First Things First

RISK: First Things First!

There's going to be a few posts to follow around the topic of risk in following this Dutching strategy.

The internet is bursting full of systems strategies tipsters statistics and self styled experts - almost all are failures or at least their customers are! The proof is quite straightforward that the high Nineties of betfair customers at any one time have losing accounts and then of the remaining few, semi-pros or pros, they may be in the money but a similar  high percentage of these fall by the way side over time. Some are in truth just riding their luck, those with a genuine long term edge often fall pray to risk events which they are not equipped for.

So Dutching to level stakes with an edge ranging between 4 -6% checked over 10 years and a strike rate of 90%+ What could possibly go wrong?

The Standard LLR (Longest losing run) formulae gives a figure of just over 3 consecutive losers in this scenario. But Draw down with cumulative negative variance can produce extreme  periods of risk.

The sample for the following Risk of Ruin figures covers 1700 races over a full year.

There is no occurrence of 3 consecutive loses, but in this shot is a losing sequence totaling £2,600 to the Dutch staking cap of £485.

When this occurs there are two facts

• If you don' believe you have the edge you will crumble.
• If you haven't got the bankroll numbers right you will get wiped out. 

This Is What Happens when It Goes Wrong