Wednesday, 24 March 2010

50? Not Yet

Who needs a Purple Betting Day anyway? For the first time in 2010 I have managed to hit the magic 20% level on my charges, (see screenshot above) albeit with the 'help' of a big loss on the NCAA tournament (buzzer beaters, love 'em or hate 'em) which single-handedly all but wiped out the rest of last week's profits. The silver lining of that loss does at least mean that I dodge the Premium Charge for once. Since its inception I have been hit exactly 49 times with it and I am not in a hurry to complete the half century.

The Sports Betting Professor went one out of two on Sunday for an overall record of 4 of 8, but with the winners coming in at between 1.8 and 2.0 so far, this is not yet proving to be a viable proposition. When commission is factored in, the outlook becomes even less rosy. Assuming an average price on these selections of 1.9, the selections need a strike rate of 53.73% to make a profit. Other negatives with the service are the steady flow of e-mails recommending various sports books, sports information services, football systems etc. but most worrying of all is the e-mail from PayPal advising me that they believe an unauthorized person has attempted to gain access to my account. Since this account is seldom used, and the transaction to SBP was the first PayPal transaction in several months, that was rather a concern. The good news is that, as a result, PayPal are reversing the transaction with SBP, so it looks like I’ll end up with a free trial, to last as long as it takes SBP to realise they haven’t been paid!

Football Elite had a disappointing weekend with two winners from five recommended bets, Mallorca won at 2.2 which was again a generous price for a team with their home record, and Sampdoria were a nice winner at 2.6 but a net loss overall for the service. I have mentioned Mallorca’s home record before, and 2.2 was a very generous price. Football Elite’s short-list bets were disappointing, with just one winner from five.

Some intelligent comments from Matt and Unprofessional Gambler related to my post on the Purple Betting Day campaign. Consensus is that although the site does contain some affiliate links, they are nonintrusive and acceptable. Also, the Betfair website is the best of its kind out there. I agree. I find the BETDAQ interface a little ‘clunky’ to use, at least for in-play. It’s fine for punting, but for in-play it somehow seems cumbersome. Add to that the fact that the liquidity is much poorer and the selection of in-play events is much reduced, and there’s the reason why most people who trade have no real option than to use Betfair right now. Both Matt and Unprofessional Gambler agree that Betfair needs real competition. Monopolies are not good for the consumer. For example, it’s difficult to imagine that Betfair would have introduced its Premium Charge had their market share of the exchange betting business not been as dominant as it is.

I think this campaign would be better served by selecting certain events where traders would be encouraged to move to BETDAQ, rather than switching for an entire day. Something like nominating the FA Cup semi-finals as a BETDAQ event perhaps? Maybe BETDAQ would consider lowering the commission rate as an additional incentive? One of the problems with selecting a 24 hour day is that many markets don’t exist on BETDAQ and not too many traders are going to forsake profits to make a point. BETDAQ really could help themselves a little more. They had a golden opportunity to capitalise on Betfair’s misstep, but other than offering a reduced commission rate for a few months, really didn’t embrace the opportunity.


Anonymous said...

I think what you and the "go purple" people fail to understand is that for Betfair's business model and 99% of it's customers it isn't a monopoly - Betfair is in direct competition with other online bookmakers to offer prices on events. Profitiable trading is a by product of liquidity and more importantly losing liquidity.

This 99% who lose in the long term couldn't care less about the premium charge, the reasons they gamble is complex, but cost's or commission is probably down the list (look at Betfair TV adverts). Betfair need to attract these people for their own business, but by doing this leg work they create more oppurtunties for their profitable punters to make more money, hence the premium charge to contribute more to this - I find that a fairly sensible argument especially for those with a relatively low risk strategy.

Whether there is another "trader viable" betting exchange would be dependent on the losers moving to it (if we presume that all traders are profitable and I'd say almost all those driving the monopoly narrative are). Traders moving over to Betdaq would be like a bunch of hungry dogs fighting over a piece of grisel, they'd soon be eating each other until theres no dogs left. Commission might be low but Betdaq wouldn't be able to attract new meat - low commission isn't enough.

I do think traders are a hostage to fortune to Betfair, but as trader's can't exist independently then the monopoly argument doesn't wash. Traders don't have a right to have a platform to make money, the way inciting the wrongs of a monopoly would suggest.

If you want an example of ultra competition then look at the rest of the bookmaking industry and let me know how successful you would be if you made consistent money from them.

Anonymous said...

Why do you not post the full premium charge statement? The image you have is one of two and posting it doesn't really show anything as the one of the left will always be around this figure. It seems a bit underhanded to pretend that this is the one on the right? It makes me suspicious of your claims to be profitable.