Football is a sport I like, but sitting comfortably on my couch. What happens when the referee blows the whistle at half-time? Advertisers specialising in sports and especially sports betting take advantage of this to attract our attention.
A few years ago, out of curiosity, I opened an account in a sports betting site with only about ten euros. I never managed to make any money and yet, it was not for lack of looking for a method.
Then one day, in a forum, I stumbled upon similar words to stock trading: money management, buying and selling, trader psychology, trading software…
Comparisons between the stock market and sports betting?
Trading is an approach that consists of anticipating the future rise or fall in the price of a financial product. And betting on the outcome of a sports match is in fact nothing more than speculating on the outcome of this match.
A trader buys and sells financial assets through an online broker. In sports betting, the trader buys and sells bets on his betting exchange site. A trade consists of a purchase (back) and a sale (lay) of the same bet at two different odds. You can either buy and then sell, or the other way around. The difference between the buy and sell odds will be the profit or loss.
What sport should I trade on?
As in the stock market, when your capital is several thousand euros, it is important to choose an asset that has volume and in sports you should trade on a popular sport and on important matches.
The index on which I focus all my attention is the cac40 index, but maybe some of you prefer to invest on the euro/dollar or on a commodity like Gold. In sports betting trading, it is highly recommended to bet on a sport that you love and know well.
How much capital do you need to have?
For beginner investors who have a very long term goal, I recommend that they open a real account without going through a demo account. The capital must be at least 5000€.
In sports betting, I also advise you to open a real account in order to be directly confronted with stress management and with a very small starting sum. A sum that you are ready to lose.
Important note: I am not in favour of very short term trading on the stock market as in sports betting, as it requires too much time, energy and stress. On the other hand, if you are interested in it, you must have a real knowledge of the sport you want to trade, have a strategy and improve it as often as possible, have a trading plan and a flawless money management.
Making a trade on the stock market or following a tennis match: it’s not fighting with a market, understanding its variations and following its evolution.