Sunday, 19 September 2010

Extraordinary Claims

There are hundreds of thousands of people around the world who study the football markets, many of whom receive 'news' ahead of most of us, and some of these people back or lay as a response, and the market adjusts.

By the time most of us get the news, it is old, and the market has already factored in everything of relevance that is known. Without access to inside information, just what 'news' most of us are going to be able to use to give us an edge is a mystery to me.

One of this blog's readers, Romford Anonymous, makes the extraordinary claim that he has the rare gift of being able to "interpret and use the news" to his advantage, even after it has filtered through thousands of other people who apparently do not have this talent, or there would of course no longer be any advantage. "Not something that I would have a handle on", he adds. Well, no. Although arrogance and I aren't complete strangers, I think that claiming to be able to "interpret and use news" that has filtered through thousands before me would be a tad too much, even for me.

Romford's claim would mean that the Premier League markets are inefficient - in an efficient market at any point in time the actual price will be a good estimate of its intrinsic value - and while this may have been less true in the past than it is today, the latest studies show that the markets "appear to be associated with higher relative efficiency". In the Internet age, a huge amount of information is now widely available, and the ability to number crunch is available to anyone.

Admittedly, studies also show that an edge can be obtained by "bettors who are experts in the field but who do not have privileged information". While that conclusion was drawn from a study made on the horse-racing markets, I have no doubt that it applies to football as well, and if you are indeed that rare 'expert' then well done indeed.

However, extraordinary claims require extraordinary evidence, and while posting Anonymously isn't a promising start, neither is suggesting that 1.87 is "an horrendous price to lay at" based on nothing more than a rumour that turned out to be false as should have been apparent by the price at the time, or claiming that because it has never happened before, no Premier League team should ever be considered a three goal favourite away from home in the future

Romford Anonymous may well be a rare expert in the football markets, but the evidence suggests otherwise. Mere mortals such as myself, will continue using mathematics as the basis for an approach to unraveling the great puzzle of football betting.


Anonymous said...

Ummmm. Basically you seem to be saying the Villa price was correct at the time you laid it?

Which begs a rather obvious question.

Anonymous said...

Also, you seem to think I was talking just about Davies. Presumably you've concentrated on him because he played and scored and you can attempt to use this as a reason to bat away my thoughts.

Their keeper and Cahill being missing was obviously another very important factor in why the 1.87 was wrong.

You're suggesting the 1.87 was correct because Davies did play. You're also discussing market efficiency.

And the market efficiency is precisely why Villa went off considerably shorter despite the presence of Davies. The big players, and top experts in their field, had assessed the final information available (publicly available - when teams are announced) and the match was priced accordingly.

You are the one guilty of breathtaking arrogance at times. If you open your eyes you would see you can further develop your systems. However, you seem to prefer to attempt to dismiss any comments which could in fact help.