General Betting
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We gamblers can only pray
We gamblers can only pray
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I still don't understand why these market makers don't just put up 101% or smaller like in other sports. The traders are then taking their life in their hands if they undercut it.
There's obviously a lot more to compiling a set of odds for a horse race than the likes of a football game and that would be the case even if the game was 100% straight. If betfair's biggest winners on horse racing did what you suggest they'd be guaranteed to lose money. Actually I think I do understand it and have hinted at it above, but it seems fair that the person who prices it up SHOULD have a monopoly. Don't know what you mean by that. On feckfair, once someone's identified where the tissue is, they can just copy the prices and put big lumps there, even if the market maker is small time. Or that. |
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Trader friendly reduction factors is another reason the early horse markets are tumbleweed.
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Why do they suddenly care on betfair at 1530?
Presumably because their balance has been tied up until after the previous race? Again, I don't understand horse racing in the same way as you don't understand non horse-racing. What I do know, is they're different things and your crusade would knacker up most of the other sports betting that goes on here against what you're trying to achieve. |
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On feckfair, once someone's identified where the tissue is, they can just copy the prices and put big lumps there, even if the market maker is small time.
They'd be welcome too. The horse racing markets aren't efficient even at the off. |
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*welcome to.
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There's obviously a lot more to compiling a set of odds for a horse race than the likes of a football game
I can't see that it's any harder or easier (Assuming all the sports are straight that is) |
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If they aren't efficient at the off, then why is anybody complaining about the system in place? Just bet the wrong ones and wipe out the naughty traders?
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I can't see that it's any harder or easier (Assuming all the sports are straight that is)
What's that John McEnroes phrase? If they aren't efficient at the off, then why is anybody complaining about the system in place? Just bet the wrong ones and wipe out the naughty traders? You already know why I'm complaining. If you think me taking advantage of wrong prices at the off would result in me wiping out traders there's not really any point in attempting to educate you. |
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You already know why I'm complaining.
Actually I really don't. If there are people putting up wedges of incorrect money at the last minute on an event and that money is there to be taken for profit, I don't see why you care how it got there. Even better, if the money ends up in the wrong places because of traders, surely this should be embraced? I don't think I'm a trader by your definition (Though I do pay PC, so I might be), but I genuinely don't understand your gripe at this point. If it's simply that you can't be bothered to wait until the off to have a bet, I think the problem is yours, not the systems. |
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I'm complaining because the trader friendly interface (and RF's in horse racing) deters liquidity and has turned this place into last5minutes.com. Also, the pc (which was mainly brought in to deal with cheats and traders) deters new custom and the plethora of betfair created "professional gamblers" will ultimately lead to taxation which will decimate liquidity. Everything that is bad about this place is a result of favouring groups of people who contribute nothing to the exchange experience.
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Why have the traders turned it into last 5 minutes?
Forgetting horse racing, where else does this happen? It seems that for whatever reason (probably the immense difficulty of judging whether a fast beast will beat a slow one in a fair race), horse racing tissues are made up to a much higher ovveround than those in other sports. The issue lies with that mentality, and not with the traders. If someone's going to price a market to 125% then obviously someone is going to undercut it, in the same way that if i tried to sell cans of beans for £3.20 a can, I'm not going to do very well. Put your prices to a sensible level and the traders won't have anything on which to feed. Either that or just take their good prices and let them lose on the bad prices. (I actually don't see why this wouldn't send them skint, feel free to enlighten me) |
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You seem to be confusing traders with interface.
Put your prices to a sensible level and the traders won't have anything on which to feed. Either that or just take their good prices and let them lose on the bad prices. (I actually don't see why this wouldn't send them skint, feel free to enlighten me) I can see why you're unsure if you're a trader. |
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Well I don't think I'm a trader but your definition is rather odd, so in your eyes I might be.
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What is it you're claiming here Investor? I get the impression from your "Only a trader can profit from a spread like that" line that you think the people on the other side of your trades wouldn't have been matched in your absence. I could maybe see your point if you'd backed at 12.2 and laid at 12.44 but why wouldn't those you were matched with just be matched with each other at better odds (unless you're claiming it's losing traders on the other end of your bets)?
Feck, what I'm saying is that a successful gambler (as in straight bettor) can't compete with me to offer a better price. My assumption is that the people on the other side of my bets are on average either traders or losing gamblers. A successful straight bettor will only be on the other side of my bets if he thinks the price is at least a few ticks out, otherwise he can't profit. What would have happened in my absence is either the guy on the other side of my bet backing at 12 would have backed at 12, or at 11.5, or not at all. Three options, none of which leave him worse off. So in my absence another (likely successful) trader would have stepped in my place either at the same margin (laying at 12), or a better one (laying at 11.5). Granted there will always be a place for successful straight bettors, for instance, if they think Chelsea should be 1.4, but they are trading at 1.3, they will lay Chelsea. If the selection is massively overbet, it might not reach 1.4 or anything close to that, in which case it could make sense not to trade out. Traders drive the margin down to close to zero, which is good for all losing gamblers (at least 80% of bf customers). Without me, the bets probably would have been matched anyway. The key is that thanks to my involvement, they are getting matched at more efficient (or in the worst case equally efficient) prices. The smaller the difference is between winners and losers, the more funds churn, and the larger the slice of the pie that ends up going to Betfair themselves relative to winners. Almost everyone that makes a consistent profit on betfair is getting paid to keep markets efficient. Successful straight bettors get paid by taking prices that are out of line, thereby bringing them in line, or offering prices that are less out of line than the next best offer. Successful traders get paid by keeping the spreads tight. |
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I have a feeling Feck will be along to comment on your last post Investor.
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Feck N. Eejit
When: 18 Mar 11 10:00 Joined: Date Joined: 10 Jan 02 | Topic/replies: 3,152 | Blogger: Feck N. Eejit's blog No, if all the punters put up their money that's an indication of what way the market's likely to move which is what the traders are looking for and why they're absent until last5minutes.com is in full flow nearer the off. Based on those indicators they'll take down an offer and put it back up at slightly worse odds. No liquidity added there. Your argument is that in their absence nothing would happen so why does the trader reducing the odds on an existing offer make this any less likely. As far as the mythical filling in of gaps goes, in the unlikely event of there being a chasm between best back and lay odds and neither backers or layers are willing to leap frog offers an increment or 2 in front of them why would traders filling in the gaps make those backers and layers suddenly want to leap frog 10 increments? Not sure who this was aimed at, but I'll answer from my perspective: Personally, I don't trade based on where I think the price is going to go. I trade based on where I think it should be. If anything empty markets are great for me, as I will be front of the queue everywhere, and make money pretty much by default. When the site is up but the API is down, my profit expectancy more than doubles, as so many of the main market makers are taken out. Regarding the last bit of your post, the reason that traders filling the gap, leads to more getting matched, is that many people only take a price that is there, rather than offering. So if the spread is 1.8-2.2, they won't bother offering 1.9, but they might take 1.9 if the spread is 1.9-2.1. |
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By the way, in empty low liquidty markets, I become a straight bettor. Trading out is difficult, but I have a large margin to compensate.
If more traders competed with me, it would become easier for me to trade out, and I could lower my margins. |
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christ feck, do you do anything else?
if you put 10% of the time you currently put into this endless futile argument for changes that shouldn't and never wil happen into finding more effective ways to use the system that actually exists, you'd make more money. so if not making more money is at the heart of your complaint, stop wasting so much time doing something that will never make you a penny. |
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The Investor: Traders drive the margin down to close to zero
I do not understand why punters w/ opposing opinions don't do this. In the sport I play, horses, it is highly unlikely that traders have a pricing edge over either the recreational punters they beat or the opinion-winners w/ whom they exchange money. The traders are either following directional movements (typically cued by information conveyed by the interface), using some technical procedure such as correcting overshoots i.e. range-trading or WOM, or betting right before the off in such a way as exploits people's desire to get a bet on i.e. market-making or scalping / tick-trading on multiple outcomes. There is almost no sense that the liquidity they have put up has actively tightened the spread and helped the price-insensitive punter get a better price. Traders' whole rationale is to extract a rent from betting activity on the basis of a purely technical operation. I don't think that the same is true of IR players on continuous action sports, who in leaving up or taking prices at particular points in the game accommodate those who have a different idea of what the odds shd be at that point. |
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What would have happened in my absence is either the guy on the other side of my bet backing at 12 would have backed at 12, or at 11.5, or not at all. Three options, none of which leave him worse off. So in my absence another (likely successful) trader would have stepped in my place either at the same margin (laying at 12), or a better one (laying at 11.5).
I've no idea the time period between your opening and closing bets or whether you took an existing offer or made an offer on your opening bet so my saying the people at either end of your trade might match each other in your absence may or may not be practical. I think it's a bit of a joke though you saying "another (likely successful) trader would have stepped in my place" (I suppose there's no chance one of the punters who matched your closing bet could've matched it). I'm surprised you've not attempted to guess their name and address. I earlier wrote "As far as the mythical filling in of gaps goes, in the unlikely event of there being a chasm between best back and lay odds and neither backers or layers are willing to leap frog offers an increment or 2 in front of them why would traders filling in the gaps make those backers and layers suddenly want to leap frog 10 increments?" To which you reply Traders drive the margin down to close to zero, Regarding the last bit of your post, the reason that traders filling the gap, leads to more getting matched, is that many people only take a price that is there, rather than offering. So if the spread is 1.8-2.2, they won't bother offering 1.9, but they might take 1.9 if the spread is 1.9-2.1. Did you actually read what I said? You seem to be under the impression that the only people who put up offers are tissue makers and traders. In the morning punters have bookmaker early prices to refer to. Near the off they have sis prices. They've as much idea of what price they're looking for as you or I have. Your theory that traders fill the gap and that it would never be filled in their absence is crazy. You also seem to be under the impression that all tissue makers arrive at the same price, that the mid-point of the spread is in between their universally agreed tissue and so they never participate in closing the gap. |
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christ feck, do you do anything else?
if you put 10% of the time you currently put into this endless futile argument for changes that shouldn't and never wil happen into finding more effective ways to use the system that actually exists, you'd make more money. so if not making more money is at the heart of your complaint, stop wasting so much time doing something that will never make you a penny. I'm touched by your concern pres but, as you can see by this thread, education is a long process. I daresay you're correct though and my argument is as futile as the one I made for years regarding the introduction of a charge along the lines of the pc. Here's another argument you'll be hoping I'm wasting my time with The all new liquidity generating Premium Charge = (GrossProfit - 5 * CommissionGenerated) / 2 |
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PS Re wasting time
Feck N. Eejit Joined 10 Jan 02 Replies 3156 viva el presidente! Joined 10 Jun 06 Replies 7261 |
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Lori, the reason that traders in horse markets do not participate until late is that they are only then safe to run their technical operations as informed by the information supplied by punters.
What you say about the leakage of info. in horses is broadly correct but very politely put. In any non-elite or major target race, there will be a significant number of horses prepping for another event, running to get their hcap mark down for a touch later in the season, trying new tactics, regaining race fitness, returning after a non-reported operation on wind or a soft palate, wearing first-time headgear, racing after having been extensively schooled or running for their lives. Connections are in possession of this info. and gradually and non-obtrusively try to cash in until right before the off. Now, racing is a sport where someone who can persistently pick runners with a 12% chance at 10-1 makes 32% at level stakes. But the difference in chances between these outcomes will seem minuscule in pricing up a 20 runner race. Each and every of the runners will be affected by unknown, hard-to-weight and publicly available factors. Because they are on the wrong side of an information asymmetry, good pricers-up (backers, layers or bookmakers) will leave themselves a greater margin (I will lay the horses I dislike--always at least 25% of the book--to small money early before pricing up to 110% as the market starts to form. There will be positions I am standing at the end, esp. on the back side, unless prices have moved in 70%+ of cases to virtually my tissue fair-value prices). I have the sense that all this will only confirm your preconception of the game as archaic, arcane and bent, but to this I can only say that the range, complexity and human element of the variables involved in its pricing are what to me make racing the most interesting sport. |
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askari1
The Investor: Traders drive the margin down to close to zero I do not understand why punters w/ opposing opinions don't do this. Because they can't profit from it to the same degree traders can. |
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Feck, how about this in relation to horses?
Bf must be sick of all those adverts 'best price guaranteed', 'bet with the green tick', 'we guarantee to match the prices of any major bookmaker, any bookmaker on oddschecker' etc. when all these bookies are sitting under the bf price and shunting off any winners or price-sensitive punters onto bf. Someone at bf must be thinking, 'we're not growing and we are a bookmaker. We're paying a turnover tax in Victoria and are not going to get licensed in other jurisdictions unless we present something that the authorities readily understand'. So why don't they set up the main sports.betfair site as a back-only bookmaker offering recognisable prices to pre-announced takeouts? If someone wanted to lay or trade, they wd have to log into another site, exchange.betfair.com, say, and agree to be registered as a layer once their profits passed a certain level? We wd see whether it's traders who are responsible for fine prices or a difference of opinion among punters. Meanwhile bf cd blanket the press in ads pointing that the price the fixed-odds books guarantee not to beat is bf's and that they will match any price or make up the difference (they could buy up fracsoft and offer/charge for market snapshots to the sec.) |
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Feck N. Eejit
I've no idea the time period between your opening and closing bets or whether you took an existing offer or made an offer on your opening bet so my saying the people at either end of your trade might match each other in your absence may or may not be practical. I think it's a bit of a joke though you saying "another (likely successful) trader would have stepped in my place" (I suppose there's no chance one of the punters who matched your closing bet could've matched it). I'm surprised you've not attempted to guess their name and address. Here's my logic: Most leisure punters take prices, rather than offer. Most successful gamblers will only offer or accept a bet if they expect to make a profit. As the person taking my place on the other side would like me be offering, that person is most likely a trader. Did you actually read what I said? You seem to be under the impression that the only people who put up offers are tissue makers and traders. In the morning punters have bookmaker early prices to refer to. Near the off they have sis prices. They've as much idea of what price they're looking for as you or I have. Your theory that traders fill the gap and that it would never be filled in their absence is crazy. You also seem to be under the impression that all tissue makers arrive at the same price, that the mid-point of the spread is in between their universally agreed tissue and so they never participate in closing the gap. The stament "They've as much idea of what price they're looking for as you or I have.", is clearly false. Most punters don't even bother comparing odds across bookies, let alone go through the procedure you describe above. Rather than 'looking for a price' their though process is more likely going to be, "I think this team will win" and then they back them at whatever the odds are. Without traders a gap may or may not be filled. But one thing's for sure: It can't be filled by profitable straight bettors, as they will likely both lose in the long run backing an evens shot at 2.02, or laying it at 1.99. It boils down to this: Traders can profit from stable efficient prices, straight bettors cannot. |
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Traders could not profit from a bf market deducting commission on a fair coin toss, with 1.98 and 2.02 on opposing sides of the spread. They do not 'contribute liquidity' to exchange games b/c the operator has got there first.
Traders w/ no opinion wd also not like step-changes in prices where in an abrupt, non-orderly way, prices jumped from one equilirium to another (let's imagine this happened three times in a market before settlement). Of course punters (inc. those locking in profits and losses) w/ an opinion wd not mind this. Horse punters w/ opinions do discriminately take morning prices. In a betting shop opening at 8.30 am, you will get me (sometimes) and a handful of other people taking standout and Pricewise prices or prices b/f they go to work. You then get nothing until 10.30 to 11, where the FOBT players and indiscriminate price bettors start coming in. Traders will play the PW prices because someone has supplied them w/ an opinion. Fortunately for PW, he is paid by results (on largely fictional odds); unfortunately for the rest of us w/ an opinion on f, we have views we are not getting paid for. |
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The stament "They've as much idea of what price they're looking for as you or I have.", is clearly false. Most punters don't even bother comparing odds across bookies, let alone go through the procedure you describe above.
Rather than 'looking for a price' their though process is more likely going to be, "I think this team will win" and then they back them at whatever the odds are. This is a really exaggerated portrayal of a group of players you presumably beat and think little about. In fact I wd say that many shop players are acute and refined judges of events but lose b/c they are irregular players (they have other worries and commitments) and cannot control their emotions. |
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By 'I don't understand why punters don't do this', I was saying that punters in fact close the spread equally well just by virtue of having different opinions and pricin mechanisms.
Surely (depending on capital employed and number of markets played) a price-taker will do equally well acting to get prices to their tight equilibrium level as a player (this looses assumes the settled level represents fair value). I can understand that often tight prices don't give the price-taker the margin for error he needs to enter the market, but we are talkig about who and what close the spread in the act of market formation. |
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* will do equally well as a trader
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I don't think my statement about most punters was exaggerated really. Maybe I'm wrong about that, but I just can't imagine there are a lot of people out there taking it really seriously and then going on to place bets at ridiculously bad bookie odds.
Askari, imagine the experiment of putting a few hundred people who don't bet in a room together, and giving them £100 each to bet against each other on a football match. They all offer prices (or take prices) like we do through the betfair interface. The rules are, they have to bet their £100, and then get to keep the stake+winnings if the win. What I think would happen is that a few of the people who have a very rough idea of what the odds should be will offer prices. The people who don't have a clue will (if they act rationally) wait for consensus to form on price. Eventually you will expect these punters with different opinions to come together and close the spread on price. As we've purposely selected people who don't bet, it could easily happen that this consensus price is quite a bit off from the 'more accurate' price on betfair. The people offering and taking at the right prices, tend to be those people who know what they are doing. So most punters entering this price zone will get picked off by traders, while the straight bettors who are capable of accurately pricing it up stay away altogether as margins are too small. |
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The investor, the last para. was the bit I said I understood, but yr scenario doesn't really address the issue of how markets come to form. (Although perhaps it does in implicitly conceding that market makers and traders take their cue from people who have an idea of what the price shd be).
Yr closed-room scenario is nothing like any situation in the real world. Horse bettors have a morning oddsline and there is a wealth of information, indluding explicitly on pricing and chances, for football. The RP has started showng which of the teams are fancied by its columnists on the paper's odds box. Traders can do well from range-bound or directional movements in more or less stable markets, but they haven't been the people who determined where the market shd be. |
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Here's my logic: Most leisure punters take prices, rather than offer. Most successful gamblers will only offer or accept a bet if they expect to make a profit. As the person taking my place on the other side would like me be offering, that person is most likely a trader.
The stament "They've as much idea of what price they're looking for as you or I have.", is clearly false. Most punters don't even bother comparing odds across bookies, let alone go through the procedure you describe above. Rather than 'looking for a price' their though process is more likely going to be, "I think this team will win" and then they back them at whatever the odds are. Askari's already taken care of this for me Investor but, to sum up, the first mistake you're making is assuming that these brain deads would bother opening an account with a firm who insist on having such a complicated interface and a commission system that people with maths degrees have problems with. The second is assuming that all traders have a clue about what the odds should be like yourself (an assumption that is particularly hilarious with respect to horse racing). If only it was that easy, stick up a lay at true price, a back a chasm away and traders will fill in the gaps giving you a back at the mid point of the chasm. Of course, according to you, I'd have to share that back with all other tissue makers who will inevitably agree with me. |
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Most punters don't even bother comparing odds across bookies, let alone go through the procedure you describe above. Rather than 'looking for a price' their though process is more likely going to be, "I think this team will win" and then they back them at whatever the odds are.
I'm sure even online bookmakers would tell you that is so wrong. Their gross profit percentages are way below the average shop wrt horse racing. |
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Askari's already taken care of this for me Investor but, to sum up, the first mistake you're making is assuming that these brain deads would bother opening an account with a firm who insist on having such a complicated interface and a commission system that people with maths degrees have problems with
And still you want to make it even more difficult by introducing hidden queues and some kind of a price auction system ? Do you really think that would attract more customers to Betfair ? |
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In what way would it be more difficult Eddie?
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So why don't they set up the main sports.betfair site as a back-only bookmaker offering recognisable prices to pre-announced takeouts? If someone wanted to lay or trade, they wd have to log into another site, exchange.betfair.com, say, and agree to be registered as a layer once their profits passed a certain level? We wd see whether it's traders who are responsible for fine prices or a difference of opinion among punters.
Meanwhile bf cd blanket the press in ads pointing that the price the fixed-odds books guarantee not to beat is bf's and that they will match any price or make up the difference (they could buy up fracsoft and offer/charge for market snapshots to the sec.) Do you mean betfair would stand the bets in the absence of there being any layers askari? If so, I'd be even more worried about front running than I am now. If not, I think they'd just become another bookmaker you couldn't get on with (early on at least). I think you'd also have to take into account that the more popular a horse is the less it's likely to trade over the odds on betfair. |
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I guess we just have to agree that we disagree if you think Feckfair would be easier to understand for the average Joe punter.
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More stable prices, only prices from previous auctions showing (a bit like the sis show), submit your back/lay along with your min/max acceptable odds (or choose 'auction sp'), no need to play leap frog. What's harder to understand about that?
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As I said, I think that's much more complicated that the Betfair interface and it's impossible to know if you are matched instantly.
No way to know that until the next auction is scheduled. At least today you can take a price and know your bet is matched and at what price. |