What is Position Taking?

Position Taking refers to a revenue-sharing structure where an agent assumes a percentage of both the profits and potential losses generated by their downline agents or players. This system is commonly used in credit-based betting networks, where agents are responsible for collecting player losses and settling accounts with the platform. By "taking a position," agents are incentivized to manage risk while expanding their network. In contrast, terms like commission, rebate, or profit share are more commonly used in cash-based platforms, where agents typically receive a share of profits only, and the platform bears all losses.

How Position Taking Works

1. Commission Rate Setting:：
   • The upper-level agent sets a commission rate with sub-agents or players, for example, 60%.
   • This means that regardless of whether the player wins or loses, the upper-level agent will take on 60% of the profit or loss.
     
     
2. Profit Scenario:：
   • If a player loses 1,000 units in a month, the upper-level agent receives 60% of that loss, which equals 600 units.
   • Upper-level agent’s profit = player’s loss × position taking rate (1,000 × 60% = 600).
     
     

3. Loss Scenario：

   • If a player wins 1,000 units in a month, the upper-level agent must bear 60% of that profit, which equals 600 units.
   • Upper-level agent’s loss = player’s profit × position taking rate (1,000 × 60% = 600).

Significance of the Position Taking Model

• Risk Sharing：Through the position taking model, upper-level agents share both profits and losses with their sub-agents or players. This encourages agents to actively manage players and helps reduce disorderly or excessive gambling behavior.
  
  
• Profit Sharing：Agents can earn from player losses, but they must also bear losses when players win. This profit distribution mechanism supports long-term sustainability of the business.
  
  
• Motivational Incentive：Since upper-level agents are responsible for player winnings, they are motivated to provide better service and management, which in turn improves player retention and overall profitability.

Calculation Example

Assuming your position taking rate is 60%, here are the specific scenarios:

1. Player Loses：If the player loses 2,000 units in a given month, the upper-level agent earns 60% of that amount, which is 1,200 units.

• • Earnings Calculation: 2,000 × 60% = 1,200 units.
    
    

1. Player WinsIf the player wins 3,000 units in a given month, the upper-level agent must bear 60% of the loss, which is 1,800 units.

• • Loss Calculation: 3,000 × 60% = 1,800 units.

Challenges of the Position Taking Model

• Risk Management：Upper-level agents must possess strong risk management capabilities to avoid bearing excessive losses when players win.
  
  
• Liquidity：Agents need to maintain sufficient cash flow to handle potential high-loss scenarios.
  
  

In summary, position taking is a double-edged sword — it can bring profits but also carries risks. Agents must find a balance within this model to both attract players and effectively manage risk.