So Dan before we get started, why don’t you tell us a little bit about yourself and your background?
My background, I studied accounting and finance at university, so I’ve always been quite numbers orientated.
During the last year of my degree, around 20 years ago now, I began learning the concept of ‘advantage playing’. Essentially, this is where the player uses mathematics and expected edges to take advantage of specific scenarios.
I got very much into sports trading, and now I supply analytics to sports teams. There’s a recurring, numbers-orientated theme among all of this. I’m also a tennis columnist for and offer my take on various sporting events using my own data modelling.
Q. What are your speciality sports?
I provide a stats driven service to help tennis traders and trade the sport myself too. Generally swing trading opposing pre-identified vulnerable front-runners in matches.
I also work with cricket analytics. I work with teams to improve their recruitment and strategy processes.
Q. How and when did you discover Football Index?
I discovered Football Index through an old school friend who was involved early on with the product – subsequently then I dipped my toe in but am really waiting for the full implementation of order books before I think my potential strategies could be adopted fully. To be really honest, when I found the product I couldn’t believe there weren’t the equivalent of order books already, and the lack of them was a big negative in my view.
Q. So what does the evolution of Football Index to include order books mean to you?
The evolution towards the trading exchange model should be very much geared up to the serious investor. My biggest problem was finding ‘theoretical value’ but finding it hard to realise this – being able to set my own prices would be a big improvement.
Q. As a seasoned trader order book trader, what advice can you share with traders who have yet to experience this setup?
FI is a unique market so its difficult to say what will happen in advance. However, I would imagine the value for many would logically be on illiquid markets and ‘distressed assets’.
Q. Do you think the move to a fully fledged exhange will attract more in the way of HNWI currently trading other markets?
I definitely think that an exchange model is likely to attract High Net Worth Individuals (HNWI) yes – the current model makes it far too difficult to get out of positions both relatively quickly and for a fair price.
Q. If someone came to you and said they wanted to be a professional sports trader, what are the 3 bits of advice you would offer them?
invent a time machine so you can take advantage of all the value from more inefficient markets in previous years! But seriously…
1) absorb as much data on anything relevant as possible.
2) remember that the price reflects the implied probability of an event occurring, but doesn’t imply the likelihood of swings to get to that outcome.
3) long-term processes are more important than short-term gains.
Q. The worlds largest sports exchange has over 4 million customers, do you think FI can become a big a product as that?
Tough ask, but yes. I think the key would be to get regulated in as many other countries as possible and pool the liquidity. This has been a bit of an industry wide issue for the expansion of bookmakers and trading exchanges in recent years.
Q. How do you go about researching or looking for opportunities of where to put your money next?
Every day I collate data on every tennis match that then gets calculated into a model, which gives projected service hold percentages for each player and a model value price. It’s quite a time consuming process though and can take several hours (particularly for 1st round matches in a grand slam and for the weeks with many events in multiple continents), but anyone interested can purchase the data via my spreadsheet subscriptions.
Q. You have been on IndexGain for a number of months, what feature have you found to be the most beneficial for your trading?
I think IndexGain is a fantastic tool for Football Index traders and far eclipses anything available that I’ve seen as the equivalent for exchanges. I’m a big one for using and refining historical data to drive future decision making, so having all that at the click of a button is huge.
At the moment, I’ve been working on building a model focusing on expected match day scoring based on historical data from IndexGain and also stuff like opposition quality – so there’s quite a crossover from my tennis work, where I look at opposition quality a lot.
Q. What do you feel is the best life skill you have learned that has helped you become the trader you are today?
Definitely discipline and money management – you can be the best trader in theory but without discipline and money management skills you are never going to maximise returns. Record keeping is also critical as well – goes back to keeping and absorbing as much data as you can on as many things as you can.
Q. Trading carries a mix of technique, discipline and phycology, do you think it is possible to become a successful trader without all three?
Technique/discipline/psychology are all important. Maybe this sort of comes under both discipline and psychology but removing emotion is also very critical. If you can do that, and have strong strategies and good financial control then that’s a big part of the puzzle solved.
Q. How good do you think you have been from removing emotion from your own personal trading?
Pretty good! Having my advocated data driven approach is very useful for that, because you can then have a semi-flexible script as opposed to doing things by ‘feel’ on a whim. It’s important to be very process orientated as opposed to ‘moment’ orientated.
Q. Last one. Given the changes to order books, do you as a professional trader see yourself becoming much more active over the coming months?
If the order books changes are positive for me, and I have no reason to doubt that they won’t be, then I’ll definitely be looking for opportunities to get further involved with FI.
In all honesty, order books/the Exchange model is something I’ve been waiting for before I got more involved with the platform, so I’m very excited to see it being implemented.
Follow Dan on Twitter @tennisratings