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There was a letter in the racing post today where a trainer appears to be mixed up about how the BF commission system works, can anyone tell me how he might have come to the conclusion below:
A Wolverhampton race had £434k matched on the win market and £92k matched on the place market.
He says this resulted in £18,410 in commission to Betfair
A Wolverhampton race had £434k matched on the win market and £92k matched on the place market.
He says this resulted in £18,410 in commission to Betfair
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Perhaps he was a layer and was factoring in his premium charge.
526 X 3.5% = 18.41
That's how he got it, i believe the correct calc. would be 263 x 2-2.5% = 5.26-6.57
That's how he got it, i believe the correct calc. would be 263 x 2-2.5% = 5.26-6.57
He appears to have taken the average commission paid to be 3.5% (which it is not), and then assumed that Betfair would have received this %age of the total matched.
Betfair would only received anything remotely approaching this amount if all the customers who had bet in this market had taken totally one-sided positions. Anyone who traded at all would have added to the matched total, but not added proportionally to Betfair's commission take (worst case scenario for Befair, the total traded on that market would have resulted in every participant having zero p/l, and therefore paying no commission).
And even if the customers all had one-sided positions, the total liable for commission is only half that of the total matched.
Betfair would only received anything remotely approaching this amount if all the customers who had bet in this market had taken totally one-sided positions. Anyone who traded at all would have added to the matched total, but not added proportionally to Betfair's commission take (worst case scenario for Befair, the total traded on that market would have resulted in every participant having zero p/l, and therefore paying no commission).
And even if the customers all had one-sided positions, the total liable for commission is only half that of the total matched.
Yes schoolboy error, not unsurprising given its Racing Post and a horse trainer. Almost like they want to give out misleading opinion 
Total nonsense; To work out comission you have to know the amount matched against each losing bet.
Let's suppose £100 gets matched at 1.1, (that's really £50 backed and layed of course), then that's £50 at 1.1;
If the 1.1 shot comes in, then the backer wins £5 and pays 25p commission. If the 1.1 shot loses, then the layer wins £50 and pays £2.50 comm.
To just take the matched amount across the whole market isn't enough info to calculate commission. Nonsense from RP there, unless they actually looked at the amount matched against each outcome and were aware of the double counting.
Let's suppose £100 gets matched at 1.1, (that's really £50 backed and layed of course), then that's £50 at 1.1;
If the 1.1 shot comes in, then the backer wins £5 and pays 25p commission. If the 1.1 shot loses, then the layer wins £50 and pays £2.50 comm.
To just take the matched amount across the whole market isn't enough info to calculate commission. Nonsense from RP there, unless they actually looked at the amount matched against each outcome and were aware of the double counting.
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