Results 1 to 17 of 17
  1. #1
    Aidan90's Avatar
    Aidan90 is offline Private Member
    Join Date
    September 2015
    Posts
    432
    Thanks
    108
    Thanked 149 Times in 111 Posts

    Default Why did bookies call Brexit wrong?

    I, like many others, took the bookmakers odds to mean Britain would vote remain. Most bookmakers had remaining as a clear favourite - I think I saw 1/8 yesterday. But obviously they got this wrong. Why? Was it deliberate?

    This article makes some interesting points:

    https://www.theguardian.com/business...ladbrokes-says

  2. #2
    TheGooner's Avatar
    TheGooner is offline Private Member
    Join Date
    March 2007
    Location
    New Zealand
    Posts
    4,272
    Thanks
    1,956
    Thanked 4,221 Times in 2,009 Posts

    Default

    It's all in the article ...

    As the polls closed on Thursday night, Ladbrokes was offering 4-1 on an out vote, with its betting suggesting that a remain verdict was a 90% certainty. But with much more money bet on remain than leave, the bookies are likely to turn a large profit.


    It is NOT the bookmakers job to correctly predict the result - it's the bookmakers job to frame a book so that the weight of money falls on both sides of the outcome - leaving them with a balanced book and profits no matter what result.

    We see discrepancies all the time in football markets with favourites under-priced because of the weight of money on them.

    Even in supposedly related markets within the same fixture we will see that the price on the home win in 1-x-2 market can be VERY different from the home side - 1.2 goal on the asian handicap market ... DESPITE THE FACT THAT IT'S THE EXACT SAME BET.

    This is because the 1-X-2 market is predominantly bet on by UK punters, and the asian handicap market is predominately bet on by asian punters - producing very different weights of money - and so very different odds for the exact same events.

    So while bookmakers may initially price up events according to the likelihood of occurrence, these odds will quickly change to accommodate the weight of money that comes in ... in order to maintain the balanced book and profits no matter the outcome.

    The key is the final piece of the quote ... But with much more money bet on remain than leave, the bookies are likely to turn a large profit.

  3. #3
    golfbettingsystem's Avatar
    golfbettingsystem is offline Public Member
    Join Date
    March 2014
    Location
    Bedfordshire
    Posts
    756
    Thanks
    152
    Thanked 374 Times in 262 Posts

    Default

    I guess the most tangible pointers are the opinion polls that were mostly pointing towards remain - if punters were using the results of these polls to determine where to place their money then that may have influenced the odds, particularly if the bigger bets followed the polls. Some interesting stuff in this article: http://www.telegraph.co.uk/news/2016...ere-the-polls/

  4. #4
    SeanEMJ is offline New Member
    Join Date
    May 2016
    Posts
    5
    Thanks
    4
    Thanked 1 Time in 1 Post

    Default

    Favourites lose all the time in sports events and horse races. Outsiders win at much longer prices than 5 or 6 to 1 on a daily basis. And no-one bats an eyelid. I've seen an absolute TON of people today wondering how the bookies could "get this so wrong". Why? It's just a betting market like any other. I really don't understand why people use betting markets (and Betfair in particular) as predictive tools for anything political. Punters are mostly just following the money and/or media views. They're not making informed judgments. Of all the millions of pounds staked on the Brexit market on Betfair, I bet the vast majority of it was people constantly trading in and out of positions as the markets moved. No predictive value in the odds at all IMO.

  5. #5
    moizez is offline Private Member
    Join Date
    March 2008
    Posts
    88
    Thanks
    38
    Thanked 22 Times in 14 Posts

    Default

    I think it was an error but was deliberately made.

    Knowing that people take bookies estimations as good estimations nobody was selling their stocks prior to brexit vote and the big money earned on the markets last friday could not have been earned as easy as it was.

  6. #6
    Muppet is offline Private Member
    Join Date
    December 2007
    Posts
    577
    Thanks
    166
    Thanked 661 Times in 290 Posts

    Default

    I think the better question is why do people keep looking at bookmaker odds as predictive of anything other than the ratio of money that a bookmaker has taken in bets?

    Imagine this simple scenario: one rich punter places a 10,000 bet on remain. 500 other punters place a 10 bet on leave. Assume the odds of the bets are such that the bookie will profit either way and that each person will vote the same way they bet. The weight of money is on the remain side but I'm sure you can extrapolate those numbers into which will win at the ballot box.

  7. #7
    Sherlock's Avatar
    Sherlock is offline Public Member
    Join Date
    December 2013
    Location
    WC
    Posts
    4,216
    Thanks
    1,275
    Thanked 3,307 Times in 1,842 Posts

    Default

    It is a nonsense. Bookies did not put the odds wrong, because the higher odds cashed. Did bookies put wrong odds on England? On Leicester? Should be England an underdog to Iceland? Should be Leicester a favourite of EPL?

    Favourites simply lose, even in political props. I think the "remain" should have been much bigger favourite. Favourite or chalk has nothing to do with the outcome.
    We are all bloodsucking ticks, hungry, devious
    each one latched on to the ass of the previous
    when the last and the first latch on it can be shown
    ass-blood sucked by the first from the last is his own

  8. #8
    BetterNick is offline Private Member
    Join Date
    September 2014
    Posts
    57
    Thanks
    5
    Thanked 15 Times in 15 Posts

    Default

    Seem to remember the days before, the betting settled around 30% leave, 70% remain. If you had asked 100 political experts, pollsters etc the day before, I doubt anywhere near 30 would have predicted leave - to that end the bookies actually got it 'right'

  9. #9
    LukeC is offline Non-sponsor Affiliate Program
    Join Date
    October 2012
    Location
    Birmingham, UK
    Posts
    495
    Thanks
    48
    Thanked 122 Times in 49 Posts

    Default

    Bookmakers prices are derived from Betfair. In this case, it was a super strong Betfair market as well - the liquidity was massive throughout. The only view is whether a bookmaker wants to lay or duck a certain side. For example, at the point about a week before when the Betfair odds were 1.57 remain, 2.75 leave, if the bookmaker wants to lay Leave, they will go 7/4; if they want to lay Remain, they'll go 4/7. They won't go out of line and open up an arb as it is essentially giving away money - no-one did during the whole referendum with the exception of one independent.

    The weight of money argument is PR spin really, as "we follow what another market tells us" isn't great to put in the papers and doesn't get many column inches. The bookies should really have accounted for this extra information of the "public money" being for Leave, though, as that's information that wasn't available to anyone else.

    In this case, and particularly on the night, the Betfair prices followed the currency markets (GBPUSD) as well. It was the hedge funds that got it wrong, rather than the bookies. The bookies just followed.

    The main reasons for that were likely a combination of:
    - Consensus was that a higher turnout would be better for Remain than Leave. As turnout expectations increased (the over/under was between 59 - 60.5% two months ago, 68.5% a week or two prior, and about 70.5% on Thursday afternoon), consensus was this would be good for Remain. The opposite was the case.
    - Advance polling was wrong, because a lot of the extra turnout was in areas where people do not usually vote, and they did in this referendum, so they couldn't be polled.
    - No public exit polling, but there was private exit polling by a number of hedge funds - which almost certainly took place in London. London was always going to vote Remain, and indeed overindexed against its expectations. This boosted confidence in Remain and caused it to shorten on the day - as if you are spending a few hundred grand on a private poll, you have to have a lot of money to stake on the verdict. They just seem to have neglected to poll anywhere else, or not accounted for the turnouts varying across areas (the major increases were in Leave areas, rather than Remain areas).
    - Weight of money thanks to vested interest in Remain from city types, who are the ones with the money. Saw a fair few of those sort of people commenting that they did not believe Britain would be stupid enough to vote Leave - based on their personal opinion rather than data.
    You then get badly done private exit polls + preconceived bias towards Remain + huge amounts of money that affect the market...
    - Farage conceding around 10pm - combined with the moves already, that moved the market starkly and is when Remain hit 1.08 (1/12)
    Head of Affiliates at Digital Fuel

  10. The Following 2 Users Say Thank You to LukeC For This Useful Post:

    chaumi (30 June 2016), DanHorvat (29 June 2016)

  11. #10
    BetterNick is offline Private Member
    Join Date
    September 2014
    Posts
    57
    Thanks
    5
    Thanked 15 Times in 15 Posts

    Default

    Interesting analysis, reminded me a bit of the Bush-Kerry election, similar swings in the betting market, that point where the favourites flips is always a bit of a thrill! Actually surprises me TV don't use the betting data more - funny Alex Salmond having Betfair on, DD trivalised it but far more accurate than the pollster wonk.

    Wasn't it about 80m traded? To be honest I thought it would be higher given the length of the campaign. Personally think the Betfair 'sets prices' proposition a bit overdone, aggregate far more would have been 'risked' with FO books so you would expect them to influence price discovery more.

    As you say polls were the main issue - 2015 GE was bad, guess this time they had the excuse of no historical but still poor. If there's so many if's, but's and maybe's to factor you wonder whether they are measuring the immeasurable. Fantastic for journos to form narratives (tracking noise?) and a way to influence 'momentum' by vested interests but wonder if they have any predictive use.

  12. #11
    sweetbet's Avatar
    sweetbet is offline Public Member
    Join Date
    November 2012
    Posts
    2,819
    Blog Entries
    5
    Thanks
    898
    Thanked 1,574 Times in 1,087 Posts

    Default

    It'll be interesting to see the outcome of the U.S. general election based on the odds that the bookies have given Trump & Clinton

  13. #12
    chaumi is offline Private Member
    Join Date
    October 2013
    Location
    East Midlands
    Posts
    822
    Thanks
    185
    Thanked 392 Times in 293 Posts

    Default

    From a punting perspective, all this is a perfect illustration of the concept of looking for value in betting markets, especially in those that can go only one way or the other.

    On the night (and preceding days) - up to when Farage made his defeat concession at least - if you had any appreciation of the social divisions in the UK you could fairly easily see that the result was going to be close. So close in fact that it should have been more like 10-11 stay, 11-10 leave. Debatably even closer to evens.

    So to get whatever it was - 9-2 on the evening? - was (with some small hindsight admittedly) one of the greatest betting opportunities a punter might ever land in his lap. Anyone with the balls could have loaded up...

    There were 2 problems though:

    One being it was a one-off - if it had been a weekly football match where you're getting 4-1 or 9-2 on an 11-10 shot you'd be backing it blind every week and taking the cash off the money tree.

    The other was the shooting in the week - which theoretically should have pushed more votes to remain but apparently didn't (and arguably therein lies what may be the real worry for the UK - the reprehensible nationalistic/neo-racist factor)

    When Farage made the lose concession anyone who hadn't already waded in would probably have caved and decided against it, but again with hindsight there could have been n reasons you could have seen through why he may have done that intentionally.

    From a betting perspective all fascinating stuff..and a few in the know or willing to take a risk will have made a lot of money (in addition to the bookies, and it looks like there was plenty of upside in trading off odds bets with currency trades too)

    If only we could again!!...but of course it would go the other way and 1-7 stay would be about right.
    Last edited by chaumi; 30 June 2016 at 5:03 am.

  14. The Following 2 Users Say Thank You to chaumi For This Useful Post:

    Aidan90 (30 June 2016), DanHorvat (30 June 2016)

  15. #13
    LukeC is offline Non-sponsor Affiliate Program
    Join Date
    October 2012
    Location
    Birmingham, UK
    Posts
    495
    Thanks
    48
    Thanked 122 Times in 49 Posts

    Default

    I laid Remain at 1.11 just after Farage conceded (I did so, having had quite a large position on Leave at around 2.75 from the week before, which was looking horrific, and was looking to recoup a little by trading out when the early seats declared); but the value was once the results started to come in. And most of the time the value was in backing the rumours from the counting halls (many reported on the news channels), all of which were that Leave was doing way better than expected, but the markets early on were very sceptical of it.

    Leave was too big after the early seats declared in the Leave areas and hugely overindexed compared to expectations, as the market was slow to react as it seemed it was waiting for a big London seat to declare, which took longer than expected to happen (London in almost all seats was expected to vote Remain). The main value was that the market took a long time to respond to the turnout not being high enough in the Remain areas - as hardly anyone had modelled turnout. Most people betting the market on the night to significant money would have had at least one set of expected margins for each seat in front of them (such as http://apcoworldwide.com/docs/defaul...e.pdf?sfvrsn=0), but I couldn't find any turnout expectations by seat available anywhere. It was turnout, rather than performance in each seat, that won the referendum imo - although the Remain areas didn't gain quite enough margin in the seats to compensate for some huge Leave swings in smaller seats as well.
    Head of Affiliates at Digital Fuel

  16. #14
    baldidiot is offline Private Member
    Join Date
    January 2010
    Posts
    4,466
    Thanks
    410
    Thanked 2,028 Times in 1,340 Posts

    Default

    Quote Originally Posted by chaumi View Post
    So to get whatever it was - 9-2 on the evening?
    Late in the evening it was something silly like 7/1 iirc
    onlinegamblingwebsites.com - Formally known as goodbonusguide.

  17. #15
    BetterNick is offline Private Member
    Join Date
    September 2014
    Posts
    57
    Thanks
    5
    Thanked 15 Times in 15 Posts

    Default

    Think it got into double-figures after Farage's concession (14+, must be screenshots of the charts) - testament to how mistrusted he is, any other leader had conceded it would have been triple figures. Still think the implied odds were far better than the predictions of journos, pollsters etc God knows if Leave was value - in hindsight people with winning bets always believe they had a value bet
    Last edited by BetterNick; 30 June 2016 at 9:48 pm.

  18. #16
    Aussie is offline New Member
    Join Date
    July 2016
    Location
    East Grinstead
    Posts
    8
    Thanks
    0
    Thanked 2 Times in 1 Post

    Default

    Rumours that betting exchange manipulated

  19. #17
    TravG's Avatar
    TravG is offline Private Member
    Join Date
    September 2008
    Posts
    2,050
    Thanks
    34
    Thanked 178 Times in 130 Posts

    Default

    The odds are not what the bookies think will happen, the odds are what the betting public think will happen. While you can look at opening odds and gauge what the bookies feel the outcome may be, that is not always the case. A bookie makes a line they feel the public will look at and 50% of the public will agree with one side while 50% of the public should agree with the other side. In a perfect world the book only gets the vig, they do not really want to have money on one side or the other, just collect the vig. So while looking at an opening line it is not what the bookies think will happen, it is what the bookies think the betting public will like so that the money falls evenly on both sides.

    In the event of posting a moneyline, like -300 or 1-5 odds, the bookies make the number in hopes that by offering odds it will entice enough people to take the underdog to offset the majority of people taking the favorite. So in the case of say 1-5, they hope 4 people bet the fav and 1 bets the dog to even out the money.

    Many times a bookie will post a line they know is soft because of the betting trend of the public. For example, in Monday Night Football, the favorite is always almost minus 1 to 1.5 points more than they should be because more people bet the fav especially when there is only action on 1 game.
    Live Casino USA - the best USA live online casinos. Play USA online slots and other casino games like USA online blackjack. Like poker? See www.usalegalpoker.com for the best USA poker sites and USA online casinos for the best USA online casino. https://mobileslotslisting.com
    www.usalegalslots.com - www.playusaonlinepoker.com - www.4deucespoker.com

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •