A frequent discussion in the office is the relative importance of profit versus profit on turnover, so I thought I’d write a piece on this for the new website.
I, and many other Champion Bets analysts, will be writing betting articles on here over the coming weeks and months and hopefully they are both useful and informative.
When you gamble for yourself, the main focus is profit. The sole focus, for many, is profit. Everything else is white noise.
However, as I have seen since I have become a public analyst, there are many more variables that punters seem to be interested in than just pure profit.
The main focus over this side of the world seems to be profit on turnover (POT.) It took me a while (and I’m still not convinced) that this was as important as many seem to think. One of the most successful gamblers I know achieved his millions with a POT of around 1%. So anyone trying to tell me that someone needs to achieve at least xyz% POT to be successful is going to have a hard time.
However one of the things I have become more and more interested in as I have become more successful and new challenges and opportunities present themselves is time freedom. For me time freedom is the ultimate goal. All the money in the world is pointless if you don’t have any time to spend it and enjoy yourself. I don’t want to be spending all my hours and days for the rest of my life hunched over a screen tapping keys and staring at numbers. I want to be seeing and enjoying the world.
So bringing that theory back to gambling, the amount of time it takes me to earn, say, $100 has become more and more important. If I have to spend 12 hours earning that $100, it’s probably not worth my time. That isn’t to say that $100 wouldn’t be nice, it’s just that I could probably use that 12 hours more productively.
So that is a kind of Profit on Turnover. It’s just not money that I’m turning over, but time. So I completely agree with the argument that you can’t spend $10,000 to win $100. Not because of the money spent, but because of the time it would usually take to place bets with that money. However if you were to have a computer automated system that constantly churned out profit at 1% POT with limited or no human time management issues, nobody will convince me that that isn’t a positive outcome.
So in conclusion I agree with the concept of POT, but give me an extremely profitable person or system over a guy with fancy POT figures any day of the week.
Profit on Turnover is generally accepted as the measurement most punters use to analyse the relative success of a tipster or system.
Which of the following will grow your bank faster?
(a) 10% Profit on Turnover, or
(b) 30% Profit on Turnover
Most punters would very quickly answer (b), as they focus almost exclusively on the ‘P’ figure when looking at Profit on Turnover.
But the correct answer may well be (a), because you need to look closely at the turnover figure as well.
Consider the extra information regarding these two tipsters:
A only bets in his home state and has an average of five bets per day, seven days per week. He bets $50 per selection and his long-term average of 10% Profit on Turnover results in an average weekly profit of $175.
B takes a very selective approach and he identifies one best bet in each of Sydney, Melbourne and Brisbane each Wednesday and Saturday. He bets $50 per selection and his many years punting experience and selective approach helps him achieve an exceptional PoT of 30%, at an average weekly profit of $90.
So Tipster A makes $175 per week on average despite ‘only’ 10% Profit on Turnover.
Tipster B makes an average profit of $90 per week, basically half as much as Tipster A despite a PoT figure that appears three times as profitable.
As well as considering profit and turnover, a third key factor to consider is strike rate.
The lower the strike rate the greater chance there is of an extended losing run which can decimate your betting bank and also cause you to lose faith in your approach. It takes a lot of discipline to stick with a plan that has had 20 straight losers, yet such a losing streak is not uncommon following systems or tipsters that hit at less than 20%.
So when you are next measuring the success of a tipster or system make sure you take an in-depth look at the numbers.