The more I think about the markets, the more I realise how little is knowable about them...
Jeff
mugsgame wrote: Fooking hell Jeff you have cracked it!!!!!!!
Manipulation - Self Matching - What do you see?
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Sunnyclimes
- Posts: 17
- Joined: Sun Nov 28, 2010 1:28 pm
Thank you Steven for your very well considered original post, as well as the very cogent responses to the various comments.
Having observed the markets and tested with minimal stakes I fully endorse your observations as to how the market moves or indeed is manipulated.
I also detect from the various responses that the question of manipulation is not generally disputed; but the responses fall into two opposing categories; is it fair or unfair?.
My personal view is that the manipulation that I have seen is unfair, but I fully understand the opposing view which is to say that all activity (whether fair or unfair) is part of the market and we should just deal with it.
This is what I am doing. I am dealing with it. I have studied various markets over the last 18 months or so and have spent my time devising strategies that will make me money. If I cannot make money in a very heavily manipulated market (taking account of my size of bank and tolerance to risk) I will not take a sizeable position, if at all. I will find other markets that suit my personal factors.
If I may give an analogy:
Where do you draw the line between an athlete taking protein shakes and energy drinks (fair?) or those who have the medical facilities available to them to take EPO or blood transfusions (unfair?). My personal set of values will answer this question very quickly. However there are others whose values do not match my own - this does not make me right and the others wrong, it just means we are different.
To summarise:
You have done me personally, and I suspect a lot of other people, a big service by drawing attention to this issue, so that hopefully others will not fall into the pitfalls you have described.
However, other than drawing attention to it and highlighting the problem I am not sure what we can do other than 'deal' with it in a way that suits our own approach to trading.
Many thanks
Steve
Having observed the markets and tested with minimal stakes I fully endorse your observations as to how the market moves or indeed is manipulated.
I also detect from the various responses that the question of manipulation is not generally disputed; but the responses fall into two opposing categories; is it fair or unfair?.
My personal view is that the manipulation that I have seen is unfair, but I fully understand the opposing view which is to say that all activity (whether fair or unfair) is part of the market and we should just deal with it.
This is what I am doing. I am dealing with it. I have studied various markets over the last 18 months or so and have spent my time devising strategies that will make me money. If I cannot make money in a very heavily manipulated market (taking account of my size of bank and tolerance to risk) I will not take a sizeable position, if at all. I will find other markets that suit my personal factors.
If I may give an analogy:
Where do you draw the line between an athlete taking protein shakes and energy drinks (fair?) or those who have the medical facilities available to them to take EPO or blood transfusions (unfair?). My personal set of values will answer this question very quickly. However there are others whose values do not match my own - this does not make me right and the others wrong, it just means we are different.
To summarise:
You have done me personally, and I suspect a lot of other people, a big service by drawing attention to this issue, so that hopefully others will not fall into the pitfalls you have described.
However, other than drawing attention to it and highlighting the problem I am not sure what we can do other than 'deal' with it in a way that suits our own approach to trading.
Many thanks
Steve
Manipulation isn't new and has been discussed a lot before. But be very careful not to fall for the trap of thinking that the market is stacked against you because somebody is doing it deliberately. It's really easy to think that at times, but you will never make significant progress if you believe this. Sometimes psychology can make you interpret something is happen when it isn't. It can feel like every time you lay the market steams in and vice versa but if you take a step back and look at things you often see it's just your mind playing tricks.
That said, it's obvious that manipulation takes place and has done for some time. I've never been a fan of things that distort the market deliberately to make money. I've always seen it as a way of taking money out of the market in a way that is -ve vs. people who use skill, judgement and research to just be better than others. That I view as a +ve contribution to the market. I know some people view trading as a -ve aspect of the betting market but it has brought significant benefits to backers and layers. So I will happily argue the +ve benefits any day. We keep lots of data and because we are active in the market all the time we have the ability to look closely at many different things, so if you anybody ever identifies or sees some unusual we can probably hunt that activity down.
My main problem with manipulation is where does the manipulator draw then line? How far do they go? You see in many markets, LIBOR for example, where a little white lie eventually turns into a massive fraud. I've raised the issue of manipulation with Betfair but they don't seem too bothered.
I actually think that horse racing would be the hardest market to manipulate. Prices move rapidly and fill unevenly so I would think it's really hard to actively manipulate. You also have this problem that average unmatched bet volumes are quite small so it's easy to spot when somebody is trying to influence a price. I've taken this attitude that if I can work out where they are uneven I will oppose the money. So it's the classic case of turning a negative into a positive. When something is obvious I think you are at risk of your position being exploited and that's how I view manipulation.
I don't think self matching is a problem, not for me anyhow. I can't comment on how others use it. I don't really use traded volumes as a reference point when trading, so I struggle to see why somebody would seek to distort them. Also you have this issue of commission between accounts. You couldn't earn enough to cover commission if you self matched. Any commercial discussion I have had with Betfair has always revolved around how much money they will get, so I don't think it's feasible for them to waive commission payments. To my knowledge they don't for anybody. You also have this issue of market volumes. I can predict reasonable accurately, save underlying changes, how much money will be traded on races this afternoon, when and on which runners. That calculation hasn't really deviated much from historical data, so I see nothing unusual there TBH.
Finally, I think looking at other market participants is a bit of a game. That's how I view it anyway. When I approach the market I have half a mind on getting an order in based on my most favourable set ups but I also keep half my mind on what everybody else is doing. That is the market, and learning how it works gives you the keys to profitability.
The biggest threat in the market is probably Betfair itself. If you see how much has changed from the early days back in June 2000, you just can't rule out Betfair being the main determinants of our future and that's what occupies my thoughts most of the time.
That said, it's obvious that manipulation takes place and has done for some time. I've never been a fan of things that distort the market deliberately to make money. I've always seen it as a way of taking money out of the market in a way that is -ve vs. people who use skill, judgement and research to just be better than others. That I view as a +ve contribution to the market. I know some people view trading as a -ve aspect of the betting market but it has brought significant benefits to backers and layers. So I will happily argue the +ve benefits any day. We keep lots of data and because we are active in the market all the time we have the ability to look closely at many different things, so if you anybody ever identifies or sees some unusual we can probably hunt that activity down.
My main problem with manipulation is where does the manipulator draw then line? How far do they go? You see in many markets, LIBOR for example, where a little white lie eventually turns into a massive fraud. I've raised the issue of manipulation with Betfair but they don't seem too bothered.
I actually think that horse racing would be the hardest market to manipulate. Prices move rapidly and fill unevenly so I would think it's really hard to actively manipulate. You also have this problem that average unmatched bet volumes are quite small so it's easy to spot when somebody is trying to influence a price. I've taken this attitude that if I can work out where they are uneven I will oppose the money. So it's the classic case of turning a negative into a positive. When something is obvious I think you are at risk of your position being exploited and that's how I view manipulation.
I don't think self matching is a problem, not for me anyhow. I can't comment on how others use it. I don't really use traded volumes as a reference point when trading, so I struggle to see why somebody would seek to distort them. Also you have this issue of commission between accounts. You couldn't earn enough to cover commission if you self matched. Any commercial discussion I have had with Betfair has always revolved around how much money they will get, so I don't think it's feasible for them to waive commission payments. To my knowledge they don't for anybody. You also have this issue of market volumes. I can predict reasonable accurately, save underlying changes, how much money will be traded on races this afternoon, when and on which runners. That calculation hasn't really deviated much from historical data, so I see nothing unusual there TBH.
Finally, I think looking at other market participants is a bit of a game. That's how I view it anyway. When I approach the market I have half a mind on getting an order in based on my most favourable set ups but I also keep half my mind on what everybody else is doing. That is the market, and learning how it works gives you the keys to profitability.
The biggest threat in the market is probably Betfair itself. If you see how much has changed from the early days back in June 2000, you just can't rule out Betfair being the main determinants of our future and that's what occupies my thoughts most of the time.
Well said E thats what i think people pick up BA and expect it to turn them into miloners over night. i really do not let manipulation of the market bother me at all infact i try to read what the minipulators are doing when they are present and ride on their band wagon for a decent profit. you are correct if you let it worry you you will never move forward, trading is a long journey you find out many things like i did two days ago within the software as you go along.Euler wrote:Manipulation isn't new and has been discussed a lot before. But be very careful not to fall for the trap of thinking that the market is stacked against you because somebody is doing it deliberately. It's really easy to think that at times, but you will never make significant progress if you believe this. Sometimes psychology can make you interpret something is happen when it isn't. It can feel like every time you lay the market steams in and vice versa but if you take a step back and look at things you often see it's just your mind playing tricks.
Well said E thats what i think people pick up BA and expect it to turn them into millioners over night. i really do not let manipulation of the market bother me at all infact i try to read what the minipulators are doing when they are present and ride on their band wagon for a decent profit. you are correct if you let it worry you you will never move forward, trading is a long journey you find out many things like i did two days ago within the software as you go along.Euler wrote:Manipulation isn't new and has been discussed a lot before. But be very careful not to fall for the trap of thinking that the market is stacked against you because somebody is doing it deliberately. It's really easy to think that at times, but you will never make significant progress if you believe this. Sometimes psychology can make you interpret something is happen when it isn't. It can feel like every time you lay the market steams in and vice versa but if you take a step back and look at things you often see it's just your mind playing tricks.
Would you say that Betfair poses as much of an opportunity as a threat, inasmuch as them creating a 'trader unfriendly' environment could bring about an exodus to Betdaq that would transform Betdaq's liquidity situation?
Jeff
Jeff
Euler wrote: The biggest threat in the market is probably Betfair itself. If you see how much has changed from the early days back in June 2000, you just can't rule out Betfair being the main determinants of our future and that's what occupies my thoughts most of the time.
Just re-read this. I almost never trade that far out. Because of the volume I use I'm limited to the period near the off when most of the money is in the market. So my experiance is limited to that. I think it would probably be pretty dangerous to trade that far out, but I don't really try as the fill rate is so poor.I have made the example around 10s because this is a price you wouldn’t expect to see great amounts of money being matched 25 mins out and the market going crazy over a few 10 pound positions around the front of the queue so it’s easier to spot.
I know this thread has been quiet for quite some time but it reminded me of a situation that occured a few years ago when I was making decent money.
While I would wait for the proper money to come into a market I used to muck about making a few quid on the horses around 5.0 to 8.0 mark by manipulating the market. Basically, I'd get some money matched at my price and then use £1k to nudge the price a few ticks and voila! Standard stuff.
Until one day, when a punter obviously thought my £1k at 6.0 was great lay value on that horse and whoops, there it goes with the odds flying out! I was forced to trade out for a decent loss and decided I couldn't be bothered using that strategy after that.
I have never kept any stats so couldn't say whether it was a profitable strategy with or without the giant whoopsy!
While I would wait for the proper money to come into a market I used to muck about making a few quid on the horses around 5.0 to 8.0 mark by manipulating the market. Basically, I'd get some money matched at my price and then use £1k to nudge the price a few ticks and voila! Standard stuff.
Until one day, when a punter obviously thought my £1k at 6.0 was great lay value on that horse and whoops, there it goes with the odds flying out! I was forced to trade out for a decent loss and decided I couldn't be bothered using that strategy after that.
I have never kept any stats so couldn't say whether it was a profitable strategy with or without the giant whoopsy!
Chepstow 14:50 (14:48:07) all of a sudden lots of big bets started to come in the market and get matched at once (pay attention to yellow traded volume @ 2.56 & 2.58). without moving market too much. looks very much like self-matching.
https://www.youtube.com/watch?v=MHXbcCQMa4g
https://www.youtube.com/watch?v=MHXbcCQMa4g
Is self matching not against betfair rules or am i wrong?gutuami wrote:Chepstow 14:50 (14:48:07) all of a sudden lots of big bets started to come in the market and get matched at once (pay attention to yellow traded volume @ 2.56 & 2.58). without moving market too much. looks very much like self-matching.
https://www.youtube.com/watch?v=MHXbcCQMa4g
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giulio2010
- Posts: 962
- Joined: Sun Sep 12, 2010 9:11 am
Amazing staff...fast and precise!! 
well done to whoever did that..
well done to whoever did that..
so far spoofing, self-matching, pushing price are all forms of manipulation thus a parasitic activity. It exists at different extent in any market. It seems that betfair doesn't bother about it. I'm just trying to understand. Why would somebody do that? What for? I posted another video on usa markets. In a split of a second 2.18 became weighted price with 5k matched. https://www.youtube.com/watch?v=OZ4wZqlu-Fcmarko236 wrote:Is self matching not against betfair rules or am i wrong?gutuami wrote:Chepstow 14:50 (14:48:07) all of a sudden lots of big bets started to come in the market and get matched at once (pay attention to yellow traded volume @ 2.56 & 2.58). without moving market too much. looks very much like self-matching.
https://www.youtube.com/watch?v=MHXbcCQMa4g
Does that influence the formation of starting prices?
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steven1976
- Posts: 1744
- Joined: Tue Jan 19, 2010 6:28 am
I guess a split second could force some people to change their mind or long enough for someone else to jump in front of the big money whilst scaring away other money. If its not sold out then they could build a new price point to sell off a position by shaping the market to look like its heading only one way.
I think it is against bf rules but them rules are probably for regular customers. If its not themselves which I believe there is a good chance it is, then it could offer favorable terms to some customers. They once offered to me for offering to provide liquidity in Asian handicaps. I was just curious as to whether they allow it at the time.
In some markets (not horses), I find you can use it to your favor if you stack up a number of positions so that your next position allows you a quick exit if they decide to take on your 2nd, 3rd, 4th positions without getting stuck behind a big amount for 15 mins to sell off your exposure.
I think it is against bf rules but them rules are probably for regular customers. If its not themselves which I believe there is a good chance it is, then it could offer favorable terms to some customers. They once offered to me for offering to provide liquidity in Asian handicaps. I was just curious as to whether they allow it at the time.
In some markets (not horses), I find you can use it to your favor if you stack up a number of positions so that your next position allows you a quick exit if they decide to take on your 2nd, 3rd, 4th positions without getting stuck behind a big amount for 15 mins to sell off your exposure.
Spoofing and self matching are both horses from the same stable; designed to confuse and manipulate, whatever the particular rationale in each particular case might be. I'm entirely unconvinced that they achieve either goal.
I'm not often involved pre-race nowadays, but what I have seen most noticeably over the last few days is very consistent. Huge amounts will appear in line with the prevailing short term momentum, but when the price action 'threatens' their price (whoever THEY are), these large amounts, typically £2.5k-£5k, suddenly disappear from view, unmatched. It's so obvious, and the impact so limited, that it looks like some sort of standing joke. If you 'tickle' their price with a few quid, they'll run away like the cowards all bullies are. In fact, they'll more often run away a second or two before they're physically threatened. I've seen 7 year old playground bullies manage better than that!
However, I feel that matched volume carries more significance; indeed, I've noticed that 2 of Euler's wins on the 'motivational' thread appeared to be initiated alongside a large volume spike. It's remarkable how often big swings in a horse's price follow immediately or soon after a significant spike in volume. But I don't see how self-matching fits into the picture, other than to give other traders a clear signal to pay very close attention to the situation, and then act accordingly.
It's likely that spoofing and self-matching happen, but there is no way they fool any but the least experienced or most incompetent trader.
I'm not often involved pre-race nowadays, but what I have seen most noticeably over the last few days is very consistent. Huge amounts will appear in line with the prevailing short term momentum, but when the price action 'threatens' their price (whoever THEY are), these large amounts, typically £2.5k-£5k, suddenly disappear from view, unmatched. It's so obvious, and the impact so limited, that it looks like some sort of standing joke. If you 'tickle' their price with a few quid, they'll run away like the cowards all bullies are. In fact, they'll more often run away a second or two before they're physically threatened. I've seen 7 year old playground bullies manage better than that!
However, I feel that matched volume carries more significance; indeed, I've noticed that 2 of Euler's wins on the 'motivational' thread appeared to be initiated alongside a large volume spike. It's remarkable how often big swings in a horse's price follow immediately or soon after a significant spike in volume. But I don't see how self-matching fits into the picture, other than to give other traders a clear signal to pay very close attention to the situation, and then act accordingly.
It's likely that spoofing and self-matching happen, but there is no way they fool any but the least experienced or most incompetent trader.