Lambretta of Thoughts of a Football Trader's latest post, rather strangely titled "the chicken or the edge" opens with:
What stops us from becoming the trader we aspire to be? Why, when we look at the market, do we see all this money available yet fail to extract any on a consistent basis? The answer is fear.The answer to why most traders lose is because they have no edge, or their edge is so small that it fails to cover commission costs. This is another of those posts that suggests if you can't make a profit, it's because of an emotional flaw, in this case that you can't handle the emotion of fear.
The statement implies that if all traders active in the markets are 'fearless', every trader would be a long term winner. It's nonsense of course. In a zero-sum game, with commission costs, that would be impossible.
He continues:
What can we do to remove those fears, to build confidence, knowledge and therefore control? We find our edge.The problem here is that the statement implies we all have an edge to find, and if you can't find yours, it's your fault. For God's sake man. it's there - just find it! What the heck is the matter with you?
Later in the post, Lambretta acknowledges that the key to mastering fear is in having an edge, writing in a somewhat biblical style:
The kingdom is on offer to us, there for the taking, but without an edge it remains so close but so firmly out of reach. Ask yourself, right now "What is my edge?"
If your answer is quantifiable and based on positive probability, you're likely already profitable.
If you're not, maybe your execution needs work.What else is an edge, if not a positive expectation?
Speaking of which, someone very generously pointed me towards an idea which has led me to come up with what would have been a very profitable system over the last four and a half seasons using Pinnacle's closing prices available for free courtesy of Football Data.co.uk.
Using just two filters in one league, the system would have generated 417 bets for a profit of 174.25 points, an ROI of 41.8%. My P-value calculator gives a value of 0.000368, (or 1 in 2,716) for these results.
Too good to be true? With half the season left, I'm adding this to my portfolio and will provide updates here from time to time.
Although no Pinnacle prices are available prior to the 2012-13 season, I'll take a look back to earlier seasons and see if this bias goes back even further. The Bundeslayga System has shown that inefficiencies can persist for a long time, but an ROI of 41.8% from this sample size is quite ridiculous.
1 comment:
Hi Cassini,
I recall you believe fewer goals equals more draws, I'm not saying your wrong, but here's an extract from Mike Lindley of the Winabobatoo weekly magazine, he's changed his mind.
Copy and past from Mag.
"Is there a reason why some seasons produce higher/lower draws?
Some years ago, I had a theory that if fewer goals were scored, the chance of a draw occurring would increase.
In games that have two goals or fewer scored, the possible scorelines are 2-0; 0-2, 1-1, 1-0, 0-1 and 0-0.
Out of the six possible combinations, two outcomes (33%) are draws. When up to three goals are scored
in a game, the possible outcomes are 3-0, 2-1, 2-0, 1-0, 0-3, 1-2, 0-2, 0-1, 1-1 and 0-0. Out of the
10 possible combinations, there are only two combinations that result in a draw (20%). Do fewer goals mean
more draws?
The next table shows the average goals per game in each of the last 11 seasons:
Draws All Cases Games Draws Draw% Goals Rank GoalsInSeason GoalsPerGame % Profit
2010-11 2429 653 26.88 1 6,694 2.76 -4.47
2011-12 2357 629 26.69 2 6,489 2.75 -4.17
2016-17 802 189 23.57 3 2,142 2.67 -14.94
2009-10 2404 651 27.08 4 6,312 2.63 -4.17
2013-14 2427 629 25.92 4 6,374 2.63 -7.55
2015-16 2427 640 26.37 4 6,376 2.63 -3.92
2007-08 2426 626 25.80 7 6,333 2.61 -11.24
2014-15 2268 560 24.69 8 5,914 2.61 -10.81
2006-07 2429 589 24.25 9 6,172 2.54 -17.19
2008-09 2415 670 27.74 10 6,053 2.51 -3.16
2012-13 2412 645 26.74 11 5,524 2.29 -5.02
The 2010-11 season saw the highest average goals per game but there were 26.88% draws, losing just
-4.47%. The two rows at the bottom (the two lowest average goals seasons) do have smaller losses from
backing the draw which does tie in with my theory, but 2006-07 was the 9th lowest for goals and draw bets
lost -17.19% in that season. That blows my theory completely out of the water!
I can say that I've spent more hours than I care to remember over the last 17 years trying to fathom out the
draw, and I always come back to the same conclusion: it's a semi-random result that we have no control
over. We never know when it's going to be a pain, and we never know when it's going to go quiet. What we
do know is that the evidence clearly shows that it eats up more than it's fair share of the bookmakers'
over-round. This means betting with the draw is the better long-term option than betting without the draw.
Mike Lindley"
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