Are sports markets like financial markets?
Yes and no. There are some similarities, most certainly in a number of aspects. Forex markets are pretty similar in their appearance. But when it comes to trading certain types of markets, there are many differences.
When I first looked at the markets I thought there may be some commonalities, but I discovered that a number of popular technical indicators in financial markets just don’t wash as well in sports markets. Looking closer, there are some clear underlying reasons for this.
Sports markets are very reliant on underlying activity, there is a definite cause and effect on odds. While sentiment can drive prices higher or lower, too high or too low creates an arbitrage opportunity for anybody who has studied or analysed the markets well enough. Sentiment can only go so far in pushing the prices around before arbitrage against well established models limit certain types of price movement. One of the biggest differences though, is that in a betting market all prices are directly related. The same can’t be said of the financial markets which rise or fall based upon their mood that day. Ice cream sellers and umbrella manufacturers can rise and fall together in the short term even if the weather is sunny, on sports markets that’s impossible.
All prices are related on a sports market so you can’t get a permanently rising price without something adjusting elsewhere. No technical indicator will tell you that a horse has bolted to the start, is refusing to load or is being gambled. Using technical indicators in-play is a complete nonsense as in-play odds are determined by the underlying event and the time left to finish. What would I recommend? Lots of things, but keeping an eye on general market activity is one of the most useful indicators. Keeping an eye on non techincal indicators is a definite advantage, staring at some complex indicator that is designed for a different market and can’t possibly work on a sport, not so helpful.
This is one of the reason we introduced the market overview screen. It allows you to see market wide activity at a glance and quickly spot anything that could be having an effect on your current position. Something that’s critically important given the characteristics of a modern sports market.
Category: Using Bet Angel
