Brett’s Betting Syndicate has worked with us on a number of different packages over many years now. Aside from providing our members with different betting services, they also operate as a betting syndicate in their own right. We often ask Brett to give us an insight into how a betting syndicate actually operates, as people are interested. We’ll publish his insights here.
October 8, 2020
When talking to members you focus a LOT on price. For a betting syndicate, just how important is getting that extra few cents on – for example – a line bet? Can you target bookie promos for that?
Yeah we talked about it recently – TopSport $2 promo lines are gold dust and allow you to have a line bet on most games, even if you’re only two points off the market. Their daily sports boost up to $500 is also very handy. It can’t be used on totals, but you can add 3c to a line bet.
If you can add 3c to the official release price of $1.90 on our bets, you can have it for another unit.
I don’t know and don’t care what other promos there might be around on the AFL. The rest of the corps are muppets with NFI about real trading, and restrict at the drop of a hat. Very likely the promos are a pittance and not worth it. Much credit to TopSport for having the balls to take a bet, no doubt they are lopsided on most games and are taking on substantial trading risk.
If you’ve got the expertise and time to show some patience and “market make” on Betfair, the whole game changes when you are averaging effective $1.98 on your betting.
Fighting tooth and nail on price is one of the key differences between ‘fire and forget’ hobby punting and trying to make a livelihood from trading, like a betting syndicate does.
Even at the highest level, we’ve met a number of UK-based sports traders managing their syndicate’s prices / lines that are sweating on their KPI’s relating to their matched prices. They are purely in a trading execution role, and if they don’t fight hard enough on their core role of securing good prices, they are out of a job.
You pay big for the convenience of a bookmaker always being there as a guaranteed counter-party to your trade request (that’s if they take a bet – most corps don’t). So make Betfair your number one punting friend, and TopSport your number 2 for AFL main markets.
It would appear to be a pretty tough AFL season for many punters, which maybe isn’t surprising with such a bizarre environment for the clubs. Would this also be the case for a large betting syndicate, in your opinion?
The big money players with the most market influence this season are currently getting belted. I’d say there’s 2-3 really big players, and they are not doing that well.
This isn’t so surprising. In seasons with significantly changed states, whether it be AFL or other sports, we’ve seen years where the closing money doesn’t show any ‘form’ at all and runs cold from season start to season end. Usually the explanatory vector is the changed conditions; their pricing solutions are not adjusting quickly enough, and as traders, they are not identifying that they need to show some ‘P&L form’ when navigating through significantly changed conditions.
Also, don’t think of closing money as some kind of monolithic ‘super intelligence’ that cannot be beaten. Once you know who these people are, you can pick and choose your fights quite well. Just who and what the closing money is changes a lot from year to year. Some players do well for a few years, move up in stakes to the big league, get belted for a season or two, and then move back down again. We know for a fact that the big UK syndicates have been playing the AFL for a number of years now.
Why? Because we traded AFL for one of them in 2016, after shopping around the merits of a sport with relatively high liquidity at close, and very low commission exchange trading. We went through a fairly long process of being grilled on our pricing solution by their data science team before we finalised a trading deal based on profit share.
Sounds very interesting… how was that?
That experience was phenomenal.
We essentially became outsourced members of a London based trading team. We got a significant amount of proprietary sports trading education from them. Not to mention a baptism of fire having the green light to market make to up to $80k AUD a game! After ‘trial stakes’ of $8k AUD liability per game for the first eight rounds, we spent the next two-thirds of the season with the all-clear to build positions any way we saw fit to the $80k AUD level per game.
It involved everything you could imagine. We turned into full blown AFL market manipulators. We were nudging Pinnacle the wrong way to deceive onshore bookies (where again, most have no NFI about what the real line should be and thought Pinnacle was the bible) so we could generate huge middles. There was a West Coast / Gold Coast game where we engineered line moves to an absolute tee and hit an $80K AUD middle.
I was personally left to engineer all sorts of different trading situations that favoured us. Whether it hustling onshore bookies with nudging Pinnacle the wrong way, to pre-empting and front running other traders’ moves.
You could see their releases ‘a mile away’ (about 2-3 hours out from the official release). We simply started piggy backing what they did to book easy middling and scalping action.
So a big part of what a bigger betting syndicate does is monitoring the moves of others in the market?
Yep, market profiling was a huge thing for us in 2016. That experience still remains with us to this day.
How did it end up?
We did just shy of $10m AUD trading in 140 games during the ‘live phase’. We were +$100k AUD during the trial phase, and -$500K AUD at the $80k market making level. If the whole season was at the same stakes, we would have made bank. Post 2016 season it was decided the our partners just needed more control over the whole process. We weren’t physically located with the rest of the trading team in London for a larger level of supervision, and our models were our own IP. It was disappointing, but the joint venture wound up.
I probably made about $200k in trading mistakes in season 2016. When you don’t know any better and are operating at nose bleed stakes for the first time, you are going to screw up as you learn. And I was no different. When you get done for $40k AUD by a drip feeding sniper who has inside injury/flu/gastro info, you don’t forget the experience. And you know what it looks like for the next time. I made mistakes in every way: too cautious, panic hedged, over leveraged… the list goes on. I never made the same mistake again, but $200k was paid for that on-the-job training.
If I had my time again, we would have market made a lot less on games, and just ‘lashed out’ in more of a price taking strategy at market close. And I certainly wouldn’t have market made at Matchbook on AFL! Where there was 0% chance of a recreational dollar and just 100% syndicate money picking us off on bad lines.
In terms of everything you’ve observed and the experience you have as a betting syndicate, what might it actually mean for Champion Bets members in future?
I think next year we will go the whole hog and start releasing every day starting on Tuesday. Whether you can get on that early will end up being the main problem. There is a huge drop in class going back to even a Thursday market, Tuesday and Wednesday are even easier.
We wanted a late market service so everyone can get on for large amounts if they wanted with no dramas. But the market at close is just getting tougher every year. I’ll discuss just how tough it is at the end of season review.
I’d rather the client base go into the late market to add some polish on a position that was built early because of early market moves. Some may have no accounts to take advantage of mid-week releases. But I can see overall a much better offering for those than can get on that early.
This kind of thing happens a lot. You would probably see the market is pushing us off bets by our release times (given we show all of our numbers) because the market is moving the right way 90% of the time.
September 16, 2020
We’re trying to get an idea of what a betting syndicate actually does. Speaking to you in the past, I would say – in layman’s terms! – that it’s your job to calculate what the closing line will be, then trade around that to profit. How do you model the closing line on a game?
We’ve been building our capabilities to predict it for a very long time. To summarise that, our line comes from:
- Ten years of modelling experience (eight years full time)
- ~35,000 features (variables)
- Many dozens of different pricing solutions coming together to form a ‘super line’. Everything is a model ensemble (ensemble being a group of models working together)
- We watch everything externally. All the public models, all the time, everywhere
- We backwards-engineer and profile the shading from market makers / market, especially any Betfair shading before our own entry.
So a betting syndicate isn’t about sitting around watching sport all day and taking notes…
No. We often get feedback regarding ‘write-ups’ about an upcoming game. People want to know the rationale for making bets, in terms of the players or teams involved.
Let’s put it in a certain way, because sometimes it’s really difficult to form a bridge between two different worlds and ideas of what punting/trading is really all about:
If we gave you ‘write-ups’, we are personally in serious trouble as a trading organisation. And you should be pulling the pin on following anything we do!
That’s because the idea that you can ‘think your way through’ the closing market is absolute BS. The office is not a scene out of Two For The Money, with savants kicking balls around and talking footy all day.
Closing markets are actually the culmination of a week-long quantitative arms race between a handful of different entities. All of whom are have serious ability in accurate price formation. In this day and age, data science techniques are all the rage and we’re no different.
So are you trying to predict where the line will go based on all the public information you have… as well as what you know about what these other betting syndicates might do?
In a way, we are signal ‘chefs’. We are cooking together models and solutions all the time: internal, external, we don’t care where the signal comes from. We consume and process anything and everything to make the best line possible, by capturing as much information as possible. If you have a favourite public model, chances are if it really has any capacity for being useful, there is a shred of that in our own line.
You spoke above about ‘market makers’ and ‘market shading’. What is that?
Often in markets, there is a ‘market maker’, an entity that acts as a guarantor for a market’s liquidity. Usually that comes with a good deal from the exchange to offset what will happen. Market making is the most thankless task in the punting world.
You will get nibbled on by recreational action until some sharp money comes along and gut punches you. Only when you are wrong! You need to take on ‘toxic liquidity’ (smart money) constantly, and somehow come out of that battle on top.
Often this market maker stands out like dog’s balls, and they will shade their prices to their opinion. For example, instead of dealing 1.94 / 1.94 on the line, they will ‘shade’ 1.90 / 1.98 to entice action on the side they want to take on. Sometimes it can take a fair bit of experience to spot the market maker. Other times they are ‘playing games’, such as early market deceptive shading to confuse their opponents. That higher-level game theoretic stuff happens with the huge markets like the EPL and the big soccer leagues.