London Marathon Odds

Betfair allows one to layoff bets. Notice that even when comparing the layoff to the best back there is no arb available (of course.)

http://odds.bestbetting.com/athletics/london-marathon/mens-winner/exchanges

Ventolin - thats what I thought. If you couldn't take both sides, then the bookie would hold all the risk, and there would be regualr blow ups w/ late bets

Malmo - thanx. Makes it clearer w/ a real example.

Having slept on it, I realized this is the "parimutuel vs fixed-odds" betting system question.

Parimutuel - all bets are pooled and odds are set at the gun. The opportunity here is when there is heavy betting on the favorite to win, relative to show and place pools, then payoffs for show and place pools can exceed win payouts, if the favorite wins.

Fixed odds/bookie - there are no behavioral distortions as with parimutuel betting, and you get fixed odds at the time of betting, but you CAN distort the odds if you are a large bettor by witholding your bet until the last minute. This is a risk the bookie runs.

Off the Grid wrote:

Ventolin - thats what I thought. If you couldn't take both sides, then the bookie would hold all the risk, and there would be regualr blow ups w/ late bets

Malmo - thanx. Makes it clearer w/ a real example.

You're welcome. With all of this bookmaking talk, I just ordered a hefty book from Amazon -- "The Economics of Gambling." Hopefully it will sort out some answers to the day-to-day mechanics of bookmaking.

i shouda followed that guy & layed lefty !

he imploded & is now upto ~78/1

he's made himself $960 if lefty loses & guy does nothing about his position

or coud hedge if he feels lefty performs a miracle & wins by betting $63 @ 78./1 : "closing" the position & realising net of

960 - 63 = $897

Another good book (i think) is "The Theory of Gambling and Statistical Logic". It deals w/ making odds with information lags (the bookie and late bets), and other games w/ more moving parts.

A good description of the parimutuel overconfidence phenomenon is "Dr. Z's 'Beat the Racetrack'". A long tome +700 pages, and it could really be summed up in 5 pages, but it gives good examples of how to capitalize on parimutuel pools' anomalies.

Off the Grid wrote:

Another good book (i think) is "The Theory of Gambling and Statistical Logic".

I already have it.

just to clear up the "fixed odds" dilemma

they aren't fixed depending on amount of bet

i read a story a coupla years ago in racing post ( bible of betting in gb ) :

http://www.racingpost.co.uk/news/splash.sd

( i used to read the paper in bookies near my work - it covers all sports )

tiger was 2/1 for british open ( on the tuesday before ) & bookies had no problem taking small bets in $10 - 20 range at these odds ( unless obviously, they got a few thousand of them in a short period of time ! ), but were told to contact hq if bets above $2k were proffered

one punter came in & wanted to put $50k on him for the win

the tiller had to phone hq & a few minutes later, the reply given was that they woud take the bet, but obviously not offer him 2/1

the offer iirc was either 15/8 or 7/4

punter took it, knowing he wasn't likely to get 2/1 with this sum being bet

with tiger betting, it all became a laugh every time a major was on - reading the paper, it used to be which bookie was last one left standing offering 2/1 before they caved in & pulled it into 15/8 or 7/4 ( remember, a lot of bets were just "each way", something like 1/4 odds for top 4 finish - bet $50k just each-way at 1/4 of 2/1 = 1/2 odds for top 4 finish & you get win of $25k ( + stake returned ) if he finished in top 4 - which he usually did

punters bet on him knowing his consistency - win is tough to happen, but he usually comes close & top 4 is likely - bookies have taken a lot of bashing from him from each-way bets

Thats what I thought. If you have size, just like in any market, it pays to to trade late.

actually, it pays to trade early !

last year you might have been lucky in golf betting to get some bookie offering him at 5/2 a week or 2 before - ladbrokes loves to take him on - wonderful story before '05 pga at medinah : they said :

" medinah is a long, long course & he won't be able to hide his driver out there like he did at hoylake ( he used driver once in 72 holes there ) & just "2-iron" it around - he's going to have to use driver & because of it we're taking him on - we're offering 2/1 & we're not going to lay-him "

money flooded in & they had to make a humiliating retraction & cut him to 7/4 at the off ( in the end, he won & still hardly used the driver ! he "3-wooded" it around !!!

now if you did come in with $50k a coupla weeks before, you might get offered 2/1 - 9/4, rather than a day or 2 before when he's quoted at 2/1 & then get offered 15/8

anyhows main point is the "each-way" bet - that's the reason he gets quoted at a ridiculous evens nowdays - the heavy-hitters have made a killing on him past 2y with the big each-way bets

start of '05, after 2 lean years without a major he was offered at 5/1 ( nearer the "correct" odds for any favorite in a major - even nicklaus in his pomp was not quoted shorter than 5/1 starting a major - majors are so hard to win with everyone so motivated for a career changing win ( much more than a regular tourney ) that 5/1 shoud be nearer actual probability of winning - but incredible consistency ( not the wins ) have slashed his odds due to heavy each-way betting

iirc he has finished in top 4 of majors 6 - 7 times out of 9 since start '05 & these heavy hitters putting on $50k for 1/4 odds of initially 5/1 ( = 5/4 ), 4/1 ( = evens ), 3/1 ( = 3/4 ) have made a killing 6 or 7 times out of 9 - that's about as close to "money in the bank" as you'll ever get in sports betting

result is, because of this consistency he's down to evens, which as stated, is ridiculous

it won't change for next 2 majors, as at USOpen at torrey pines ( he's won past 2 or 3y on the course ) & for british open at birkdale, he was 1 shot from a play-off when a mere pup 10y ago ( he got blown about in a hurricane in 3rd round when almost leading/leading for ~ 77, but came back in final round with a 65 to finish 1 shy )

he loves those 2 venues & it's virtually certain he'll get into top-4 & that's why the bookies will have to keep evens for him

Now that everybody knows the trade, you have to trade early.

When you have no informational edge except a large bet, THEN it pays to trade late. When the odds reflect the majority of "votes" and bookies views, your size can influence your payout, all else being equal.

i fail to see your logic in betting late if you are likely to get worse odds near the off ?

obviously it doesn't always work like that & a favorite may ease from 1 or 2 weeks out to right before an event, but in something like golf, nothing much changes 1/52 before an event 'til day of event & favorite tends to shorten progressively as increasing amounts accumulate on him compared to other competitors

in horse-racing you do often go the other way - but that's often due to "new info" : usually in the paddock if the favorite is seen to be excessively sweating or excessively frisky, then the big-bettors tend to start betting on 2nd or 3rd favorites as favorite may have been seen to have "already shot it's bolt" - in this case favorite eases ( but you may be foolish to bet on him )

in the end, it just comes down to finding the longest price from weeks out to the off - & that coud be anytime