Questions tagged [betting]
The betting tag has no usage guidance.
19
questions
3
votes
2
answers
414
views
Determining bet sizes given odds
Recently, I was asked the following question in an interview with a prop trading firm.
You are given the opportunity to make money by betting a total of 100 bucks on the outcome of two simultaneous ...
- 133
0
votes
0
answers
55
views
Combination of bid ask of two instruments
You have 2 instruments: X in which you are quoting 35 @ 40 and product Y in which you are quoting 15 @ 30. We want to make a market on the product X+Y. What is the bid-ask spread you will quote?
Got ...
- 53
0
votes
0
answers
65
views
Incorporating Market Prices into Betting Models
In betting models, the price offered by the market is often ignored until the end. However, it seems like the price is a valuable piece of information that cannot be overlooked. Consider a ...
- 101
0
votes
0
answers
176
views
Bet sizing to actual orders
At chapter 10.2 in Advances in Financial Machine Learning it says:
Suppose that one strategy produced a sequence of bet sizes $[m_{1,1}, m_{1,2}, m_{1,3}] = [.5, 1, 0]$, as the market price followed ...
- 1
1
vote
1
answer
150
views
To gamble or not to gamble! (solving a system of ODEs maybe?)
Assume we have some money. At every point in time $0\le t \le T$, we can take either action 1 that is to keep our money until $T$ say in a bank and have an expected return of $f(t)$ or take action 2 ...
user57062
2
votes
1
answer
702
views
Kelly Criterion for Multiple Simultaneous Correlated Bets [closed]
I am looking for an equation for the optimal fractional bet sizing for N number of simultaneous correlated bets.
I am looking specifically for an equation for binary bets, but an equation for bets ...
3
votes
2
answers
431
views
Kelly Criterion — maximize expected value and minimize the variance in card game with $x$ red and $y$ black cards
You have $x$ red cards and $y$ black cards. I flip them over one at a time. The probability of flipping a particular colour is proportional to the amount of those coloured cards left. You start with $...
- 165
1
vote
1
answer
798
views
Alternatives to Kelly Criterion
I am preparing for Quantitative Trading interviews and I know that they basically require you to solve problems on the probability of winning in a given game and then they would ask you:
How much ...
- 165
1
vote
1
answer
315
views
Dice question - expected winnings of rolling dice $2$ times
Typical trading interviews consider gambling problems such as rolling a dice and winning its face value. The expected winnings are $\\\$3.5$, $\\\$4.25$, $\\\$\frac{14}{3}$ for one throw, two throws, ...
- 113
-2
votes
1
answer
289
views
Trade anything?
I have a question after reading the post below.
https://www.onlinebetting.org.uk/betting-guides/can-you-bet-on-anything-you-want.html
Question:
I want to bet on a niche topic or asset or anything that ...
1
vote
0
answers
86
views
is the concept of skew observed in fixed odds betting markets?
Bear with me if this sounds a little flippant, but this has got me curious. I know "sports arbitrage" is an active economic activity, although the arbitrage arguments, I think, are not ...
- 111
1
vote
1
answer
100
views
What happens to the stake of a lay bettor on a betting exchange?
As an example, let’s say you want to lay a horse at 3.40. To win £10 your liability would be £24. In other words, you are offering odds of 3.40 to someone else who is backing the horse to win with a ...
- 13
1
vote
2
answers
502
views
How much shall we bet on head/tail with $1m bankroll?
I was asked this question in a trading interview:
how much would you bet in a game where you win 300 on tail and loses your 100 on heads? how much will you bet if you can play game once or multiple ...
- 31
0
votes
1
answer
245
views
What's the expected value of a repeated game with 50% chance to win 0.5 and 50% to lose 0.5?
Assume we start with 1.
In the first bet the expected value of remained balance is 1.5 * 0.5 + 0.5 * 0.5 = 1
For N times, is it still 1 according to E(XYZ)=E(X)E(Y)E(Z)?
But 1.5^50 * 0.5^50 is not 1.
...
- 1
4
votes
2
answers
356
views
What is the priority of the waiting non-matched bets, when a match becomes available in Betfair?
Say the back price (odds) on a market is $2.5$.
Then the following time sequence happens:
Bettor $A$ places a back bet with price $2.6$, for $\$100$ (it will not match)
Then bettor $B$ places a ...
- 141
5
votes
1
answer
228
views
How is the "probabilities sum to $1$" rule enforced in betting exchanges?
Suppose that I am interested in a market on a betting exchange for the outright winner of some event, with three competitors, $A, B$ and $C$ with corresponding probabilities of winning $a, b$ and $c$. ...
Alex Seaton
3
votes
1
answer
1k
views
Which sports are generally the best for trading on betting exchanges for a profit?
I am looking at trading bets on tennis, football and horse racing in particular as these appear to have the most liquidity.
How much background research and how much trial and error is generally ...
- 41
8
votes
5
answers
9k
views
Predicting price movements on a betting exchange
On a betting exchange the price (the odds that an event will happen expressed as a decimal, 1/(percentage chance event occurring) of a runner can experience a great deal of volatility before the event ...
- 181
23
votes
4
answers
8k
views
The application of quantitative finance in sports betting
I notice that, on the surface, there are some similarities between quantitative sports betting and quantitative finance. Both have the concept of arbitraging, etc.
What are the applications of ...
- 1,251