Reduction Factors

[Grinderman]

In the 13.53 Southwell today, after the 2nd fav was scratched with a reduction factor of 41.3%, I look at my matched bets and I see I have some at 1.01. How can this be? I must have been trading at around 1.02, 1.03 pre non-runner and I certainly wasn't.

[Derek27]

In the 13.53 Southwell today, after the 2nd fav was scratched with a reduction factor of 41.3%, I look at my matched bets and I see I have some at 1.01. How can this be? I must have been trading at around 1.02, 1.03 pre non-runner and I certainly wasn't.

Non-runners can sometimes distort a market when prices have substantially changed. If, for example, you trade a horse at 10 and it gets backed down to 2, it's RF can change from 10% to 50%, resulting in two non-runners taking out more than 100% of the book. Betfair will then reduce the price to a minimum of 1.01. It's very rare to happen.

[Andriy]

Even if you backed it at 1.72, that would take your price after reduction to 1.01 (1.72x0.587). For the win market, the reduction is to the absolute price; it's for the place market that it's made on the differential above 1.0

[jamesedwards]

There is no reduction factor in-play, even if the horse is not removed from the market until after the race is run. Were your 1.01 trades matched in-play?

[jamesedwards]

Even if you backed it at 1.72, that would take your price after reduction to 1.01 (1.72x0.587). For the win market, the reduction is to the absolute price; it's for the place market that it's made on the differential above 1.0

You subtract the 1.0 before calculating a reduction factor. eg at 1.72 a reduction factor of 41.3% would reduce your odds to 1.42.

[Andriy]

No, that's only for place markets.

Consider a 3 horse race, all price 3.0 (2/1), with reduction factor 33.3%. If one horse is withdrawn both horses are clearly 2.0 (Evens).

If you subtract 1, you find that the price of either horse is: (3-1)x0.66 =1.32

If you use absolute price, not subtracting 1, you get 3x0.66=2.0 (which is the logically correct outcome)

[jamesedwards]

No, that's only for place markets.

Consider a 3 horse race, all price 3.0 (2/1), with reduction factor 33.3%. If one horse is withdrawn both horses are clearly 2.0 (Evens).

If you subtract 1, you find that the price of either horse is: (3-1)x0.66 =1.32

If you use absolute price, not subtracting 1, you get 3x0.66=2.0 (which is the logically correct outcome)

Yes, sorry. My mistake.

[Andriy]

Backing short priced horses early morning can be a kick in the teeth... you think you've got good value... until a horse comes out: favours the layers.

Conversely backing big priced horses favours the backers, particularly if the ground is potentially a bit iffy and you think there may be withdrawals (as at Southwell today, where offically good, but a few trainers may not fancy it after the frost).

[ANGELS15]

Backing short priced horses early morning can be a kick in the teeth... you think you've got good value... until a horse comes out: favours the layers.

Conversely backing big priced horses favours the backers, particularly if the ground is potentially a bit iffy and you think there may be withdrawals (as at Southwell today, where offically good, but a few trainers may not fancy it after the frost).

Betfair also apply RF to your whole return including your stake unlike bookies who only apply it to the profit.