There is a very experienced member of our forum with 7+ years of very successful action. He started with arbitrage but switched to Value Betting these last years. Everything was going pretty well, but a losing streak occurred these last 2.5 months and as a result he found him self with a loss of 244$k.
The amount is big even for the big guys. This is the first time that I hear about such an immense loss from one of our members.
Today we discussed on Skype about this and we came up with some results. At the end of our discussion I asked him to allow me post his story here so all members get educated from other people's mistakes.
How is he operating?
He is using
BetBurger as an indicator comparing Pinnacle with others, and when he sees a big arb 8% and above he takes the bet in the other leg and leaves Pinnacle side uncovered. From a Mathematic point of view this is very much correct to do. He was based on the assumption that Pinnacle lines are correct, and if we cover Pinnacle's margin, then we have value. But here is another hint:
Most of the leagues he is active in are lower leagues. He mentioned as examples Czech U19, Czech U21, Vietnam, Romania 3 and English lower leagues. He is blessed and condemned at the same time to have access to high street odds with a limit of 1000$ per game no matter what the game is. Limits would come but not that fast like betting in bet365 on line. He is blessed because by arbing he is making small treasures, but at the same time condemned because these odds and limits took him down in Value Betting. To anticipate questions, I do not reveal operating procedures of our members and I will not share the secret of having these odds and limits.
So if he is OK from a Mathematic point of view, how did he lose money?
I immediately realised that he put his feet in value traps one after another. Some times well informed bookmakers are giving extremely high odds on an event that they have credible information not available for the wider audience. You see it as value but it is not. It is a trap. A value trap.
This is not happening only in the soft side, but this could happen on the sharp side also. That is why many sharp bookmakers are having profits bigger than their margins.
Unfortunately for our member, these value traps occur more often in lower leagues compared to premiers.
He failed to realised the reason of his long losing streaks and continued operating based in his correct (by that time) Mathematic approach. Also, he failed to implement a good staking plan to reduce his risks from a long losing streak like this one. As a result he lost these 244$k.
Yesterday night he tilted.
Tilting is a point that we should never get to. It is a point where we capitulate to the market. The nadir a Value Bettor could have. At the state of Tilt, our mind is not working properly.
So during the discussion with our member we had to come up with a strategy in order to get him back for good.
After tilting and an immense loss like this, it is difficult to realise if you are sober or not. My first advise is to stop all action for a while, close the computer and make a trip somewhere to detox.
During this time you learn how to take the losses and live with them. We know that his arbing action is producing on average 600$ daily. So I initially suggested to continue Value Betting in premiers and arb the lower leagues. After a 2nd thought I suggested that he quits Value Betting completely, until he makes up these 244k strictly from arbing. It will take him almost 400 days to cover the loss, that is 1 year and 2 months, but after that he will be able to return revamped and self confident again. This is the safer way to go.