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That's interesting statement about the technology as Betfair claimed pre-float that their software was so advanced that it was nigh on impossible to match. The point about the horseracing in running is that Betfair are getting a massive chunk of the turnover, much more than their normal rake. How it works is that their favoured clients place bets on races that have effectively finished so they cannot lose 99% of the time. In return for this "no lose scenario" theose same clients pay Betfair a much higher rake. If Betfair where to match the bets themselves directly people would say that the house is playing it's own tables!

BF's core engine is a potentially difficult problem to solve (but has been solved by others - not just BetDaq - without that much difficulty), but they have it a lot easier than traditional bookies in other respects which I'll not go into here.

The cognoscenti may have noted that BF do not offer true multiples. There's a good reason for that and for interesting reasons they choose not to tackle that technical problem.

Huge turnover, but profitability is low. Especially given the number of staff they hire and their running costs.

They've always had trouble staying up as well.

Edited by the_duke_of_hazzard
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BF's core engine is a potentially difficult problem to solve (but has been solved by others - not just BetDaq - without that much difficulty), but they have it a lot easier than traditional bookies in other respects which I'll not go into here.

The cognoscenti may have noted that BF do not offer true multiples. There's a good reason for that and for interesting reasons they choose not to tackle that technical problem.

Huge turnover, but profitability is low. Especially given the number of staff they hire and their running costs.

They've always had trouble staying up as well.

Cognoscenti is new word for me, had to google that one, sprezzatura was a good one I "learnt" the other day.

I don't think it's a technical problem that they don't offer multiples more a practical one - in an exchange model who is going to stand potential returns of a big acca - unless they are in the markets themselves? if it's about rolling over bets as they win then only a limited number of markets could sustain that - top level football and british horse racing. Multiples are generally a bad bet anyway as it has the effect of compounding margin - a bookmakers dream - look how many bonuses they put on a Lucky15 slip in your local Ladbrokes.

Huge turnover/low profit is the name of the game, where you have no risk in the market. They couldn't care whether the favourite wins this afternoon or not. Agreed they are over expanding and the people they do employ are obviously the worng ones, recent outages were because they were updating the site on a Saturday afternoon??? Apparently nobody bets on a Saturday!?

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Huge turnover/low profit is the name of the game, where you have no risk in the market. They couldn't care whether the favourite wins this afternoon or not. Agreed they are over expanding and the people they do employ are obviously the worng ones, recent outages were because they were updating the site on a Saturday afternoon??? Apparently nobody bets on a Saturday!?

They were unplanned outages, and they've been occurring with more frequency recently. They have trouble retaining staff.

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But one thing you can say about them, they typically offer much better value than the traditional UK books.

Don't forget to knock off 5% commission on your winning bets. In an afternoon if you have 2 x £100 bets on an even money winner and a loser at Betfair you walk away with -£5 in a bookies you walk away level. The better prices are typically on outsiders not favourites.

Then if you win regularly you are subject to a 20% Premium Charge. This in effect makes a 5/1 winner just a 4/1 winner - some value.

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Don't forget to knock off 5% commission on your winning bets. In an afternoon if you have 2 x £100 bets on an even money winner and a loser at Betfair you walk away with -£5 in a bookies you walk away level. The better prices are typically on outsiders not favourites.

Then if you win regularly you are subject to a 20% Premium Charge. This in effect makes a 5/1 winner just a 4/1 winner - some value.

Sure, but you're not likely to gets evens at both. A 2 on BF will be 1.91 at a book.

Of course you can find better value at some books on some events. That's kind of the point of sports arbitrage, but the highstreets follow BF markets and cut accordingly anyway. So how long will that price last? And of course hit those regularly and you're gone anyway. As they guy before said, most uk books just don’t want to take a bet.

I'm not justifying BF at all, but the point is you can determine the vig at BF by your commission rate.

What's the average vig at a UK book?

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Sure, but you're not likely to gets evens at both. A 2 on BF will be 1.91 at a book.

Of course you can find better value at some books on some events. That's kind of the point of sports arbitrage, but the highstreets follow BF markets and cut accordingly anyway. So how long will that price last? And of course hit those regularly and you're gone anyway. As they guy before said, most uk books just don’t want to take a bet.

I'm not justifying BF at all, but the point is you can determine the vig at BF by your commission rate.

What's the average vig at a UK book?

The only reason you get better prices on BF is if something is not off. They have the same accounts laying the same combos day in day out. If you bet in running you get picked off by someone on-course or one of the punters who can buy the clean feeds. take all this into account and betting before Betfair was not so bad.

Betfair horseracing markets are pretty rotten. As I type this Betfair Forum Mods are deleting all threads mentioning their soon to be bankrupt most high profile winning loudmoth gold cup winning advert for the exchange.

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The only reason you get better prices on BF is if something is not off. They have the same accounts laying the same combos day in day out. If you bet in running you get picked off by someone on-course or one of the punters who can buy the clean feeds. take all this into account and betting before Betfair was not so bad.

Betfair horseracing markets are pretty rotten. As I type this Betfair Forum Mods are deleting all threads mentioning their soon to be bankrupt most high profile winning loudmoth gold cup winning advert for the exchange.

At least with Betfair's rigorous KYC procedures nobody could be betting on other people's accounts.

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  • 2 months later...

I ventured into the exchange shop in the big bankers building a while back and it had barely a dozen gamblers. Now this is where they watch professional bookmaker transmissions which are seconds ahead of your average Sky mug punter sat in his council house. So how profitable can it really be if the place was 3/4 empty? And how much dole money can the stay at home mob afford to subsidise all this?

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  • 5 weeks later...

Betfair have gone mental to support their nose diving share price and increased the "premium charge" to 60%. This means that people who lay non triers and bet after the result is known can only keep 40% of their ill gotten :blink: Betfair have implied that their actions are to support the smaller punter who gets fleeced by Betfair's roster of insider winners ;) Now the little guys can rest assured that the coin that they have been scammed out of is going to a good cause :D

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The new Premium Charge only kicks on if people have won £250k in their lifetime. To pay 60% people have paid less than 5% commission in their lifetime i.e. they must hardly have a losing bet.

Betfair say it is to help small punters because these people are winning too much money. The choices were

1) Ban these people and threaten them that if they return any winnings would be confiscated.

2) Take 60% of their profits because Betfair know they have nowhere else to go.

They did 2.

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The new Premium Charge only kicks on if people have won £250k in their lifetime. To pay 60% people have paid less than 5% commission in their lifetime i.e. they must hardly have a losing bet.

Now how would they hardly have a losing bet then? Either they are so, so clever or they are laying non triers or betting after the result is known ;)

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Just introduce a flat rate transaction tax on all Sterling transactions and then scrap all not LVT taxes.

Impossible to evade and mininal collection costs.

Parties could then compete on the basis of what rate of transaction tax they'd need to charge and not be allowed to run a defecit, if governments overspend or the services start to diminish then they can be punished at the next election.

Sterling would lose 30% within a week of it being introduced. The extra cost of implementation would always be put straight onto the bottom line, this would be massively inflationary. The subsequent rate rise would wipe out even more businesses and smash consumer spending even further, equaling in a lower overall tax take.

We already have something called VAT which is a defacto transaction tax anyway.

The fall in consumer spending would massively outweigh any benefit in exporting advantage due to a weaker sterling. We'd actually have to pay our workers less in real terms that your average Chinese or Indian currently receives to gain any advantage.

All non UK transactions would simply be carried out in another currency. The Govt could do nothing to stop this.

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Sterling would lose 30% within a week of it being introduced. The extra cost of implementation would always be put straight onto the bottom line, this would be massively inflationary. The subsequent rate rise would wipe out even more businesses and smash consumer spending even further, equaling in a lower overall tax take.

We already have something called VAT which is a defacto transaction tax anyway.

The fall in consumer spending would massively outweigh any benefit in exporting advantage due to a weaker sterling. We'd actually have to pay our workers less in real terms that your average Chinese or Indian currently receives to gain any advantage.

All non UK transactions would simply be carried out in another currency. The Govt could do nothing to stop this.

You would probably see moving to cash transactions, and sites/companies also offering goods and services in euros/dollars the value of the pound would plummet/hyperinflation

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Betfair can only do this because they have no effective competition.

The traders cannot decamp en masse to Betdaq because there isn't enough 'real' money to win - they would just be eating themselves.

I don't understand Betdaq - this is a massive opportunity for them to catch up, but they seem content with taking the scraps.

They need a 2 pronged strategy to attract both punters and traders (because it is the traders that provide the liquidity).

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Betfair can only do this because they have no effective competition.

The traders cannot decamp en masse to Betdaq because there isn't enough 'real' money to win - they would just be eating themselves.

I don't understand Betdaq - this is a massive opportunity for them to catch up, but they seem content with taking the scraps.

They need a 2 pronged strategy to attract both punters and traders (because it is the traders that provide the liquidity).

No they don't.

They just need a policy to attract the punters because if they get those, then the ever so generous "traders" would have to follow because they cannot eat themselves alive at Betfair.

What Betdaq should really do is 2% commission for anyone with a lifetime win of less than say £20k. Then have a sliding commission scale above a £20k lifetime win, so that the more you win the more commission you pay but obviously not as greed fuelled as Betfair's 60%.

Betfair's original 5% dropping to 2% in effect for winners was completely flawed. You need to encourage the losers not the ever so generous "traders".

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The only people really affected by this are people laying non triers and those using automated betting systems. the "500" Betfair say are involved take out more profit than Betfair do themselves. Betfair will probably copy the automated sytems for their own ends but they of course cannot offer to lay "non triers" for connections of these horses as that would be illegal and corrupt ;)

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Can someone explain this for me.

Say a retailer in the UK makes £1m profit in 1 year. Director's are british, living in Britain, trading in britain, working in Britain.

How exactly are the profit's off shored?

Once the profits have been off shored, is a dividend then paid in such a country, and the UK director's have their british bank accounts credited with the dividend, minus any tax if they are a higher rate payer? :huh: I don't quite understand how they get away with it.

My company had profits of around 50k last year and the CT bill was £12k

In that case, it doesn't work. It only works if the profits are going to offshore investors, pension funds or similar.

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Betfair's original 5% dropping to 2% in effect for winners was completely flawed. You need to encourage the losers not the ever so generous "traders".

In one sense it was and that was why the introduced the Premium Charge but "traders" didn't benefit from it. Those who won and lost alot could push their commission down - making low margin strategies profitable. Traders and those with high win percentage would need to be making alot to get below even 4% - commission was an irrelevance to them. The premium charge is a means of distinguishing between winners and losers, be they winning gamblers or traders.

Traders have no option but to use Betfair, whether the profitable gamblers move to Betdaq could be interesting as alot will now be paying (or the prospect of). Traders do little for Betfair but you could argue that the winning gamblers do the leg work of pricing up events and therefore have some power.

I wouldn't hold my breath that Betdaq become a feasible competitor as I think gambling is much more about marketing - the reason that Bet365 and BetFred are doing well. Betdaq's marketing budget is presumably a fraction of Betfairs. I also think that people exagerate the effect of pricing in gambling, most leisure punters aren't price sensitive as it is an abstract concept in gambling, a percent here or there won't make much difference.

Anyway expect consolidation of the market if Betdaq do become a player (why they exist IMO)

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Sporting Options went under because they seeded their own markets badly. Betfair have pumped liquidity into their markets with the use of 3rd parties that they accomodated somehow ;) . They also funded people like Harry Findlay, Bloom and a good few others who played on credit.

Betfair are just infinitely better at pumping their markets full of alleged liquidity. Who audits the bets? Are they all for real :o

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Sporting Options went under because they seeded their own markets badly. Betfair have pumped liquidity into their markets with the use of 3rd parties that they accomodated somehow ;) . They also funded people like Harry Findlay, Bloom and a good few others who played on credit.

Betfair are just infinitely better at pumping their markets full of alleged liquidity. Who audits the bets? Are they all for real :o

Those were the days.

The Sporting Options markets were seeded so badly sometimes the full set of pre-race prices were all turned in play. There was little compeition there so you could wait until near the end of the race to back what looked like the winner and lay what might be losers.

Edited by Redhat Sly
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  • 433 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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