Posts Tagged strategy
Murray Matrix
Posted by Peter Webb in Tennis on January 16th, 2012
Looking forward to seeing Andy Murray in action tonight.
Last night I bagged 25 decent winning trades from the overnight matches. I use Tennis Trader to work out key points in a match and what odds are likely to be traded around key points. By looking up these key points in advance I can set up a trade that will trigger at or around those points and offset to a value that will lock in a profit. All markets exhibit a ‘harmonic mean’ around which all volatility gravitates. Understanding that allows you to put trades inside this envelope of volatility and get a decent trade away automatically. I’ll be doing the same again tonight and all the early round matches. I’ll be picking and choosing matches that I want to actively get involved in. Even if you mess around with the former strategy, you will learn a great deal about the market. I set up my trades early in the evening then turn them into keep bets to get matched when the game is underway. Doing this gets me to the front of the queue as well!
In the image you can see I am looking at a particular point in the market where Murray would trade and examing how many sets or games he would need be down / up to achieve that price. It’s possible to work out all combinations of scores and how they can be reached and pitch your trade at a common point by doing this.
Big over-reaction
Posted by Peter Webb in Tennis on January 5th, 2012
Sometimes I just want to roll Gael Monfils up in a bundle and kiss him.
One of my biggest ever wins came on a match with Monfils in it. He overstretched himself and called for the trainer. I had just backed his opponent and his priced rocketed in and netted me a very lucky big profit, so I greened up. After a brief spell with the trainer Monfils carried on and looked like he had never been trouble and went on to win the match.
It was at this point that I learnt Monfils tended to be a bit elaborate in his play, often plays in a way that could lead to potential injury and tends to make a meal of it. That paid off last night.
I was watching the Monfils vs Becker match at the Qatar open. Monfils collapsed on the ground and everybody laid. I rewound the sky+ put it in slow motion and you can see all he did was whack himself on the knee as he tried to play the shot. Quickly backed him at what ever price I could get and laid it off a few minutes later. He went on to win anyway.
You can see the massive over reaction on the graph. A decent, low risk trade.
Back to open
Posted by Peter Webb in Bet Angel, Betfair, Horse Racing on December 20th, 2011
It looks like we are going to have some fun and games in the market today. I’d recommend adopting a ‘back to open’ trading policy!
For more information read up on this thread: -
http://www.betangel.com/forum/viewtopic.php?f=5&t=4934&start=240
Winding down..
Posted by Peter Webb in Betfair on December 19th, 2011
We are well on the run in now for the Xmas break now and this are going to get a little quiter as the week rolls on. Quieter apart from at home because the kids are off school now! Racing comes to a close on Thursday and there is no racing on the Friday or Saturday.
Plenty of decent racing on the Saturday just gone and it proved a good days trading. Best result of a good bunch came from the last race at Ascot. I did well on both exchanges on Saturday but couldn’t beat this total on Betdaq, but obviously could after commission!
Bits and bobs around this week but my enthusiasm for it isn’t high, so I’ll be working on new things and cherry picking some opportunities. I can’t see the markets being that favourable this week, but you never know.
If you are not active this week or busy Christmas shopping, why not use some of the new automation functions to trade automatically. Only a lack of imagination can separate you now from doing or learning something new about the markets, with this recent addition to Bet Angel. Set it up at the start of the day, in practice mode if necessary, come back and read your automatically exported P&L report at the end of the day. Tweak strategy, then repeat. Great fun.
Give your football 150% this weekend
Posted by Peter Webb in Football / Soccer on December 17th, 2011
I love those throw away phrases where people say they are going to give it 150%. Of course you can only give it 100%, or can you? Not when trading.
In a betting market the market is framed at 100%. A football team can only win, lose or draw a match. There is a 100% chance of that happening. But when trading, you are trading how volatile those odds will be and that is always over 100%, whatever sport you trade. I cottoned onto this fact way back when I first started looking at stats and sport and quickly realised the significance when exchanges came along. But this fools a lot of people.
If you bet on a football match for example, over the long term the market is so efficient you will end up +/- nothing less commission (or other charges). But when you trade, depending on what you are doing, you are predicting an envelope of volatility. In football there are several match types that win whatever the underlying basic strategy, and these occur with quite regular frequency.
However, this ‘over 100%’ often fools people into thinking that they have stumbled across some great system. A lot of matches will end in profit simply because of this characteristic but, of course, you can only profit if you predict what is likely to happen than just because of this effect. It creates a high strike rate but that alone doesn’t create a profit.
So when you look at market when trading, you know you should, by default; look at giving it more than 100%!
Lay the draw – automatically
Posted by Peter Webb in Bet Angel, Football / Soccer on December 3rd, 2011
Last week we backed the draw using the new automation feature in Bet Angel, this week we lay it.
Whether you use the new feature to implement something or test an idea, it’s a powerful tool to do either. Based on immediate feedback we have expanded the number of conditions you can apply to your automation which expand your capability further. Bear in mind that using the practice mode you can play around without risking any money and by using the P&L export function in the automation, you can export your results to a file long after the market has closed. This will allow you to see how you did on the day when you return to your desk.
We plan to introduce even more elements to the automation, so please keep your version up to date with the very latest beta. Next release is on Monday.
Here is a video explaining how we laid the draw and greened out after a goal, using automation. I’ll export and post the automation file that did this on the forum.
http://www.betangel.tv/video/using-bet-angel/automation/220-automatically-lay-the-draw
Be careful laying the draw in certain Italian matches!
Bombs away
Posted by Peter Webb in Horse Racing on November 14th, 2011
Every now and again in the racing market an individual arrives that doesn’t make much sense. From a trading perspective at least!
The come into the market and back a selection for a large amount of money, then back again and again and again! I’m not sure the oft quoted description of ‘mad bomber’ is accurate, maybe there is a better description. But what is certain is the impact they have on the market. You could view this as a negative, but if you know the way they work then it’s a big positive.
If somebody is backing in large amounts repeatedly then you should seek a speculative open order on the back side first. If you are on another selection then you need to lay first. It could also be possible to catch a bounce when the price gets backed in heavily, but you never know how aggressive this individual is going to be, so I prefer catching the top.
Why they are doing it is another discussion altogether!
United vs City
Posted by Peter Webb in Bet Angel on October 23rd, 2011
One of the big matches of the season is up today, the Manchester Derby. I’m really intrigued.
This is the real acid test of who is going to be in the ascendancy over the season. Both have thrown down the gauntlet with very good early season performances and matching each other stride for stride so far. So this match is the first opportunity to throw both in the mix and see what comes out of the melting pot.
You have to feel there is a good chance of a draw. Either side will not want to lose and that will cause either side to really chase down a goal if they go behind. Local matches always throw up more draws than non local matches anyhow. I’d love to watch it but unfortunately I will be on a plane at kick off so I wont get to see it at all. I’ll have to fire up my laptop to view the highlights when I land.
Good luck if you are getting involved. You may be interested in taking up Betdaq’s offer of your commission back if either team come from behind to win. Click here to learn more about the offer. Just how often would this happen? On average the away team scores first 44% of the time. 32% of the time they will score first but not win, so it’s a definite possibility. But, Manchester City have only won once at Old Trafford since 1974 – a 2-1 victory for Sven-Goran Eriksson’s side in 2008. It’s going to be an interesting battle.
Click here to learn more about the offer
Mighty oaks from little acorns grow
Posted by Peter Webb in Bet Angel on October 5th, 2011
When my first daughter was born I planted an acorn. Since then it has grown to the proverbial Oak Tree. This year it is 14 years old and yielded its first crop of Acorns.
My point?
When I was in a ‘normal’ job I was always planting metaphoric acorns. My hope was that some would grow to Oaks, and so they did. So I suggest you always keep planting Acorns. Not just in the context of building for the long term future, but also in the short term context of looking for new ideas. Each day, week and month I am trying new things. Prodding and probing looking for any new information I can find. Interestingly, a lot of the time, I discover stuff completely by accident while looking for other things.
One of the reasons we have multi market tools and spreadsheet integration in Bet Angel is because this allows you to experiment and test many markets while you carry on doing something else. This is a really useful way to widen your capabilities and search for new opportunities. Once you come up with an idea you can test and expand it and see how far away from break even you are before you then start to think about ways to bridge the gap. You will immediately know when something has taken root and is likely to grow. From there it just needs a bit of tending.
I’ll aim to put an example of this up on the Academy site which you can view when we are ready to launch. To get an email for when the happens, sign up to the newsletter.
Keep planting those acorns!
Back to back
Posted by Peter Webb in Bet Angel on September 30th, 2011
That’s woken me up from my slumber!
A very simple strategy would have made you money trading the racing today. Get a back order filled and wait.
Somebody was in the market a lot today, as we have seen before, with seemingly infinitely deep pockets. Race after race has had one horse or another completely smashed up with huge back orders. When trading you don’t need to catch many of these to make a huge difference. I am sure a few of us got caught out early on, but when the pattern became obvious, race after race, it seemed a simple strategy to simply take some low risk backs and wait. At worst you should have just biased your trade to back first rather than lay and hope to catch one or two.
An interesting day!
Cheaters never prosper
Posted by Peter Webb in Bet Angel on September 24th, 2011
I saw this post on another blog recently and it shows up how statistics can actually reveal very little at all. This is obviously unintended in this case, but is a trap a lot of people fall into very often. Especially when gambling / trading.
http://www.soccerbythenumbers.com/2011/09/cheaters-never-prosper-connection.html
I first looked into the relationship with fouls and goals some time ago and the link is the attacking strength of one team over the defence of another. If your defence is under pressure then they are more likely to commit a foul. It’s as simple as that, there is little more to be read into things.
For some time I sought to understand how to price odds on a football match. This was the obvious key to finding value. Bit by bit I improved my forecasting skills to the nth degree. In that quest I discovered many things, but one of them was how a lot of stats that are proffered to the market are in fact completely useless in determining value.
If a team has scored two goals a match for ten matches in a row, then you may think this has some bearing on the next match. But ultimately it doesn’t. But that doesn’t stop every pundit and his son offering this as a useful stat. In fact the source of true odds actually lies much deeper in individual statistics and how you plug two disparate teams together. Sort that out and you have the key to successful forecasting.
Back the draw
Posted by Peter Webb in Bet Angel on August 27th, 2011
I’m going to put up some information on Saturday’s about football / soccer. Some of it may seem contradictory for some of you and some logical, but it’s all based on years worth of research and application in the market.
For starters: -
If you backed the draw, pretty much at random, last weekend; you would have have netted a cool profit. I know, because I did exactly that and suffered a 60% thumping as a result! I was doing some work on how diversification affects your net P&L if you are backing varying numbers of events and wanted to test something.
It drew me back to a spreadsheet I did in 2005 based around the efficiency of the market. I came up with a back the draw strategy that squeaked around a 1% margin on average out of the market. I brushed down the spreadsheet and updated it and had another look at the efficiency of the market.
I looked at 15935 recent matches and discounted the implied probability the market was giving on the draw. I then compared that to what happened. On average the market was only about 0.66% out. The chance of a draw occurring versus what the market offered at the time was pretty much spot on. It also highlighted that you could come up with some crazy system based on the draw and still end up with only a small slice of luck. A lot of filtered selections could still end up and fool you into thinking that you had discovered some edge. Check out a few e-books for some examples of this.
The main problem was not an edge though. I worked out, with a simplistic calculation, that using £10 stakes I would have lost £8686 to commission. If you imagine somebody staking in a sequential manner, their £10 per match turned into nearly -£9k. This also highlights the difference between commission on outright betting versus trading on the price movements. It is much more favourable for the latter.
If you think hard enough though, even with that commission paid is possible to overcome. It ‘only’ represents 3.9% of the total amount bet at the worst rate of 5%. Pay above 5% though and it becomes very hard indeed.
So there you have if. The market is still as efficient as ever, but this means you will need a fair chunk of data to ensure you have an edge. You will also need to ensure that edge is quite large to overcome commission. By trading you reduce some of the liability and that will help you overcome that 0.66%.
Another new strategy
Posted by Peter Webb in Bet Angel on August 4th, 2011
Sat the in bath the other night pondering a number of things. Of all the things I do, looking for new things and trying to solve the puzzles that any market throws at me is the thing I find most interesting.
I came up with a way off thought based upon what I had seen from recent market data. Basically that the market has been tightening and less money than ever is lost to one side of the book or the other.
It’s too early to judge whether I’ve found something new but I put it into practice this week and the results are encouraging. The graph is just from the first two days of operation. Typically I use a spreadsheet to run some simple tests to see if I am on the right track and from there I can refine what I find. Using spreadsheets with Bet Angel are a great way of testing a market or ideal with minimal effort. The market never seems still despite it’s age so always keep looking at new ideas.
I’ll keep you in touch with my progress, or lack of it! For some background behind that last sentence, read these posts from last year.
http://www.betangel.com/blog_wp/2010/10/07/death-of-a-strategy/
http://www.betangel.com/blog_wp/2010/03/13/the-birth-of-a-strategy/
Important Information
Posted by Peter Webb in Bet Angel on May 12th, 2011
Well day 3/6 on jinx week has passed without catastrophe. Yesterday wasn’t a great day by any means and I really fouled up on one race, but I’m still moving ahead on the week and hope for a better day today.
I’m always experimenting and there is no better way of doing that than directly in the market itself. I will always recommend this, as it’s the best way to really know what is really happening and how your actions shape the market. That’s important. You can back test and practice as much as you like but I can assure you actually doing it will always be different for one reason or another. This is why I recommend you get your hands dirty as quickly as you can.
I recently looked at a new strategy, gathered some data, tested it and then wrote a spreadsheet to put it to use. Spreadsheets are fantastic tools for trying out things with little effort. The end results can either confirm, confound or point you in a new direction. You can put some simple commands in and let Bet Angel do the rest throughout the day (or night) automatically. Some of the best ideas and understanding I have had, come from doing this. I was sure my new strategy would be net positive with a bit of tweaking. So I unleashed it on the market and promptly did my nuts, though my nuts were done in a very controlled manner. You may think that’s bad news, but for each negative on the exchange you will always find a positive.
I was a little perplexed, but not surprised, as it’s tricky to nail something on the first attempt. I carefully re-examined the data and checked my assumptions, they were OK. To eliminate confirmation bias, I handed the data to a third party and asked them to check it without telling them what they were looking for, that was OK. So, I had to dig around to learn what was different; eventually I found an answer.
In the data, I was measuring the strategy from a certain time forward; this time was variable. In the market I was using a fixed time. I had to do this as I wanted to carry on my ordinary activity while the spreadsheet pursued the new idea. It took a while to understand but the conclusion was inevitable, the time between the two fixed points contained important, predictive, information about the future of the market. This is something I hadn’t noticed before or had been quick to discount.
So, while one path is blocked, while heading down it I have noticed a gap in hedge I hadn’t spotted before. This leads to a new path and one I shall now enjoy exploring instead!
Losing it!
Posted by Peter Webb in Bet Angel on April 20th, 2011
A good example of key turning point in a Tennis match recently. Whether you consider the distraction a key point or the reaction to it, It dug under the mood and psyche of the player and triggered off a bad run in the match. Sometimes not all turning points are based on stats or interpretation of them. However, they do help frame your potential risk and reward and that’s why we created Tennis Trader.
http://sports.yahoo.com/tennis/
You can’t take account of injuries though, no matter how good your model; this is why we have the calibrate button in Tennis trader. If you want an insight as to how an injury or suspected injury can affect things and the way people play then listen to the following interview for some insight: -
Waves
Posted by Peter Webb in Bet Angel on March 31st, 2011
For some time I’ve noticed curious elements within betting markets. I love analysing and studying what happens in the market, and it’s all to find out that critical question, why?
Getting a deeper understanding is useful because it allows you to build a firm framework around your decisions. I’ve often seen people stumble on something that works and then come up with things to justify that. Eventually they will fail a little while later and slip out of existence, why? Finding success can gives you false belief that you ‘have it sussed’ when in fact just finding something that works could just be a fluke. Failing to examine the “why” question is a key error for a lot of people in any market. I saw this a lot in financial markets. Sometimes people think they know why but they are only just scratching the real reason.
I’m interested in why things fail, or specifically exactly why does something really work. Each year I modify my strategy in a constant game of cat and mouse as a result of my research. It could be just to improve what I have, or to respond to a change in the market. When I do that, no doubt somebody else responds to that change and so the game continues. If I stayed still I would also get pushed out of existance.
For some time I’ve been aware of a general ‘wave’ in the market that determines how favourable it is for certain strategies. The market ebbs and flows and when the wave is peaking, that is the time of greatest opportunity. I never really, truly, understood why until recently. With a clear head after my holiday, I set about solving something unrelated and too my surprise I realised that it mapped very well on top of the wave. Within a few hours I had finally worked out what generates this phenomenon. The unfortunate thing is I can’t influence it but at least I understand another new thing about the market.
Bump..
Posted by Peter Webb in Bet Angel on March 21st, 2011
Now Cheltenham is firmly behind us and the champions league football pauses for a few weeks, it’s time to come back to earth with a bump. On the racing front, the weeks before and after Cheltenham are often starkly different, so it’s time to dig deep and stay out of trouble.
I’ll be adopting a cautious approach in the coming week and not trying to push too hard to find an opportunity. Doing that gives you a tendency to look for something that doesn’t exist. That said, opportunities are apparent all the time, so don’t miss out on them, just be aware they will be fewer and less obvious. Last week some of the races in between Cheltenham presented some opportunities, so it’s wrong to assume last week was just about Cheltenham.
Anyhow, expect a different feel to this week and play defensive is my advice.
Safety in numbers…
Posted by Peter Webb in Bet Angel on March 5th, 2011
An overlooked strategy on betting exchanges is spreading your risk across a number of selections and / or markets. A lot of people think this involves more risk but I’d actually argue it involves less.
By doing more you increase your chance of a return and minimise the pain of a loss. This is strategy that can be applied in a number of ways but can most commonly be applied across, say, a number of football matches before the start. I will often group matches into batches where I will take a position on 3-5 matches in one go. I’ll be looking for a general characteristic that should deliver a payoff. If I am wrong I can exit one or more positions or cash in on others. You can see a simple example of how to do it here: -
If you pin your risk on one event, one loss could be significant to you and cause you a fair deal of emotional pain. This level of risk is also likely to force your hand. Spreading out the risk may reduce your immediate return, but, if you are following a net positive strategy, then increasing its scope shouldn’t worry you anyhow. In fact, it could get you to a more positive place in double quick time. This is because you will learn quicker and increase your scope in a defined and controlled manner.
I only ever aim to be right more often than I am wrong, I am playing a numbers game. Doing this by putting more through the market across more selections I have found aids me in this process. I’d recommend it.
Accidents and evolution (Part three)
Posted by Peter Webb in Bet Angel on February 24th, 2011
Never one for rhetoric; I presented a similar case, to those I have described in the prior posts, at a talk I did last year. Using a similar model we followed how that can evolve from a base set of criteria and environments to something more complex. The following two snap shots are from a control where we work at random and an evolved model a few generations on.
Here we are using £2 at random
Here we use an evolved model
I reckon I could replicate the performance of the two at an pre-determind date. But some of the performance will always be reliant on prevailing market conditions, but it’s the gap in performance that is the most interesting. The second benefits from picking the ‘right’ market, direction and exit models. It was only by studying why one performed better than the other that I was able to fully understand the reason and why that was important. You can then use than to hone other strategies.
Of course there an infinite amount of variables, so you need to point it in roughly the right direction. If you don’t know the direction, then do a binary chop to get there quicker. You also have the issue of course that the market can and will change. We recently saw the introduction of cross matching across many sports and that has changed the ‘environment’ to the point where I am sure some strategies have started to fail. This in turn will alter the behaviour of those people who are trying to avoid becoming dinosaurs. Sometimes however accidents in evolution produce strange results. On more than one occasion I’ve made an error on a spreadsheet and it has failed to do something I wanted. That in turn though created some unusual payoffs which lead me down paths I hadn’t considered exploring. Just another path on the road of evolution.
So while using a genetic algorithm is a useful trick, evolving doesn’t stop, it continues ad infinitum. If you stop evolving you may appear in the betting exchange equivalent of the natural history museum in a few years time.
Accidents and evolution (Part two)
Posted by Peter Webb in Bet Angel on February 23rd, 2011
So how did my view on evolution, natural selection and Darwin translate into market strategy?
There are many ways to apply it, but first you need to start. Your first strategy is to have no strategy, just poke around at random. This gives you a control sample to work with, a base metric from which you can build your activity. You should regularly revisit your control to ensure the base you are working from is still the same as when you started.
Next you need to decide the environmental factors. In the case of the market, when do you open a position, when do you close and what do you use to judge that? Could it be the market type, the price, the time? You could have a number of factors that tell you if a market is ‘right’ or is adequate for your participation, these define the environment in which you will work.
Next you need to decide exactly what your entry and exit points are. Start simple and build out from there. It will be fairly obvious, fairly quickly where things are not working and you can ‘kill’ off these experiments. After each life cycle of experiments carry forward the successful ones and add in some new variations for the next generation. It’s surprising how quickly you ended up with a much better understanding and a much better strategy. It’s not just the entry and exit that are variables the environment is also, don’t forget that.
It would be nice to say ‘That’s it’s’ but that is rarely the case. You have to remember that the market itself evolves and people in the market occupy certain niches. You need to find a niche but also compete with people who may already be present in that niche. Your activity in the market will also shape the environment, so that in itself produces a response from the environment. One failure of market participants is to fail to evole a strategy, every strategy has its moment but many people find, often by accident, something that works; from that point it starts slipping away. The general reason is that your activity has probably forced others to evole and so the whole things rolls on again but also a lot of participant never work out why what they did works. I am always restless for understanding.
More reading: -
Accidents and evolution (Part one)
Posted by Peter Webb in Bet Angel on February 22nd, 2011
Some time ago, when I was young, I was accosted by somebody on the streets of Guildford. He was trying to challenge my view of the world and get me to sign up to their cult or something. He followed me down the street and asked me if I really believed the world, everything we see, was created by accident. Without hesitation I replied, YES!
When I was young I had asked myself the same question. So I went to the library and started to read up on the theory of evolution to try and understand if there was some simple scientific logic at how you could arrive at something so complex from something so simple. I found my answers and wrote some simple code to see them in action. The code basically started with something white and introduced some Darwinian variables such as mutation and predation and I studied how it turned from white to black over several generations. I change the environment to test how that affected the evolution.
To this day I use these principles when working through a system, process or problem. Evolution does, eventually, provide a solution even if you don’t have a clue when you start out. Have a look at what you are doing and see if these principles can apply to what you are trying to achieve. People often talk about neural nets in trying to find an edge in the markets, but I have found a bit of Darwin a much more viable and logical solution.
Good start to Tennis season
Posted by Peter Webb in Bet Angel on January 6th, 2011
In preparation for the Aussie open Tennis later this month I have been warming up on the Qatar open this week.
Best of three tournaments mean that the swings you can get can be very large and quick. If a heavy odds on favourite slips up or stutters, the response in the market will often be significant.
One of my favourite tactics, that I detailed here, is to lay a very short priced favourite in the hope that they slip up and the price starts to move out. This happened twice yesterday when very short odds on Federer and Nadal caused their price to jump out in response to some lacklustre displays. Nadal imploded at one point to lose a set 6-0, the first time in a couple of years. At least he has a fever to blame.
Of course laying at short odds willy nilly will not produce a profit in the long term. So I use Tennis trader, before the match has started, to work out what score will cause the odds to move and I nip in ahead of this potential. This allows me to maximise the upside while minimising the potential for loss. If it looks like it will not come off, I simply scratch the position or take a small loss. Because the odds are so short you can quite easily scratch when money buyers come in at very short odds to snap up ‘value’.
It’s been a good start, lets hope it continues.
Underrated strategy
Posted by Peter Webb in Bet Angel on August 27th, 2010
I covered the ‘lay the field’ strategy in some depth in racing ahead magazine a couple of months or so ago, it’s an easy strategy that works well and has been popular amongst exchange users for years. On Bet Angel you just need to set the odds, a value and click to lay the field.
To make it work, all you need to do is look for a market with a great deal of uncertainty about it. One market that was well qualified recently to fulfil this criteria was the Aston Villa next manager market. In fact most next manager markets exhibit similar characteristics and you can profit if you lay the field early on in these markets. A competitive handicap in racing over a short distance can also be fun!
Currently in the Aston Villa next manager market, these are the lowest traded odds: -
Bob Bradley – 1.43
Sven GE – 2.00
Kevin MacDonland – 2.32
Martin Jol – 5.00
Gareth Southgate – 6.00
Laying the field at less than 3.00′s would have been a viable strategy here and it’s possible that others may still come into contention.
A worthwhile strategy in your armoury.