Fixed Odds Trading Strategy

Fixed Odds Trading is a method of betting (or trading) on the financial markets, using a specialist bookmaker.

If you are interested in trading on the markets then you will have heard of some of the different ways of losing your money, such as spread betting. Well, if you want to risk losing more than your stake, then by all means go with spread betting, and good luck to you.

Let me give you a list of what I believe are the benefits of using Fixed Odds.

• You cannot ever lose more than your original stake.
• You are in control of the odds that you want to trade with.
• This means that you also control the amount of risk in any trade.
• Depending on the market, you can trade from as little as 10mins, up to 6 months.
• You can trade on the major European and US Indices plus the Forex market. This means that there is always an opportunity to make money in the markets.
• Betting in the UK is tax-free.
• There are various betting mechanisms offering alternative ways of trading on any market. so if one way doesn’t suit the market conditions, then another one may well do so.
• You can even sell your trade back to the bookmaker, if the market starts to move against you. Of course you won’t get back all of your stake (they have to make a living), but the earlier in a trade cycle that you sell, then the more you will recover.
• In fact, you can sell your trade at any time when it is in profit. No need to wait until the trade expires. An example might be: a trade on the ftse to earn 12% profit in 9 days. The ftse moves to make your chosen trade very safe and it moves into profit within 24 hours. It is quite possible to be offered a return of 6% in that time. So why wait for another 8 days for 12%? Just cash in the trade, take your profit and reinvest in another trade.

I’ve had the benefit of doing this a few times with some of my trades and it does give you a buzz when it happens, although most of the time the trades will run their full distance.

Note: A trade that I started on the 23rd April 07 for a 19% return after 9 days, was showing a profit of 12% after 24hrs. So I sold the trade and realised the profit.

There are traders who make a very good living from Fixed Odds. For others it is a second income or maybe just a way of enjoying working the markets while making a profit.

A lot depends on how much you want to invest in your own ‘trading bank’. I would suggest that a suitable starting point is £1000 to £1500.

There are trading memberships available where you will be offered trades to place at anything from 3% return up to 40%+. These memberships range from very low risk (3%) to very high risk (40%+). A typical monthly membership fee can be from £45 to £99.

Now you can see why I suggest that your starting bank needs to be £1000+. You have to pay your monthly fees AND make a profit on trading. Otherwise, why bother?

A trade normally runs for 9-11 days, so you can get almost 3 trades in a month and compound your profits. But, you should not expose any more than 20% of your trading bank on any one trade.

So if you placed 20% of a £1500 bank on a trade (£300) for a 10% return, then you would have £330 after 9-11 days. If you did that twice a week, you can see that you would easily work within the limits of your bank and start to build your bank.

But what about losses? Yes, you will get some. You are after all, betting on the markets.

This is where your risk aversion come in. It is not difficult to work out how many winning trades you will need to make up one loss. Obviously, you will need a lot more wins at a 3% return than at a 40% return. But potentially, you will lose more often at 40% than at 3%.

Only you can decide what risk level you are comfortable with. Also, remember never to trade with money that you cannot afford to lose. It is most unlikely that you would lose all of your bank, unless you had a series of losses at say 40%.

Personally, I am comfortable with trading at the 8-12% return level. The risks are still low and I get a reasonable (tax free) return over a 9-11 day trading period.

If you want to learn more about Fixed Odds Financial Trading, then I can highly recommend the ‘Rich Guide to Financial Fixed Odds Trading’ by Matt Shaw.

You can get the Guide, including a free 30 day trading membership of Profit Vortex. In the 30 days you will receive 4 trades in the range of 8-12%, so that you can ‘try before you buy’.

Also the monthly membership fee can be started much lower than other membership sites. You can build up to whatever level you wish to trade at.

Membership sites are ideal for the busy individual who wants to trade but does not have the time to do the proper research into the markets.

The trades in Profit Vortex are supplied by Matt Shaw, who is known as Mr. Fixed Odds Trader. He has an excellent reputation within the Fixed Odds trading community and makes a full time living from trading.