Hi Marshy - well, let's look at this way: if you put commissions aside, if you randomly bet on everything on Betfair where there was a fully liquid market (i.e. no gap between the back and lay prices), in the long run you probably either roughly breakeven or probably incur a slightly negative return (after commission of course, it would be a few percent less).Marshy10 wrote:Hi Nomadic,
"Sure, the losing side of your arb may sometimes be on the bookmaker's side (giving them a short term gain in that particular instance), but in the long run, those are losing bets for the bookmaker."
Can you please explain why in the long run these bets are bad for the bookmaker?
But what if you only bet on objects where you were offered odds that were 5% or more higher than what was on offer on Betfair - and there was also no commission? You might lose in the short run (if you are simply unlucky), but chances are you would win in the long run...
Perhaps your question comes from the assumption that bookmakers like to "balance" their books, and only move their odds to keep this balance? It's a popular misconception, but that's not really the case. Most punters (especially those that stick with using traditional bookmakers) overwhelmingly enjoy betting on favorites. And especially rarely bet on the draw.
In order for bookmakers to even potentially balance their books, they would have to increase the odds on the draw and on the underdog to such heights that it would exceed probability. But if you have the cash, it works out more profitably in the long run just to leave the book unbalanced and pocket big offsetting profits when the underdog wins or the result is a draw.