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General Betting
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Financial spreadbetting companies offer leverage for customers as long as the customer has a stop loss in place. Would this improve liquidity for the exchanges?
Example: A trader has £10,000 back at 3.15 looking for a 1 tick profit. If he had a facility on Betfair whereby he could dial in a (site administered) stop loss, say at 3.5, (for around 5% loss) , why not allow him to put on 20 times his principal. £200,000?
Yes the trader may have absolutely no intention of taking a £10k loss, but why no facility for those who would leverage themselves?
Even for a punter betting £100 on Man Utd at 2.0, if he has a (site administered) stop loss on at 4.0, said punter may fancy risking a little more.
There are problems everywhere - the price may gap so customers using a stop loss facility would have to have some sort of credit clearance if they have insufficient funds. It may not work in-play because of extreme price fluctuations, but maybe it would attract heavy liquidity.
Or do people need protected from this kind of thing??
Example: A trader has £10,000 back at 3.15 looking for a 1 tick profit. If he had a facility on Betfair whereby he could dial in a (site administered) stop loss, say at 3.5, (for around 5% loss) , why not allow him to put on 20 times his principal. £200,000?
Yes the trader may have absolutely no intention of taking a £10k loss, but why no facility for those who would leverage themselves?
Even for a punter betting £100 on Man Utd at 2.0, if he has a (site administered) stop loss on at 4.0, said punter may fancy risking a little more.
There are problems everywhere - the price may gap so customers using a stop loss facility would have to have some sort of credit clearance if they have insufficient funds. It may not work in-play because of extreme price fluctuations, but maybe it would attract heavy liquidity.
Or do people need protected from this kind of thing??
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Replies: 8
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Sports betting is much more volatile than financial markets, not to mention what could happen during the outages !!
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I used to trade warrants without leverage and those are volatile.
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Yes there are a few financial markets that are very volatile, like warrants and futures/options, especially in the last day(s) before they expire, but you wont get much leverage in these cases.
Sports betting is still much more volatile than these markets. |
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I went for a beer a while back with a group of old school friends, one of which (who was never very bright) was telling all and sundry that the stock market was a good place to gamble because even if the stock dropped in price you never lost your money. This was the day after I went short on Enron at $9.80.
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That's the way it does work for the city ponces Alex.
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Of course they're not gambling with their own money.
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How some pension funds trust themselves in the hands of these people is really quite frightening.
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Regrettably investing on betfair are not prescribed investments although investing in betfair is.
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