Trading is impossible now

[steven1976]

Do you think you and others will help grow the exchanges or cause damage in the long run considering bf prefer to drive new customers to their sport book?

[xitian]

Do you think you and others will help grow the exchanges or cause damage in the long run considering bf prefer to drive new customers to their sport book?

I think that's an interesting area of discussion. But I more like to question whether the sports markets are quite as scalable as lightwing suggests they'll become in future (or how well it will "develop" as he puts it).

For a long time I was of the opinion exchanges would kill off bookmakers, but that's not even begun to happen, and I'm not sure it will now. And on a related topic, Betfair justify their premium charge by saying they needed the money to draw in new (losing) customers, and without it, it would eventually result in all the losing people having lost all their money and traders and bots just consuming each other until there would be only one player left. On the one hand, that's pretty absurd. Bookmakers have had a constant stream of customers for centuries, so why shouldn't exchanges.

However, on the other hand, thinking about things more closely, do we really think betting exchanges will develop into a size even beginning to compare with financial exchanges? Nowadays my viewpoint is no. Ultimately, financial exchanges provide a service of allowing people to hedge financial risk, invest in long term products, allowing people to raise capital, etc... and in return traders (in the loosest sense) get compensated with a commission. What value do sporting exchanges offer with which to earn a buck? The only thing I can think of is the value of the entertainment offered for the punter.

From that point of view, I don't see how betting exchanges can evolve to anything as complex or vast as the financial markets with all of its complex products. More likely I see highly sophisticated syndicates (or "companies" if the gambling world were ever to be taxed in the UK), like Lightwing's, who become the main operators of betting exchanges - offering up highly efficient market prices, leaving very little room for other traders, effectively turning the whole system back into a bookmaker.

So in answer to your question Steven - no, it's probably not a good thing for all the average Joe trader. For the punter? They probably won't see much change in the industry.

[LeTiss]

The worst thing that has happened with regards to the bookies, is FOBT's and all the bollocks like virtual casinos online. They have become so used to hoovering up guaranteed money, they have lost the art of bookmaking. They have forgotten how to be competitive with prices, and forgotten how to take chances by taking a large punters bet.

[Westerner]

This has become a very interesting thread.

Sealebet - yes I'm aware of the book Flash Boys and it's pretty much what I'm referring too.

Main point here is the market is moving whilst money is coming in on the countdown clock (currently 5 secs in cricket).

Bots shouldn't be able to act on this information (i.e. what orders and how much) until the money hits the market (as far as I'm aware).

And before anyone mentions TV delays/snipers, I have taken those into account too.

Not qualified to comment on Horse Racing markets, but it's interesting to read where things are headed under the likes of Lightwing etc.

Will just add I have no problem with bots at all.

As long as they are acting on information 'in' the market and adhering to the same bet placement delays as the rest of us.

[Euler]

I think the algo trading stuff is overblown a bit and a bit trendy at the moment. I must have met at least 20 people who reckon they are 10% of the market, but also unique in their approach; when I know others doing exactly the same thing.

I did a blog post on it recently: -

http://www.betangel.com/blog_wp/2016/11 ... t-markets/

When you triggering on a trigger that was triggered on a trigger you can end up with some really odd situations. It feels to me on racing that the market has much more noise in it now compare to a few years ago. But the underlying fundamentals are more or less the same. So it will inevitably catch people out that work on tiny margins unless they adapt.

The biggest contributor to fairness in the marketplace however is Betfair, so that's what you should be worried about more than other participants IMHO. If Betfair choose actively or passively or by accident to modify the behaviour of the market that's far more damaging IMHO.

[iambic_pentameter]

Euler,

I guess the smart solution, is to really know how markets work in a particular sport and have the skills to execute both a manual and automated strategy?

Based on your experience in the markets, do you think that automation will ever replace manual trading, or can both quite happily co-exsist in the market(s)?

Iambic

[gazuty]

I think the algo trading stuff is overblown a bit and a bit trendy at the moment. I must have met at least 20 people who reckon they are 10% of the market, but also unique in their approach; when I know others doing exactly the same thing.

I try to not account for more than 2% of any Saturday horse market (other days I might be up to 5%). When I go beyond that bad things tend to happen (to me). 10% would be quite something.

When I was excluded from certain Aussie markets (on a "voluntary" agreement basis with bf) I really didn't notice any difference in the relevant markets. They didn't miss me. Maybe my volume and liquidity was missed or maybe other bots filled the void. Unfortunately there is no known way of running the parallel universe to check. But one thing is for certain when I (or anyone else) participates in a market it is irrevocably changed from the point the bet is placed (assuming the bet is placed somewhere near the money).

[Euler]

Based on your experience in the markets, do you think that automation will ever replace manual trading, or can both quite happily co-exist in the market(s)?

Both can operate in the market and are often mutually exclusive in terms of what they are expoliting. My biggest trades tend to come from manual trades and that is the case again this year.

[LeTiss]

That is because experience can give you hunches as to what's going to happen next - bots don't get hunches!

Of course, the flipside is they don't get rushes of blood to the head, or explode into fits of rage

[cybernet69]

There is a company in London which operates an AI bot on sports markets. They also employ a number of people who attend sports fixtures around the country and feed into the bot's algorithms. I seem to remember some of them being arrested at a tennis match but later released without any charges being brought.

[iambic_pentameter]

Thanks for the reply, Euler.

[jupiter_man]

Since you are Chinese (from your name), may I point you to my Chinese media account: https://www.zhihu.com/people/li-yi-rui-30/activities. You could also google my username to find out a bit more about me. Anyway, there are some articles in Chinese I wrote that may help provide a vague idea.

Hi Lightwing,

First of all, as a Hong Konger who is living in London now, I am absolutely amazed by your Chinese, I know a lot of foreigners can speak good Chinese, but to be able to write so many articles in fluent Chinese as well? I was shocked, then I read about your background then I am so happy with what you have achieved in life. 加油!!

Anyway I have just read your Zhihu and found so many great articles and learnt a lot. I have got a friend who works for HKJC, what he taught me about odds is actually very similar to what you wrote. There is no doubt yours is more in depth, especially comes with so many different innovative data analysis between bookmakers. And your result did prove what my friend told me, some bookmakers do silly price and wrong price are corrected in no time.

[Ica73]

Today +100 for me, but the market is very very difficoult...

[spreadbetting]

Why did you think the market was difficult if you've had one of your best days for a while? I pretty much work to a script regardless, so if things go my way I'd see it as an easy day whereas a difficult day would be things not going as I'd hoped and only scraping out a few quid or a loss.

[Ica73]

The market is difficult today because I had to work with maximum concentration and maximum speed. I had to force things, I had to abstain for the majority of the time. It 's true I got one of the best days in the last six months but my today's earnings do not consider it normal, but an' exception.