Tuesday, August 19, 2008

Jug Future Pool - Racings Potential

On vacation I finished a new book called the Political Punter. It was a fairly good read that explained the markets in both the bookmaking and exchange world regarding betting politics. In it the author showed how public sentiment, uncertainty and swings can light up a betting market.

For example, I watched the trading on Intrade, Tradesports and Betfair for the John Kerry-GW Bush 2004 election. Early in the day, Matt Drudge and a few others spoke about exit polls that said John Kerry was winning key states, including Ohio, which would be pivotal. The trading absolutely exploded and it looked like Bush and Kerry were stocks like Intel with shocking earnings news. Kerry's price plunged as traders hammered this news. The market was swingy and it was very interesting. Of course, Bush walloped Kerry and the exit polls were wrong (people learned the hard way that conservatives tend to not answer exit polls!), but it was obvious - swingy markets with uncertainty; with pretty much any betting prop can be exciting.

Now look what we have with this years Jug, around mid-July.

1) Somebeachsomewhere, who would likely be 1-5 to win this thing, apparently not going.

2) Art Official not eligible either, but he can be eligible if he wins the Cane pace (which he showed no interest in going to).

3) Badlands Nitro the chalk.

Fast forward to today

1) Reports (I did not see it, but I read it from someone who watched) that co-owner of Somebeach apparently said it is not impossible that the Beach skips the Jug

2) Art Official supplementing to the Cane.

If this market was on an exchange, or heavily promoted to all types of gamblers, especially price sensitive types that would play an election, you would have one swingy market. And it would be hot. I would bet $1000 bet on SBSW in July at 5-1 would now be worth 3-1, and a bet on the field at 8-1 or so, would now be below 5-1. If Art Official fails in the Cane, the field would then go back up to 10-1 or so.

Will this ever happen for a pool like the Jug future pool? Yes, I think it will if it is done correctly. I think within five or ten years there will be Jug future wagering on an exchange platform with the world being able to play it. if we position ourselves and sell it right, I think it can work and get people interested in our game. Give people a swingy market, with information they can find on the web, they can achieve value. Since Adam Smith told us that the invisible hand guides us, it is a mathematical certainty that gaps in the market will be filled, if there is money to be made.

Note: Nice example of this, this morning. The 100M hurdles final at the Olympics was being traded in running at Betfair. Before the last hurdle, American heavy favorite Lolo Jones was in the lead and heading to an easy win. Someone placed $12,000US on her to sell at 1.01. Someone snatched it up. What happened next is why Andrew Beyer once said "a gambler may have as many periods of frustration as he does exhilaration, but at least he knows he's alive" - she clipped the next hurdle, lost her momentum and missed the board. Someone for a risk of $120, walked away with $12,000 cash, in less than one second.

4 comments:

Anonymous said...

Ok.... Can you explain this to me. How on earth is a wager made over the internet in the last seconds of the 100m hurdles? How can the transaction be made that fast?

Pull the Pocket said...

Hey A,

It is just like a stock trade. If you see a stock with bad news that is 20 cents and it is spiralling, you might still a good til cancel order at 4 cents, just in case someone hits that bid.

In this case someone wanted some easy money when the large fave looked good about half way through the race and wanted $12k at 0.01 to make $120k. Someone said "she has a chance to lose, so I will take anything at 1.01".

It happens in running quite a bit actually. There was a story recently where a horse in the UK stumbled over a barrier and a woman at home bought him to win at 1000-1. The horse came back on and won. She made 15k in pounds and it made big news.

ptp

Allan said...

I understand the concept, but don't see anytime in the foreseeable future where they will allow betting exchanges in the United States (can't speak for Canada).

Pull the Pocket said...

Maybe so Allan, but if we spent as much time at State houses asking for non-monopoly wagering platforms and changes to compete and grow our game as we do asking for subsidies and slots, maybe we could have one in North America already.

Just my 2 cents.

PTP