This is a general trading question rather than a specific Betangel question so my apologies in advance if I have posted in the wrong spot.
I was reading an article today on "Sports Trading Life" where it reviewed the Man Utd v Newcastle game on the weekend. It talks about how Man U were at about 1.8 and Newcastle were at around 7 and the smart thing to do was to lay the favourite.
What am I missing here, why would you lay the favourite as opposed to back the outsider? Is it just to reduce the risk?
What am I missing???
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Online Trader
- Posts: 211
- Joined: Wed Apr 21, 2010 7:13 am
Laying the favourite gives you the draw as well as the win so if the favourite fails to win the game you win.
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maycontainnuts
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FYI, Not sure I would trust much on that site having look of the ebooks they are pushing and the way they are doing it. Hate all the hard sell stuff.
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JollyGreen
- Posts: 2047
- Joined: Sat Mar 21, 2009 10:06 am
The other thing to remember is the liability involved. If you lay at 1.8 then you lose 80% of your stake IF the favourite goes onto win. Now that is assuming you would allow the event to reach a conclusion. If you trade it correctly then your liability will not be the full amount although I often enter these markets with an amount I am willing to lose. So if Man United scored within 5 minutes I tend to accept I was wrong rather than trying to take another position which would increase my liability whilst reducing my potential profit.
I could trade out at the new low but that would merely reduce my loss and offer no potential upside. If the other team equalise then I am back to at least my original position possibly better off dependant on timing of the goals.
If as in this game the underdog scores then I am able to use my position to guarantee a profit. I could for example lay the underdog now dependant on prices and time left. An equalising goal would increase my profit but my risk would have decreased as you can manipulate your stakes to suit.
It goes back to the old adage. You must enter a trade with a plan in mind and you must be prepared to lose at times. Football is different to pre-race Horse markets as the movement is driven by action like shots on target, goals, red cards etc. In pre-race it is purely opinion so you often have multiple chances to change your position to generate a profit.
I could trade out at the new low but that would merely reduce my loss and offer no potential upside. If the other team equalise then I am back to at least my original position possibly better off dependant on timing of the goals.
If as in this game the underdog scores then I am able to use my position to guarantee a profit. I could for example lay the underdog now dependant on prices and time left. An equalising goal would increase my profit but my risk would have decreased as you can manipulate your stakes to suit.
It goes back to the old adage. You must enter a trade with a plan in mind and you must be prepared to lose at times. Football is different to pre-race Horse markets as the movement is driven by action like shots on target, goals, red cards etc. In pre-race it is purely opinion so you often have multiple chances to change your position to generate a profit.
Why in sports with two selections where a draw is not possible (tennis, snooker, darts spring to mind)do the exchanges give the choice of both selections to back or lay.
Surely in these sports backing the favourite is just the same as laying the outsider and vice versa. I know that the prices will be inversely poportional to each other but surely it would be simpler to offer just one selection to back or lay?
Surely in these sports backing the favourite is just the same as laying the outsider and vice versa. I know that the prices will be inversely poportional to each other but surely it would be simpler to offer just one selection to back or lay?
Two things:BJGardner wrote:Why in sports with two selections where a draw is not possible (tennis, snooker, darts spring to mind)do the exchanges give the choice of both selections to back or lay.
Surely in these sports backing the favourite is just the same as laying the outsider and vice versa. I know that the prices will be inversely poportional to each other but surely it would be simpler to offer just one selection to back or lay?
- all markets aint perfect. just because the fave is at 1.1 doesn't mean the unfavoured lays have drifted to 10.0 yet. Means opportunities.
- totally logical for exchanges to offer back and lay prices on binary outcomes. eg, if traders have strategies that lay both A and B under 2.0, this is impossible if you only have a book on one side
I'm a fan of A B markets. Very predictable.