How to control deposit drawdowns?

Published: 04-04-22
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    In the world of betting, it is impossible to achieve a situation where absolutely every player’s bet will be a winner. The main task of the player is to ensure that the number of wins exceeds the losses so that in the long run one can make a stable profit. However, there is no doubt that in the short term a person may face a series of defeats, due to which he will lose a certain part of his money. This series of losses is called a drawdown. The term characterizes a certain decrease in the deposit, which is calculated as a percentage. It is important to note one detail here: the drawdown is not a loss, but a certain point of change in the deposit, it can shift not only down, but also up.

    All this is due to the fact that the balance of the player can not change steadily increasing graphics, most often it changes undulatively. For example, a successful period of a player still led to the fact that the total bankroll of a person decreased by 12% or 30%.  We will try to consider in more detail what the player should do in such a situation.

    The main reasons for drawdowns

    the-main-reasons-for-drawdowns

    First of all, it is necessary to understand what exactly leads to the formation of drawdowns.  Understanding such causes, you can minimize the chance of their occurrence. Most often, drawdowns occur due to the following factors:

    • A rapid increase in the number of bets. The more betting a player makes, the faster the probability of a serious change in the deposit changes. 
    • Significant coefficients. The higher the coefficients of betting, the more likely it is that the balance will change significantly.
    • Passability of forecasts.  This indicator displays the probability that the bet will be successfully completed.  Therefore, if it is low, then there is a high probability of drawdown.
    •  Lack of a systematic approach. In this case, the player begins to randomly manage the available funds, which in practice almost always leads to decrease in the balance.
    •  Long series of defeats.

    It is obvious that drawdowns are negative as it reduces the total amount of the deposit. Due to drawdowns, even winning bets are not profitable as all funds won are used strictly to restore the original pot. Therefore, to obtain the first profit, a larger increase is required than the total loss.

    Immediately note, that after a series of failures players do not need to try to immediately correct the situation. With a high probability they will only aggravate it. First, players need to restore their own mental state. The defeats have a negative impact on players, which makes the person more impulsive, and decisions become rash. In such a situation, it is difficult to make an adequate decision that will contribute to profit. It must be remembered that in betting it is very important to keep a cold mind and exclude emotions. Only in this case, players  can make a profit. Remember that even momentary defeats should not make players fall into despair, because in the long run they can easily fix the situation.

    What you need to manage drawdowns?

    One of the main problems that is formed when drawdowns appear is the uncertainty of the player. He begins to feel an unhealthy fear of losing, which may prevent a person from making adequate decisions. In such a situation, it is recommended to take a break from betting, rest and gain strength in order to subsequently restore lost positions. At once we note that the player should not change the size of the bet. That is, on the wave of defeats, the decision to increase the bet in order to “exactly recoup at once” will be erroneous, and will most likely lead to an even worse situation. The size of the bet should always be stable, the exception can be made only in situations where the person is as confident as possible in the success of the forecast. It is also not recommended to cut rates sharply, as it would be too difficult to recover lost positions in such a situation.

    Therefore, it is recommended to continue using a similar financial strategy. If players want to change something, then first they need to take a break from the game, and then assess the situation with a fresh look.

    The optimal bet size is 2-5% of the current deposit size. Once again, we emphasize that it is from the current, and not the existing one. The point is that after a long losing streak, betting based on a percentage of the original amount can lead to a complete loss of funds.

    The situation is similar with coefficients. Players should not choose only bets with low coefficients , since it will be very difficult to win back this way, because the winnings will be minimal, and the patency of the bet will slightly increase.

    However, choosing too high coefficients is also not worth it. Avoid too risky events so as not to reduce chances of winning.  A good solution would be to bet on live-events. The coefficients on them are always higher, while players can watch the game event live to increase their chance of profit.

    Note that it is not worth placing a bet immediately after analyzing the situation. In general, players should never rush the situation in order to have time to weigh all the “pros” and “cons”, and make the most profitable decision.  For example, before the start of a game event, players came to one conclusion.

    Sometimes it is very important to watch the beginning of the event to make sure that the logical chains used in the reasoning were really correct. Then if you are convinced that you are right, you will be able to bet.

    If on the contrary, you see that everything is progressing in an unpredictable scenario, then it is better to refuse such a bet to save your money.

    Another tip: do not use progressive betting strategies like Martingale to win back lost funds.  Using such strategies leads to even sharper balance fluctuations, which means you increase the chance of losing your own funds. In addition, such a strategy in a difficult period of time has a bad effect on the psyche, which means that the chance of making a balanced and profitable decision is significantly reduced. A bettor who has experienced a drawdown and is already under pressure, feels fear.  Because of this, it is very difficult for him to increase the amount of bets.

    Drawdowns, caused by a series of defeats

    drawdowns,-caused-by-a-series-of-defeats

    How should the player behave if the drawdown is due to a large series of defeats? How to stop this unsuccessful series?

    The first thing a player should do in such a situation is to stop playing and rest. It is very important to take a break from betting, take up your favorite hobby or go for a walk. A good solution for restoring the psyche is communication with loved ones. Need to remember that constant stress and excessive nervous tension have a negative impact on human health, leading to chronic fatigue. As a result, the quality of forecasts drops significantly. Secondly, it is very important to analyze your own mistakes. Try to understand in more detail the reasons for each defeat. Perhaps you make serious miscalculations that prevent you from making a profit. It is also possible that you are sometimes unlucky, and in the long run, the strategy you have chosen will bring significant benefits.

    Bad days or series of bets can cause a player to lose confidence in himself and his own strategies. However, players need to remember that the strategy can actually be successful, it just needs a longer time period to achieve success.

    Take a break and re-evaluate the strategy carefully to identify potential mistakes. It is important to understand that in the event of a drawdown, the main task of the player is to ensure that his approach brings him success and profit on a long-term strategy.

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    Marcis Licis marcislicis

    Marcis has joined the Casinobaltics team to educate our visitors and prospective gamblers about online casinos. A real casino gaming expert.

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