Well that's pretty typical, I have been cruising recently and things have been looking up. I was looking forward to this week and saw plenty of opportunity, then pow!!!!!! Betfair goes do lally and my week vanishes down the drain. At this point I don't know if I can regain the losses over the remainder of the week, this is always so frustrating when it happens. Personally I think Betfair should void any markets where their system crashes. It is clear that the majority of volume on Betfair is traded and therefore when the site goes it's traders that suffer from positions they can not close. These are often at many multiples to any potential profit. Betfair however, get a lovely bonus in commission from traders who have open positions. Surely this an incentive for site instability not a disincentive? If markets were voided then Betfair would suffer and this is clearly who needs to suffer when the site crashes, not the customers. Any how, I now have to knuckle down and reduce the damage for the remainder of the week.
Wednesday, 14 May 2008
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27 comments:
I'm sorry to hear that, your so right about Betfair, they should be taking it on the chin when there site crashes! I lost my full bank last time and Ive had two near misses all in this year! It's a joke. I hope someone like betdaq gets big enough to trade on but I doubt it.
Anyway I'm sure you'll come back to profit this week, If It was me it would take me months just to get my bank back up!
Good luck.
How did you loose? did you back the fav then couldn't get the lay off or what?
Yes I agree Betfair profit from their own failures. This can't be right. Perhaps they could create some sort of traders agreement. You could agree that in the case of a crash your bet would not stand. This probably wouldn't hurt betfair as there would probably be equal ammounts of traders money each side of the market. they might start to do something serious about these crashes. Sort it out Betfail.
You're spot on - Betfair don't lose out in these situations and have no reason to make the site more stable. They should void all the crashed markets. If people still want to punt they can nip next door to the bookies. Losing out on placing a bet has a lot less impact than a trader losing a day's or week's profit. Is it me or has the site suffered with reliability problems alot more over the last month or so?
Sorry to hear you were caught out.
Wait, so you weren't able to call Betfair in time to close your positions? I thought you had this kind of scenario planned out?
"I thought you had this kind of scenario planned out?"
When Betfair crashes there is nothing you can do, the call centre can't place bets for you as they are reliant on pretty much the same system as end users. If I have a crash at my end then I have that covered in anything but exceptional circumstances. Betfair has been very poor of late, all this on top of them introducing a charging structure to improve site stability!!!
The pain when this happens is insane - happen right before and around UEFA cup final as well -
Betfair could throw a pie at our faces, and the sick thing is that we would still go back for more.
Being unable to access the platform is an inherent risk in your chosen strategy of 'trading'.
Voiding valid bets on a market simply because you have developed a level of risk that your unhappy with is not the solution - it is entirely unfair on all those that took the bets in good faith.
You could always change your strategy or your levels of risk...
Trading produces such a small % return on the captial committed to the market that any outage is going to hurt real bad. The pain is not proportionate to the gain.
I think I would agree with your comment IF conventional betting was the norm on the exchanges but the fact is that trading volume far exceeds standard betting volume on the exchanges. Normal bettors rely on the liquidty provider by more advanced strategys. Betfair know that and part of their competitive advantage is down to this fact. So it makes sense to lean towards this fact.
I can't imagine Ford not having an incentive to make their cars safe, yet Betfair feels its ok to adhere to a policy that doesn't exactly punish them for their errors.
Volume is an entirely useless measure if you are taking both sides of the bet. Commission rate is the only meaningful measure of how 'big' a customer you are on the exchange. It is entirely feasible on a liquid market, such as Prem football, to turnover 2-3 hundred grand yet stand to win/lose no more than a few hundred quid. No matter what you 'traders' think, you are completely unimportant to the exchange as a whole.
Betfair's strategy was based on matching punter's bets in the knowledge that one of them will always win and thus pay commission. Scraping off of the market does not produce anywhere near the margins of those that take a position...
Revenue (volume) is vanity, profit is sanity...
To qualify my comments (I'm the one disagreeing entirely with your construction that trading is important to the exchanges) here are my figures since starting seriously on Betfair, Jan 1 2006...
Starting bank: £5000
Current bank: £66,500
Withdrawals: £44,778
Lay volume: £1.372m
Back volume: £34,000
Total volume over nearly two and half years nothing to boast about...margin OK, profit good.
"No matter what you 'traders' think, you are completely unimportant to the exchange as a whole."
I'd definately disagree. Who do you think is on the others side of your £1.3m? Punters? Fraid not. If you ask Betfair or look at the published data, it is almost certainly traders or people hedging postions, as they account for a vast majority of volume on the exchanges. You should be happy that you have succesfully removed money from their pots rather than claiming you don't need them.
Betfair have often acknowledged the role traders have played in maintaining their competitive advantage. You only need to ask WBX or Betdaq why they haven't suceeded and its a chicken and egg syndrome. They need liqudity to get better volume and prices to attract the whales into the market. Without those their models have completely floundered.
It's great that you have managed to pay Betfair some chunky commission and still managed to make some money, that's not a sure thing whatever your style. I would agree with you that Betfair care more about their big commission payers, that for certain.
The great thing about the market is that there a so many people co-existing within it with varied styles doing so many different things. Long may that continue. Its in all our interests that the market continues to grow, if it doesn't and the liquidity dries up, everybody is stuffed.
I'd definately disagree. Who do you think is on the others side of your £1.3m? Punters? Fraid not.
Totally disagree. I bet in markets where liquidity is low - traders simply would not be there as they'd be stuck with positions with no chance of getting out...as I am, by choice. They don't do that.
I agree with the sentiment of your post though, that is that it takes all sorts. I think it completely wrong, however, that one should assume that your chosen strategy is right and that BF should adjust their rules to suit you.
You have an edge, clearly, otherwise you'd not be winning, but likewise some of us have developed an edge through different means. I'd lobby BF very strongly if they considered voiding valid bets on outages as it does not effect me or the people that bet with me.
The exchange works and some of us win. Expecting the rules of engagement to change to increase your chances of winning though is completely unjustified.
As I stated originally, outages are an inherent risk with your chosen strategy. If the risk is 'not proportionate to the gain', don't do it... You can always deposit your money in Northern Rock...that's government backed so virtually risk free :)
Here here Pinsticker!
I fully agree with your post their in response to the anonymous poster. To say "No matter what you 'traders' think, you are completely unimportant to the exchange as a whole." shows a lack of understanding of the Betfair markets by the poster. I am a small time trader as you know but my tunover is approaching £1million a month, someone such as yourself must be turning over much more. As you say without the liquidity these other exchanges have not been able to take off. If you read my post today (May 15th) I contacted Betdaq and have a phone meeting aranged with them to discuss the issues. One suggestion I made was that they pay the likes of BetAngel to develop their software for Betdaq and they should offer the big traders 0% commision as well as much more to get them to switch. If the traders switch to another exchange the punters will follow suit.
If the exchanges didn't need the traders these other exchanges would have taken off long ago as there are plenty of normal punters around. As you say pinsticker, without the traders they can't make it. But if the other exchanges started to make a bit of an effort a small slide may turn into a landslide! It won't take much in the current climate!
Changing the subject completely, I would like to ask you Pinsticker how you deal with trades that have gone against you. I am a new small time trader (for the moment) as I learn the ropes of trading, but I am still struggling with dealing with trades that have gone against me. So if I give an example, I'd be very interested to hear what your strategy would be. Let's say, I have laid the fav at 3 for £100, believing the price was going to drift. However the market has turned and the price has actually shortened to 2.5, and the start of the race is fast approaching, what do you do?
I soon learnt that letting the bet ride is definitely not an option for a trader. The different options I have experimented with, are setting the bet to take sp, taking a price shortly before the off, spreading the loss equally over all runners, and leaving the loss just on the favourite. I need to have a definitive strategy but am undecided what way is the best for me, so I'd ve very interested to hear your views.
Guys, guys... the truth is we need each other, but we - as traders - have to accept that crashes are an occupational hazard. No one's website is immune to crashes, and one as complex and all-encompassing as Betfair is bound to be vulnerable at times. Carping on about them achieves nothing. Without them we would be out of business and it is totally ludicrous to expect them to void bets taken in good faith. I often make really good money, taking advantage of sudden massive swings in the market. Is that down to traders? Of course not. It's down to major punters or bookmakers covering their positions. Week after week we cream off bigger money than most people could ever earn.It ill behoves us to bleat like a bunch of old nanny goats when we have one bad day!... Fuzzer
I'm not sure Betfair crashing should cost some customers and not others. It is a difficult question and I can understand the opinion of the anonymous poster. Downtime does not affect him and he's lucky in his chosen strategy but I think it should be a level playing field for all end users.
Pinsticker, could you not trade out at least part of your liability on Betdaq or did you not know how much was matched?
Also, well done Pinsticker for publishing the anonymous opinion, which is obviously contrary to yours. Very fair minded.
I am gutted for you - it can be devastating when this happens
When you are making money regularly, put 10% of your weekly winnings in your Australian Wallet to cover glitches like this - see it as a kind of insurance policy.
It will still be painful if it happens again - but that Aussie wallet wont half soften the blow!!
Remember we dont have to pay tax which would be a lot more that 10%!
we have to accept crashes, someone says
I totally disagree, Betfair have to find a solution, like void markets, beacause it's not a movie review forum, there is people's money inside!
I'm one of the few traders that begin with a back and after lay, so it's true that my losses in a block are not great, but they are costant
400 euros last block, 40 euros two days before in greyhounds....
boring loose money in this way
I totally disagree, Betfair have to find a solution, like void markets, beacause it's not a movie review forum, there is people's money inside!
Hold on there one minute... You have chosen a low risk gamble BUT a very high risk investment. Voiding markets would kill the exchange completely as you'd lose all of the gamblers and without them, no matter how much you guys try to convince yourself, you DONT have a business.
Trading exists because of gambling, not the other way around. If exchanges did not exist you would not be on this blog...however gambling would still be happening on every golf course, snooker club, race track, card room and pub around the world.
Don't let's forget how and why you are here.
"Trading exists because of gambling"
That's quite an old fashioned view of the modern gambling market place. In the old days books were priced at 120% and you really couldn't get any decent sums on. Now you have books close to 100% and size isn't really an issue. Gamblers alone have not created this and never would have if traders were not taking on that risk, they are the majority in the market by a long way.
It's a bit like saying transport wouldn't exist without Oil, it would but we would still be sailing ships by wind and using horses to travel instead of gambling on them!!
It's a bit like saying transport wouldn't exist without Oil, it would but we would still be sailing ships by wind and using horses to travel instead of gambling on them!!
Actually it's nothing like that at all... It's like saying there would be no oil traders if there were no consumers of oil...which is a fact...
You can not trade in a market where there are no consumers.
Unfortunately you completely missed my point. You always need an underlying market but trading makes many more things possible. If you don't like traders you could go back to your wind powered ship, or that bookie quoting you 120% books. We take on risk at ever decreasing margin to provide the structure for these modern markets. That needs to be clearly recognised.
No problem with traders. My problem is with those that use the exchange and want the rules to be changed when their chosen strategy, the risks of which are known at the outset, results in them losing. The ruled are just fine as they are now. As you say, if you don't like it go somewhere else...
"The risks of which are known at the outset"
And there in lies the problem, that no longer appears to be the case. We've taken on board Betfair's requirement to reduce excess usage but instead of the site being more stable its worse. There is a clear requirement to reflect this instability in the terms or correct it. Or we will go elsewhere.
Just reviewing the posts as the end of the year closes in and I'd like to acknowledge that my knee yerk reaction here was probably wrong. I think that voiding would also increase the chance of site instability. So it's not great that Betfair keep all positions open but I can really suggest a viable solution looking back at this many months later.
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