An investment banker once told me: "If you have a minority paying for the majority, you aren't going to get a vote for change". So it is with gambling. A prime example of this is provided by the attitude of the vast majority of European betting firms to in-running markets.
From the perspective of the punter, in-running markets offer many benefits. All pre-match imponderables resolve themselves in front of your eyes in real-time and, additionally, the playing field is considerably levelled by the fact that the market makers are seeing pretty much the same visuals as the leisure traders. Obviously, the bookmakers incorporate advantages into this more meritocratic environment - live streaming of games on Betfair is delayed by up to thirty seconds, for example, and trading rooms have access to a multiplicity of camera angles to bestow the seeds of benefit. A further tilt to the bookies is that inside information relating to the match may remain hidden from leisure viewers until the explosive nature of such information explodes into reality via a penalty kick or a Michael Owen special. But, despite such provisos, the action is analysable to all.
Now, bookmakers despise meritocracy in the same manner that Shinawatra does financial probity. Prior to a game, the bookmakers and brokers have an informational advantage that is only replicated by top notch market analysts and insider traders. By the time kick off comes around, any layer worth their salt is aware of the corrupt mechanisms underpinning an event. But, in a world of fragmented cartelisation, the ownership of the outcomes of events is a battleground where the individual power lobbies fight for control of the match, the market and, ultimately, the profits. For this reason, all but the most psychopathic of the trading firms are forced into taking hedging positions in the period leading up to kick off UNLESS they have total control of the match in question. This bookmaker's dilemma influences their in-running strategy.
Trading in-running is more akin to a poker market than a football one. Trading must be undertaken at speed and bluff positions analysed intuitively using market memory and aspects of forensic psychology. The difference in strategy between the European and Asian firms is palpable. All of the Asian firms offer highly liquid real-time in-running markets with minimal margins that enable all traders to operate without the presence of industry-generated financial millstones. They also offer the choice of the 3-way fixed odds markets (home/away/draw) and the 2-way Asian handicap markets (buy/sell). The European firms, in contrast, do not allow any 2-way markets without prohibitive margins that are sometimes as high as ten times those offered in the Far East. This leaning towards a three runner race rather than a two runner event is indicative of the European layer's general attitude. The Europeans are pitiful in their in-running analysis - as Schecter said: "The more they watched, the less they knew". When bookmakers are not able to entirely corrupt an event, there are three fall-back strategies available to them. Firstly, they would choose to randomise the event as the horseracing industry does with the handicapping system that penalises historical good performance. Their second option is to nudge punters in the direction of financially inappropriate markets. For example, last night Dietrological had one of our rare losing positions - it was on the Lyon versus Rangers Champions League match. Pre-match, we were with Lyonnais but, by the interval, we were convinced that Rémy Vercoutre had been taking lessons from one Fabian Barthez - the Glaswegians had only three shots on target in the game and Rémy was conspicuous by his absence from the ball's proximity in each case. During the half time interval, we wished to hedge our position. In Europe, we were flummoxed by the bookmakers who only provided us with the option of trading either on the draw or backing Rangers. We had no view on the eventual outcome and merely wished to get off Lyon. The only manner that this hedge was able to be enacted was via a mixture of trading on the handicap markets in Asia and on the spread markets (despite their horrendous margins) in London. The third option utilised by bookmakers on events outside their control is to either refuse to price the event up in the first place or to refuse to pay out winnings based on an assessment that if you know something that they don't, you must be privy to inside information. The bookmakers have a highly bipolar relationship with inside information - in their hands, it is creative criminality to enhance returns to shareholders; in the hands of anybody else, it is a travesty of justice.
The liquidity of the in-running markets is massive - as much money is traded while the game is in motion as in the week leading up to the match. Aside from the incidence of an internally controlled event, the level playing field presents an opportunity for the most professional market participants to succeed to the detriment of the less skilled competitors. On the professional and profitable side, you have the top analysts and the Asian market makers; on the other side, you have the European bookmakers and the leisure punters. Unable to compete with the former, the European layers are forced to target mug money for their in-running bookmaking.
Dietrological utilise inside information, neural networks and our Unified Trading Model (UTM) to analyse events. Our pre-match portfolio is created incorporating each of these elements with inside information being responsible for approximately 50% of our stances, black box technologies 15% and the UTM 35%. We have developed in-house a specific neural net for live events which is currently of minimal value to our trading operation. This is outrageous. The European firms either refuse to offer the markets without scandalous margins or they refuse to allow professionals to trade - try ringing around Ladbrokes, Chandler, Paddy Power, Hills and the rest of them asking if they close winning accounts. Unless you are backed by muscle, Asia is an equally challenging environment. We use just one market maker in the Far East that we have developed a trusting relationship with over the years. This company is the exception that proves the rule that all Asian accounts are likely to be compromised by non-payment or a timely disappearance underground as they oscillate between different territories paying backhanders to the likes of Shinawatra so as to be able to bank their illicit gains. Earlier this year, leading Asian layer Pointbet ran off with the money of their clients and, several years ago, 3StarBet did the same only to continually reinvent itself anagrammatically as Bet3Star, StarBet3 and 3BetStar! All leisure punters must take care with any firm that seems to offer in-running Asian handicap markets without a prohibitive margin. A prime example of this is 10Bet. Despite their London address, 10Bet are based offshore and, similarly to Pointbet, they utilise a ghost address in Europe to disguise their geographical location. The only way to get your winnings and, indeed, any deposit back from these charlatans is to threaten legal action, a baseball bat or both!
So, what are we to do? We have created an amazing in-running black box trading model and, yet, there is not one publicly-available environment anywhere on the planet that allows a non-criminalised, financially meritocratic platform for trading our model.
In a final lunacy, our beloved government has brought to law The Gambling Act 2005, which has allowed the bookmakers access to the airwaves to promote their addictive but corrupt wares, but does absolutely nothing to protect punters. For instance, the current Ladbrokes advert which enables Ian Wright, Ally McCoist, Jimmy Hill, Chris Kamara and Lee Dixon to sell their collective souls for a dollar makes no mention of the fact that Ladbrokes (like all casinos and traditional bookmakers) do not allow winning accounts which effectively means that any visit to such an establishment (online or off) represents an acceptance of voluntary taxation to the private sector. Entertainingly, in the advert the lads discuss the merits of Liverpool, Chelsea and Newcastle winning the Premiership which creatively omits the only two teams that are likely to win the title. Such adverts depart a significant distance from the truth.
The government has proactively provided a foundation for an underworld, a cartel, a massive corruption, a reality with a particularly sinister template - depending upon where you stand, the British gambling sector may be any or all of these things.
In the twisted world of governmental marketing, that is your fondest dream in case you haven't noticed.
© Football Is Fixed/Dietrological
