Betfair new commission rates

I was getting all excited about today's post. Had reached a little milestone and was quietly pleased about it. I was going to be saving money and I felt good about all things Betfair. Unfortunately I no longer have that good news. And where I was going to save money I'm now going to be worse off. It seems 24 hours is a long time in the world of Betfair. :-(

My good news was that after nearly 13 months of trading yesterday I'd finally collected enough Betfair points to reach a 10% reduction on commission. Not a huge increase in reduction from the 5% I was on but worth having all the same. However, from next week, due to the new Betfair commission rates, I will be on a 4% reduction.

So I've lost a 6% reduction rate. You can play with stats in an unlimited amount of ways to make this sound worse than that. Or show how badly this will effect me - and you! Doesn't matter how you play with them though, even with my lack of maths skills, you can't make a case for me being better off. I'm not pleased!

Do the sums yourself. Apply them to your own rates. Looking back at recent results this would have cost me as much as over £6 extra on just a single market. Multiply that by several hundred events a year and it doesn't take a genius to work out how much extra using Betfair will be costing me going forward. It's some price rise. And I'm small fry. Out and out punters who get involved in far more markets than me will be hit even harder.

Ok fine. Betfair will, fingers crossed, still be profitable for me. But my % of commission paid compared to profit made, which is already high, will be higher. Of course, it doesn't take a genius to work out why Betfair might have done this. And there's a whole host of "maybe" secondary ideas that could help explain it too.

But fuck me. Talk about a kick in the teeth. The day after I finally reached the hallowed 10% reduction I'm unceremoniously dumped back down to 4%! Lower than the 5% I was on after this week's reduction is taken into account. I had one market settled with the 10% reduction. The new charges are implemented on the 29th - before the 2nd test ends - so the chances are it will be the only ever market I have settled at a 10% reduction. :-(

The irony is all this comes in a week when another exchange has approached me and offered 0% commission for an introductory period. It's not rocket science what I'm going to do is it. But at the same time there's no point in cutting my nose off to spite my face. Sure I can use other exchanges and do. But I need the liquidity Betfair offers. Betfair knows this, and uses its virtual monopoly to cash in. That's business. I know it. You know it. And most people will simply accept it. I expect some people will leave. But that loss of business won't cost Betfair as much as the increased revenues from the commission price hike. Pissed off? Yes. Much I can do about it? Not really. Still use Betfair? Yes. Prey for decent competiton? You can bet on it! :-)

So all that kind of left a sour taste in the mouth. Especially as it was wrapped up in a "We wish to thank you for your valued custom" context!! Yeah. Thanks for your custom. In fact we're so grateful here's a big price hike. Still, I guess at least this time no attempt was made to pretend we'll all be better off.

So today wasn't a particularly good day. And it got worse as I was looking at the 2nd Test match market between England and West Indies. Bit of a mixed box this one. I got a fair bit on the draw at 3.0 with bookmakers when their prices first went up the other night. Am tempted to take the free bet on this, or get really low and dirty ;-) and just arb it for a nice few hundred profit either way!

On Betfair I've screwed the market up somewhat though. There wasn't the liquidity when I got on with the bookmakers to get on at 3.0+ on Betfair. Didn't really matter as my main play was going to be to lay England. But I missed the boat big style by trying to be too greedy. Tried to lay around the 1.8 mark the first night the market went up. Went unmatched. Tried for 1.87 last night. Could have taken 1.88 there and then but figured I'd be matched overnight. I wasn't. And the price was 1.95 when I got up. So I tried for that. Missed it. Missed 1.99 too and by the time it got to 2.1 I figured that's it. Leave it.

To compound it I backed the draw far too low (considering my interpretation of the weather at the time and the habit Headingley has to move the game on quickly on days 4 and 5) thinking it was a lay but if people were going to continue to push the price in I was going to ride it. Within 10 minutes the price had drifted 8 ticks and I was £80 down. Not my day! Still, there's five days of match action with which to get involved so hopefully I can turn a profit. And my position with the bookmakers is a bonus.

Right, one more thing as I know this is already long. Regular readers will know I'm a big fan of Punt. Always a good read. Anyway, I thought this article was excellent. As is the link from the first comment. It'll take a good 20-25 minutes to read it all but it's well worth setting the time aside. Top stuff.