Market manipulation on Betfair

News, chat and debate about the Betfair betting exchange.
foxwood
Posts: 390
Joined: Mon Jul 23, 2012 2:54 pm

1) Do you think that market manipulation happens on the markets?

10/10

(2) What form do you think manipulation takes? I.e. can you describe it?

a) Large sums sitting behind the current price in order to influence direction. Typically never matched and always moving in step with the price. Then reversing a little while later. Sometimes these are genuine sums but those behave differently and are eaten away until the price breaks through.

b) bots marching up and down the prices in illiquid markets and rapidly moving away and never matching punter offers

(3) How does it affect your trading?

50/50 sometimes intimidates so cut out for a loss yet other times go with it. Treat it as being part of the game.

(4) Do you think Betfair care about manipulation, what do you think they do about it?

No they don't care or do anything - nor should they.

Exchanges are a peer-to-peer betting platform that matches "offer" and "take" as is made clear in their T&Cs. Trading is not a service they offer directly and not even sure they recognize it officially - it is just two totally separate bets someone makes as far as they are concerned.

IMHO it is impossible to prove manipulation in peer-to-peer betting. The defence for any bet offered, including sums behind the current price, is that the offer is what the punter believed was a good bet based on the market structure and prices at that time. While such an offer may appear stupid it is impossible to prove that it is not a genuine offer by a mad punter.

200ms later their decision changed and they moved the money. Doing this is such hard work that they decided to use a computer to save them effort and implement their decisions. Oh, and that means they can leave it running automatically :lol:

It might be interesting to have a thread about ways in which speculative / manipulation bets could be stopped or their impact lessened by changing the exchange rules subtly eg unable to change/cancel a bet until it has been in the market for at least x amount of time might have an effect ?
marko236
Posts: 737
Joined: Fri Jul 12, 2013 11:54 am

I think the real problem will come if manipulaters start getting manipulated themselfs, just imagine 5 different people going against each other on a regular bases it will make the markets so hard to read.
steven1976
Posts: 1744
Joined: Tue Jan 19, 2010 6:28 am

foxwood wrote

"No they don't care or do anything - nor should they.

Exchanges are a peer-to-peer betting platform that matches "offer" and "take" as is made clear in their T&Cs. Trading is not a service they offer directly and not even sure they recognize it officially - it is just two totally separate bets someone makes as far as they are concerned."

The problem is when it is no longer peer2peer and tricks are used to create an illusion of something happening. If it was an exchange in the real world it would be illegal to use flash trades. Those doing it would argue that it creates liquidity which it would do in the short term but if it kills any new smaller traders, does it help the long term growth of the exchange when BF are not pointing new customers to the exchange?
Euler wrote:steven1976 wrote:
Come on Hgoden and Peter. At least answer the questions you show an interest in as it's still open.


Do you mean me? I want to let everybody have a clear say. Don't want to be seen to be steering the debate.
Was hoping to give you and hgodden a nudge for a view as sometimes we don't always get your views on these things and then the topic dies off. I know hgodden was unhappy with what was happening some time ago and was ready to go John Rambo on BF, so would be good to hear his views also.
kerberus
Posts: 366
Joined: Mon Aug 05, 2013 3:28 pm

It would not be fair to whisper that a competitor to Betangel has also noticed this is going on but .....

Trading on Betfair: How to win money when high stakes punters flood the market
When the big money comes in you can make easy profit
At certain times of the year, some Betfair punters make huge bets which move markets. Caan Berry explains how to take advantage when this happens, using Geeks Toy software...
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"Knowing when one of these bets is genuine is the hard part, but from there on in it can be some of the easiest short-term profit around."
Caan Berry
Published: 11 September 2014 0 Comments
If you've been actively trading on Betfair recently you may have noticed some rather large genuine bets going into the racing markets.
I'm not talking about those 'stakes' that are designed just to manipulate prices but actual 'genuine' punts, risking up to £20,000.
It can become rather confusing to spot the difference between the two although, after a couple of races with the same thing happening, it can become more obvious.
This kind of behaviour presents an opportunity to place a bet in-front of the big money, knowing it's about to shift the entire market (providing there is still a large portion of the bet unmatched).
Knowing when one of these bets is genuine is the hard part, but from there on in it can be some of the easiest short-term profit around."
:roll:
I put the date in bold letters ...for some reason.
The link is on the secret betfair site (My apologies no Area 51 theories )
https://betting.betfair.com/betfair-ann ... 4-710.html
hgodden
Posts: 1759
Joined: Thu Apr 16, 2009 2:13 pm

1) Do you think that market manipulation happens on the markets?

Yes

(2) What form do you think manipulation takes? I.e. can you describe it?

The markets themselves arent manipulated so much in terms of a price being a large percentage away from where it should be or anything like that.

The manipulation is of people, traders. Building bots that dominate most of the unmatched money on several prices and then smashing through traders orders that arent its own and trying to force them to close for a loss. Creating false impressions in the market to lure traders in and then ramping the other way. Deeply studying trader's behaviours to take advantage of them. Pushing against their orders making it as difficult as possible for them to close.

(3) How does it affect your trading?

:roll:

(4) Do you think Betfair care about manipulation, what do you think they do about it?

Nothing unless it affected their jobs somehow.

The irony is that since PC3 came in it is much easier for an individual with lots of money and know how to dominate much of the markets and other participants here, as it has created a situation where 'they' don't have to hedge all their bets (while normal traders do) as this just creates bumpy P and L's for them over several accounts which will then increase their commissions to the point where they can avoid paying PC.

So in practical terms (especially late on in the markets where most of the real money is being bet) if you put an order in on the wrong runner and the 'market' smashes through you (or rather the person responsible smashes through you) then you can either close for a loss (and the bigger the stake the further away the price will be pushed, although this is by no means limited to large stakes, even small ones are pushed against) then as a trader you can either hedge for a loss (what we're supposed to do right? ;)) or let the bet stand, whereas on the other side the manipulators bot is happy either way, either it has forced your order into hedging against it for an instant profit for itself or, if you dont hedge, then it doesnt care as the bet will just form part of its market making and such bets will even out over time generating more commission for it.

When the PC came in betfair (rightly in my opinion) put in a measure so that successful gamblers wouldn't have to pay it (and they would identify that by how topsy turvy a P and L is - a gamblers P and L will be much more topsy turvy and thus generate large amounts of commissions, so betfair can see that and not make them pay PC which IMO is the right thing to do as to not discourage them.)

This loophole is being ruthlessly exploited, costing betfair and its shareholders God knows how much, and ironically increasing activity on betdaq and with other bookies as all sorts of people (not just above) look to arb between exchanges and with bookies to generate commissions. It beggars belief that people within betfair will respond to certain individuals who moan about the PC with 'just increase your commissions then'.

Ultimately manipulation takes many forms and while betfair don't stop it happening they are not the ones doing it. Aside from the over round bot they have (which a monkey could handle), they don't trade or make the markets; they don't have the skill, knowledge or personnel to do such a complex thing and are happy for others to take the risk while they take the commission.

I take it this is actually going to betfair rather than just some sort of debate? I have no appetite for debate and I'm not the sort of person to join a rape victims support group...
kerberus
Posts: 366
Joined: Mon Aug 05, 2013 3:28 pm

You should be using past tense
Ultimately manipulation takes many forms and while betfair don't stop it happening they are not the ones doing it. Aside from the over round bot they have (which a monkey could handle), they don't trade or make the markets; they don't have the skill, knowledge or personnel to do such a complex thing and are happy for others to take the risk while they take the commission.
Now that BF and BD have been taken over by Paddy and Lapdrogs - what better way to offset large stakes for people(wage slaves)(or personnel as you call 'em) to meet their performance indicators/monthly targets etc. Not noticed that the 5 minute is now down to 1 minute and the the odds go mental. Who else can throw TENS of thousands into a market in the last 60 seconds. Bfairnot cannot even let you login and deposit in that time . :shock:
oscar123
Posts: 404
Joined: Fri Apr 24, 2009 10:18 am

I think manipulation obviously goes on daily at some sort of level, always has and probably always will.

Though I don't think it is something that is done easily. If you are making your money like that then I'm sure there is also a skill element involved and also a lot of risk too. As however big a player you think you are, there will always be someone bigger.

Just as turning up at the racetrack to make use of fast pictures is no guarantee of success, having a big bank to manipulate markets with is no guarantee either. If somebody put £100k into my betfair account and told me the only way I was allowed to make money was to by means of manipulating the market, I reckon that £100k would soon become £50k. I don't think it's a matter of just simply having the biggest bank and controlling the market.

I have no issue with manipulation, as when it is done badly it creates good opportunities for good traders. My only issue would be if some market makers had access to more information than others. I.e knowing that the money has come from a trader, mug punter, well connected layer etc and could then act accordingly, knowing what your next move would be. I have absolutely no evidence or reason to believe that goes on though, it's purely conspiracy. Though sometimes strange things happen where it feels like you are playing with a marked deck, and somebody is two or three steps ahead of you. Though in most cases there are also innocent explanations too.
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Euler
Posts: 24701
Joined: Wed Nov 10, 2010 1:39 pm
Location: Bet Angel HQ

kerberus wrote:It would not be fair to whisper that a competitor to Betangel has also noticed this is going on but .....
That's normal behaviour which happens time to time. You can't really predict when it will arrive, there is no pattern but you can easily exploit it from a trading perspective. So I don't classify that as manipulation.
marko236
Posts: 737
Joined: Fri Jul 12, 2013 11:54 am

Thanks for your view hgodden, i didn't even think about them generating commission an added bonus for them :roll:
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Euler
Posts: 24701
Joined: Wed Nov 10, 2010 1:39 pm
Location: Bet Angel HQ

steven1976 wrote:Was hoping to give you and hgodden a nudge for a view as sometimes we don't always get your views on these things and then the topic dies off. I know hgodden was unhappy with what was happening some time ago and was ready to go John Rambo on BF, so would be good to hear his views also.
It's important here to get unbiased views rather than mine, so that's why I've ducked my opinion, to avoid watering down everybody's else's opinion.
RentonT
Posts: 201
Joined: Tue May 19, 2015 12:26 am

What markets are most people talking about here?

Personally I think pre-off racing markets can't be "controlled" by manipulation to be honest. I think we all see a bit of spoofing etc but surely that carries it's own risk. There is so much money flowing through the market to override manipulation. Surely there would be noticeable changes from historic volumes etc to support this theory that there's lots of manipulation.

Times when it's obvious a bot has pushed through your price holding you in a loss are at less fluid parts of markets or weak markets which is more than understandable so it should be obviously risky entering for a "trade" at these times.

A lot of people say it they can benefit from it and I agree but I think it's being painted out to be a lot bigger than it is. "Attempted manipulation" would be a better name.

Frankly it's a nice and more commonly used excuse now for when things don't go how people want it.
stueytrader
Posts: 863
Joined: Tue Dec 15, 2015 6:47 pm

RentonT wrote:What markets are most people talking about here?

Personally I think pre-off racing markets can't be "controlled" by manipulation to be honest. I think we all see a bit of spoofing etc but surely that carries it's own risk. There is so much money flowing through the market to override manipulation. Surely there would be noticeable changes from historic volumes etc to support this theory that there's lots of manipulation.

A lot of people say it they can benefit from it and I agree but I think it's being painted out to be a lot bigger than it is. "Attempted manipulation" would be a better name.
This is an interesting point indeed - a manipulation bet (e.g. large blocking stake) can still be taken by an opposing big laying player. The only time this would be completely wrong (in all senses) would be similar to the financial market 'flasher' case, if there was the potential for a big bet to 'flash' but not be available to be matched. If that could ever happen on BF, then that would be a different level of problem I think, and potentially fraudulent.

But, if the manipulating bet can be matched, then I don't really see the problem as it is a fair asking price which can either be taken or refused.
kerberus
Posts: 366
Joined: Mon Aug 05, 2013 3:28 pm

Dear Stueytrader
Whaddya call this?
from the bomber thread.PNG
You've got it right about flash trading. These things are difficult to spot - and snip. Look above and below the 20k at 2.3 and the WOM and the total matched and the time.
I have no objection whatsoever about people throwing money into a market - I just want them to let me know when and where they are going to do it before you greedy sods get there first!!!!
Dallas can you PULLEASE send me a bot to spot this?
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jimibt
Posts: 3641
Joined: Mon Nov 30, 2015 6:42 pm
Location: Narnia

kerberus wrote:Dear Stueytrader
Whaddya call this?
from the bomber thread.PNG
You've got it right about flash trading. These things are difficult to spot - and snip. Look above and below the 20k at 2.3 and the WOM and the total matched and the time.
I have no objection whatsoever about people throwing money into a market - I just want them to let me know when and where they are going to do it before you greedy sods get there first!!!!
Dallas can you PULLEASE send me a bot to spot this?
out of interest regards the 20k at 2.3. As and when that was removed, did the price drift out rapidly or were there further similar blocks placed to walk the price down further?? Really interested to know how to exploit this pattern also, from a data perspective.
kerberus
Posts: 366
Joined: Mon Aug 05, 2013 3:28 pm

I was working off a single screen/wifi at a library. I had 95p liability(practicing) .. ..
Saw the 20K and went for it - it is "flash trading" there is a "bomber" thread in the forum. Whomsoever is "flashing" "bombin2g" or is being a "loadaamoney" (do please forgive my miseplling)
who cares? I am perfectly willing to be a charitible receiver for any mug daft enough to flash the cash :mrgreen:
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