Thursday, 28 September 2017

Fundamentally Flawed

The puzzling Tweet above, apparently triggered by a delayed reading of my excellent and well worth reading Q and A with @Statsbet, before the series took a turn for the worse, appeared in my Notifications this afternoon.

I say puzzling because by James’ own definition**:
a technical trader pays no attention to the past performances of entrants, only considering price movements, market behaviour and structure.
Which is exactly what the systems mentioned on my blog do. 

For the purposes of the Q and A, I used the financial definitions for technical and fundamental analyses as my basis, although the sports and financial markets obviously have big differences.

We all may have our different takes on how these financial market terms should be interpreted when it comes to sports, but to me, fundamental analysis for sports investing means looking at the fundamentals of the individuals or teams competing in the event. So for an NBA game, I might consider injury reports, previous results, days of rest, time zones, individual match ups and so on.

I don’t do this. It might give me an edge if I were travelling with the team and knew they’d been out for a massive session the night before or that Barrow’s star striker Byron Harrison had again slipped in the shower and would be missing the next game, but I don’t have access to private information like this.

Incidentally, although James’ Tweet implies otherwise, the difference between technical analysis and fundamental analysis has nothing to do with whether the data is public or not. Or at least not that I am aware.

Under the ‘fundamental’ heading, I also include silly ideas such as looking at previous results between two clubs, or thinking that because a team has been involved in recent high scoring games, that this is significant or can give me an edge. Others, with far more resources and time than myself, will have already analysed these things far more efficiently than me and my spreadsheet ever could, and it would be delusional of me to think I could ever gain an edge this way.

By ‘technical analysis’ I mean that I look solely at market data, looking for areas where the market may be inefficient. What the sport is, who the teams are, where they play, who plays for them etc. is all irrelevant in my opinion, all a waste of time without private information. Yes, the market data is publicly available, but that doesn’t change the nature of the analysis from technical to fundamental.

Thanks to Tony Stephens for pointing out a rare typo (now corrected) in my last post:
Feeed? Is this some kind of test?
No test - just a rare error to show that I am human.

** For more on this subject, reference p4 of James Butler’s Betfair Trading Techniques.

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