The variance: a good reason to use automation
The variance is the ability of the events to occur with a frequency different from what we expect from their mathematical probability. In every strategy, there may be extended periods where events consistently work against us. During these phases, emotions may skew our perception of the strategy's effectiveness and make it difficult to remain committed to it. Similarly, in situations where events persistently favor us, emotions can impede us from manually collecting considerable sums. Using automation, especially when it is protected by a capital limit, it will be easier to
give the strategy sufficient time to demonstrate its consistency.
Betfair 'Market Base Rate' and 'Discount Rate'
Every time you get a win on a market you pay a percentage of this win to Betfair. This percentage, called "Market Base Rate", may vary from market to market and can depend also by the country of the player. On UK races for European players it is 5%. More bets your strategy produce, more wins you get and more fees you pay. There is no compensation with losing markets.
You can reduce the fee percentage using the
Discount Rate provided by Betfair to the most active players. You can arrive to pay a minimum of 2% on winnings.
A strategy that goes even with a fee of 5%, is a winning strategy with a fee of 2%.
The R.O.I. (Return On Investment)
It is the percentage ratio between the net earnings and the total sum of risked money. Basically it is a metric of the quality of a strategy: if it is positive you are earning money, if it is negative you are losing money.
If you have a knowledge of the sport you are going to bet on, you can use it to increase the ROI: for example, you can exclude races or runners, that accordingly with your experience, could not fit well with the strategy you are using. If your knowledge of the sport is valuable, the positive effects will certainly be forthcoming in the mid-long period.
Market liquidity
The liquidity of a market is given by the amount of money that has been exchanged on it, and (above all) by the amount of money that will be exchanged after the bet placement. Each winning strategy has a maximum volume of money that can be supported by the liquidity of the markets. Beyond this limit, the market will trigger mechanisms that will exploit this excess of demand/supply in its favor.
A strategy can work very well playing with 20€ and very bad playing with 2000€. Do not expect to find easily the "holy grail", but cumulate several winning strategies with a low return. Ipposnif can run numerous strategies at the same time and it will be the key to achieve your goals.