Today's Horse Racing

[xitian]

I've seen a lot of activity today today that can only be explained by bots and automated systems. And I mean huge liquidity being thrown around...up to 30k stakes being ramped up pushing very short term on either side of the book put in and self matched quicker than I can even get a bet in. As of next week I am not even going to touch a favourite pre race. Volatility is crazy.

I wonder if a lot of this can be explained by Betfair removing transaction limits/costs. Previously there was a bet limit (including unmatched bets) of 1000/hour but Betfair removed that limit about a month ago. So it could be bots now set to go crazy.

Betfair say this is a trial to see if matched volume goes up, and if it does then they may keep the policy. I'm not sure I really agree with the reasonings behind it. Yes, the matched volume may go up, but it's all still the same money. Surely removing the bet limit isn't going to bring in more customers which is what they need to focus on.

I would have thought pricing method similar to Betdaq would make sense, i.e. give a rebate for people who offer prices rather than take prices, which would improve liquidity.

[jimrobo]

Because of the poorer quality of the racing yesterday it stuck out like a sore thumb. The front of the market is completely traded by automated systems. They can react to price, get in and out way quicker than a normal person can manually trade off it. I've found for a while on highly correlated markets ie 2 very short priced runners I have really struggled to make anything out of them. This is completely because any move on one is accounted for on the second before you can even make a decision to enter or not. This includes manipulated whipsaw moves. Yesterday I saw bots play off against each other and play biggest liability setting between them. They whipsawed the market between 3-4 ticks against each other each time progressively putting bigger walls of money up and cancelling. This all happened within seconds. It's like the futures flipper technique the high frequency systems use around support/resistance points. It's becoming an arms race. I will be avoiding the front end while this is happening because you can't play against it. I just worry itsnonlyna matter of time before they then move up the book.

[hgodden]

Was pretty rough yesterday. They can't do that sort of thing forever though as obviously liquidity isn't always so poor and people will just work out what they're doing and will exploit it.

"Whipsawed" - nice (and accurate) description JR

[Euler]

I wonder if a lot of this can be explained by Betfair removing transaction limits/costs. Previously there was a bet limit (including unmatched bets) of 1000/hour but Betfair removed that limit about a month ago. So it could be bots now set to go crazy.

You still have data usage charges, so that wouldn't be a valid explanation.

[jimrobo]

not if they're a pc3 customer sat in a data centre next to betfair!

[Euler]

Be careful 15:50 is a false market.

[PeterLe]

Be careful 15:50 is a false market.

How do you mean Peter?

[steven1976]

Does that mean i get a refund?

[to75ne]

i think earlier it showed the 2 reserves in the market 12 runner race instead 10 runner hence false market

[PeterLe]

Got ya thanks

[steven1976]

Was pretty rough yesterday. They can't do that sort of thing forever though as obviously liquidity isn't always so poor and people will just work out what they're doing and will exploit it.

"Whipsawed" - nice (and accurate) description JR

What if they controlled the entire book like a bookies? Then as they take a bet on one horse they move the price on another horse to balance their exposure? Just a thought

[steven1976]

For me anyway, the main thing is BF have to stop this self matching crap. If i put 10K into a market behind 40 K at 3s and suddenly a 100K bomb comes in and it looks like 80K of matched bets have happened when really only my 10K has been opposed, the crowd jump in. Even if just the scalpers fill the gap behind between 2.9-3s they still know there get out point if its all their own false money that is matched. Then if they hold the money down chucking their own money backwards and forwards long enough to create a new price range.....

Quote in regards to stock trades
"Such transactions, known as wash trades, are banned by U.S. law because they can feed false information into the market and be used to manipulate prices. Intentionally taking both sides of a trade can minimize financial risk for the trading firm while potentially creating a false impression of higher volume in the market"

[hgodden]

Was pretty rough yesterday. They can't do that sort of thing forever though as obviously liquidity isn't always so poor and people will just work out what they're doing and will exploit it.

"Whipsawed" - nice (and accurate) description JR

What if they controlled the entire book like a bookies? Then as they take a bet on one horse they move the price on another horse to balance their exposure? Just a thought

They'd never be able to balance the entire book at the thin margins that exist on the exchanges (e.g. 2.04 to 2.06.) The overround that the bookies have are so much bigger, but even then the bookies are taking on high amounts of liability at times.

[Euler]

Lets start a new thread for this topic so it can be discussed in full.

FWIW if we are able to spot some prevailing activity, I'm happy to try and capture it and publish information for us to examine.

[steven1976]

Never say never hgodden! What if it was only me and you in the entire market. No one else enters,.just me and you. You have a million and I have a grand. Would you still say you couldn't balance your book? I know a bit extreme but I think the easiest way to break things down.