YARPT

[Borodog]

[ QUOTE ]
[ QUOTE ]
Doesn't that logic imply that you should be able to book an automatic win by selling both HOUSE.DEM.2008 and HOUSE.REP.2008, which together total less than 90?

[/ QUOTE ]
Depending on the vig intrade charges, yes, it does.

[/ QUOTE ]

Assume for simplicity that:

HOUSE.DEM.2008 = 80
HOUSE.REP.2008 = 10

Now if each of these were actually the actual percentage (a bit repetitive and redundent, I know), then your EV calculation to sell would be:

Sell Dem, put up 20 to win 80. Win 80 20% of the time, lose 20 80% of the time.
Sell Rep, put up 90 to win 10. Win 10 90% of the time, lost 90 10% of the time.

EV = 0 in both cases.

Now given that the total is only 90, there is 10% to be allocated somehow. Let's assume the actual percentages are 85% and 15%. Then your EV is:

EV(Sell Dem) = 80(0.15) - 20(0.85) = -5
EV(Sell Rep) = 10(0.85) - 90(0.15) = -5

And in fact you can see that no matter how you allocate the extra 10% you get a total EV betting both ways of -10.

Looks like a guaranteed loss to me, not a win.

I.e. your point remains but the guaranteed win should be to buy, and not sell both sides, right?

EV(Buy Dem) = 20(0.85) - 80(0.15) = +5
EV(Buy Rep) = 90(0.15) - 10(0.85) = +5

Or am I screwing the pooch somewhere obvious?

[iron81]

I think you're right. The guaranteed win is to buy both sides.

[Borodog]

Like I said; your point still remains.

[Borodog]

Aye; there's the rub. To buy both sides immediately you'd have to bid the available ask price, which totals 110. Ask on HOUSE.DEM.2008 = 90, ask on HOUSE.REP.2008 = 20.

[iron81]

You don't have to pay the listed ask price, that's just what you would have to pay if you wanted to buy something right now. You could post offers to buy contracts at the last sale price: HOUSE.DEM.2008 = 80, HOUSE.REP.2008 = 10 and hope someone (probably two someone's) take the bait.

[Borodog]

It would have to be both sides, right? Otherwise your nefarious scheme is fubart. Also, you'd at least have to bid higher than the existing unsold bid prices.

[Money2Burn]

Isn't this middling?

Edit: Except with the added benefit of not losing both bets the small percentage of the time that the team hits the spread exactly.

[Borodog]

Damned if I know. What's "middling"?

[Money2Burn]

[ QUOTE ]
Damned if I know. What's "middling"?

[/ QUOTE ]

I'm not into sports betting so I'm not exactly sure how this works, I've had it briefly explained to me before by some old time sports bettors that I know. Perhaps someone who knows more can fill in the details.

As far as I know it's a strategy people use in sports betting if they can get two spreads for the same game using different bookies. The key is that the spreads be significantly different from each other. Basicly if the two spreads vary in some way you are always going to win at least one bet and it works out to be +EV. Supposedly the internet has made it nearly impossible to do because all the lines are so close now because all the bookies have the same information.

[tolbiny]

[ QUOTE ]
Damned if I know. What's "middling"?

[/ QUOTE ]

Just a sports betting term where you bet on one side of the line expecting it to move so that you can bet the other side leaving you a middle area where you win both bets. Usually you get either a big win (win both bets) or a small loss (the vig on one of your bets).