interpreting the overround for an indication of where the market is heading..

[Ambettor]

Hi all
Quick question: I think i understand what the overround represents (bookies vig) what i dont understand is that i keep reading that the overround is always searching for 100%?? - balanced market? So how does the overround help novice traders understand a particular market, how can it be interpreted for an advantage if eg: there is >10 runners in any given market?
Cheers

[Euler]

I've never really looked the overround as an indicator as it's merely the sum of all values in the market, so it's those values that you should focus on. I know some people have differing views, but that's always been mine.

[Derek27]

If you have a back overround of 100.15% and a lay overround of 91%, that tells you that the back overround is at it's very limits and a price has to go down before (or at the same time as) anything else goes out, but the lay overround has plenty of slack and it's possible that all the prices come in, and vice versa.

[Euler]

If you showed me that, I would say the market was very gappy.

[Derek27]

That would be very gappy, which you only find on early or low-liquidity markets but the overround indicates which side if any, all the slack is on.

[Derek27]

Talking of overrounds, the 00:05 at Presque Isle Downs had a lay overround of 109%. I was half expecting a horse to be taken out but it appears all 7 runners are off!!