes around 5 minutes a time to get through all the selections, if there are any.
The process looks like this:
* New bet shows on the member's website
* I place the bet on the relevant bookmaker's website
* I click a button on the member's website to confirm that the bet has been placed and add it to the betting log
* I click another buttom to delete that bet from the list so it doesn't show up again and therefore isn't duplicated
Usually I will do this once an hour between around 10am and 3pm on a weekday. The website updates overnight to confirm whether the horse won, placed or lost and the next day I will download the betting log to a spreadsheet and log into each bookmaker to update how much each individual bet won or lost.
Having done this for several months it's an easy process and because it doesn't take too long, the system is definitely worthwhile despite the fact that the bookmakers typically don't allow me to place large bets.
The most important aspect of any betting system is that it has a profitable edge. Whilst the first system definitely has this, the second system can have a lot of ups and downs with long, long losing periods. It takes a great deal of faith to run this system - you have to trust the maths. And this is more difficult because it's a black box system and the creator and seller of the system releases few details of how it works.
In fact, all he suggested was to use small stakes (£2 is the minimum on Betfair) and do an initial test of 1,000 bets before making a decision on whether it is profitable or not.
I see the second betting system much like the investment strategy involved in the LISA Millionaire experiment in that it will require a great deal of patience. There will be long losing periods where dozens, if not hundreds of bets in a row will lose but then some winners will be large and bring the betting bank into profit again. In the LM experiment there will be lots of investments where there is no profit, or a loss, and those investments that do make profit could take months or years to come to fruition which does require confidence that continuing will pay off in the end.
As it stands the 2nd system is currently in profit to the tune of 130.87% following almost 1,500 bets. Only 84 of those bets were winners which goes someway to show that the winners are large enough to cancel out lots of small losers.
I'll continue with system 1 for as long as possible. How long that is will depend on how long I can keep my accounts open with the 6 bookmakers I am currently using.
System 2 does not have that kind of limitation as it uses Betfair. The issue here will be whether it continues to be profitable.
Luckily the profits so far mean I can go on a long losing run and lose 50% of the current bank but I would still be in profit. This suggests that system 2 could continue to be profitable. And as the bank increases I will increase the stakes used. With any luck this will be a long term winning strategy that I can use to help fill the £4k LISA subscription each year.
Please look out for updates on these betting systems in a few months, perhaps around Christmas.