Algorithm Betting

Due to the current recession many gamblers are preferring to play in an online casino rather than travel to a regular casino.  Online casinos create a realistic player experience of their casino games and are rumoured to offer players better odds of winning.

Profit in the betting industry, just like all other financial markets, is a function of risk, knowledge and pricing power . These three elements combine to determine the proft of all market participants.  

Knowledge and pricing power are more commonly understood.  Having greater knowledge than the market gives you an edge.  This may be in the form of faster TV pictures of a sports event or a skill to read your opponents’ bluff in texas hold-em poker.  Pricing power within a market also offers rewards.  This is evidenced by William Hill and Ladbrokes charging punters through the ‘overround’, a price above fair-value odds.  Borrowing terminology from microeconomics, the supply of bets lacks perfect competition and hence these companies earn abnormal profits in the long-run. Read the full article

This post is not about betting but I need to vent my anger at the UK and US government latest attempt at ‘magic’, a.k.a. quant-easing. Those of you who follow betting may be interested in the concept of ’something for nothing’ and so this post may be of interest.

When David Blane levitated an inch from the ground, it was impressive. But it was, of course, magic; a trick. “Yeah, David, that’s good and i’ve not seen it before, full marks. But, if you really could fly, you’d shoot off in to the air. Now, if you don’t mind, I was on my way to buy the latest edition of ‘Hello’, ‘TVKwik’ and ‘I’m in a stupified coma fed only by media tripe and kept alive by the knowledge that when I feel down I can always go shopping and buy something shiny’. See you next time”. Read the full article

The performance of the Funds are now beginning to take shape. At the end of February, the Championship Fund is up 118%, Premier League Fund up 48% and the Trading Fund up 408%. Most of the gains in February have come from Championship tips including yesterday’s tips to back Notts Forest at Reading and Plymouth at Wolves.

Whilst the gains in the Premier League Fund may not seem as impressive as the other Funds, it does have the highest Sharpe Ratio at 2.16, by virtue of it’s low volatility month to month. Having said that, the Championship volatility is mostly high due to the Fund volatility being calculated from just 2 months.

This weekend’s results have driven the Championship Fund to a new high of 142.70, a gain of 42.7% since the start of the season. The backtesting had promised great things for this Fund with gains in excess of those of the Premier League Fund. However, the Fund had spent a lot of the season under water. The model has a tendency to back the underdog and with recent wins for Ipswich at QPR, Barnsley at Swansea and more notably Doncaster at Sheffield United the Fund has very quickly risen to meet those early expectations. Read the full article

With the second half of the season now well under way and just 5 points separating those in the bottom half of the table, which three teams will eventually face the drop? After a great start to the season, Hull seem to be going backwards. Tottenham on the other hand started badly but have lifted themselves out of the bottom 3. But who has the legs to make it to the end?

The following table shows the algorithm’s view of team strength. The number of points represents the ‘power’ of a team. The higher the points, the stronger the team. Hull may still have a league ranking of 9 but this is mostly from their great start. They’re actually languishing near bottom in terms of team strength with just 17.27 points versus Totttenham with 63.60. Read the full article

With losses showing for all 3 Funds for October i’m already looking forward to November’s games.  But before then I guess I should try and reflect on the month gone.  It’s not great looking back on a losing month but it may be useful if it can highlight any obvious errors or show it was just part of the randomness of results.

Firstly, a word on Harry’s move to Spurs.  I’ve always believed Harry Redknapp was ‘pound for pound’ the best manager in the Premier League.  Only Martin O’Neill comes close.  If you’re a Chairman in need of silverware and don’t speak Russian then Harry’s your man.  Expect to see some new faces at White Hart Lane come January and forget 40 yard cross-field balls or Cinderella turns.  Harry will build a team of strong, technically gifted players who earn their money and play for the team, not for the glory.  Good luck Harry and good luck to Tony Adams back at Fratton Park.

Read the full article

It’s been a very profitable month for all 3 of the Algorithm Betting Funds.  Especially pleasing is the performance of the Championship Fund which had a poor start but has returned to the excellent form it showed in backtesting.  The gains in the Fund prices for September are 59% for the Championship, 35% for the Premier League and 81% for the Trading Fund.

The Trading Fund flew through the hurdle of trebling its starting price with gains to date now standing at 266%.  The Premier Fund also now approaches its first hurdle of a doubling in price; the Fund is currently on gains of 94%.  Both of these funds have been operating for around half a season.  The Championship Fund is yet to pass 2 months old and currently stands on gains to date of 23%. Read the full article

It’s taken 7 weeks of games to come home, but come home it did.  Courtesy of Taylor-Fletcher and a 0-1 away win for Blackpool at Birmingham, the Championship Fund was boosted by 35%.  The odds were 9.6 and the Fund wagered just over 4% after calculating the odds offered 82% value.  Along with other winning bets this weekend the Championship Fund has moved into a positive position overall.  We’ll see over the coming weeks whether it’s a case of one leap forward followed by many small steps back.  It would be nice to stay above water before the next big win comes in.

By contrast the Premier League Fund fell back this weekend mainly due to losses on Liverpool and Pompey.  It does however remain ahead for the month of September.  The portfolio theory of running more than one fund is working well with any significant moves in one fund being offset by the other.  With just one week of games left in September i’m hoping the Trading Fund will break through the hurdle of 200% gains.