An interesting conflict in signals

[stueytrader]

Wondering what peoples views are on this scenario, and how to read/play them:

When bookies prices are heavily shortening, but the exchange market shows same selection lengthening (over the same times periods).

I had one of these yesterday - Irish horse running at Newcastle, was fairly sure it would run well due to trainer etc, and it did run quite well in the actual race (lead with a furlong and half to go and traded much shorter inplay). However, all morning especially closer to the race it was heavily drifted by the exchange market...?

Any thoughts on these type of selections, or experiences would be interesting to discuss - I ended up taking a smallish loss on some earlier backs, despite the fact I could have got out with a decent profit inplay...

[stueytrader]

Just to clarify the example, almost all the books shortened it during the morning (quite heavily) while at the same time the exchange market continued to drift it heavily pretty much up to the off.

[Derek27]

It's quite hard to imagine how or why a horse would be backed with the bookies but drift on the exchange, as the bookies are almost hard-wired to the exchange, but it would be interesting to know the bookie's overrounds at the time. Either they're quite large or there must be arbing opportunities on one or more of the other runners.

[stueytrader]

Yep, I was basically rather flummexed to think of an explanation must admit.

I know the bookies and exchange prices are not always in sync, but this was in totally the opposite direction of movements. The only thing I could think was that there was a/some very heavy persistent layer(s) around for that selection on the exchange who were literally wanting to lay at any price. Meanwhile, for valid enough reasons, the bookies were actually scared of the selection enough to shorten it...

[ShaunWhite]

These usually shorten at the bookies before they lengthen on BF, not simultaneously. Bookies shorten because they don't want to take any more money on a selection rather than a reassessment of its chances.

The tissue is the form dept, after that it's all about accountancy.

[stueytrader]

These usually shorten at the bookies before they lengthen on BF, not simultaneously. Bookies shorten because they don't want to take any more money on a selection rather than a reassessment of its chances.

The tissue is the form dept, after that it's all about accountancy.

But then the question is why would the books not want to take money on a selection that is patently being given away on the exchange? Surely not that heavily backed with them, when heavily layed to lose on the exchange...?

(Just to note it was pretty much shortened across all of the bookies, not just a couple)