Lock! Risk-Free Arbitrage in the Japanese Racetrack Betting Market

Ashiya, Masahiro

doi:10.1177/1527002513493630

Cited by 2 publications

(2 citation statements)

References 15 publications

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“…Such opportunities have been found to be numerous in European soccer betting (Constantinou and Fenton 2013) with the number of opportunities substantially increasing over time (Gomez-Gonzalez and Del Corral 2018), perhaps due to an increase in the number of bookmakers and a reduction in the average overround. Substantial opportunities for arbitrage have also been demonstrated in a variety of other sports including rugby (Buckle and Huang 2018) and horse racing (Ashiya 2015). Some bookmakers are known to deploy strategies to prevent arbitrage betting such as closing accounts and limiting the stake that can be placed on certain markets (Purdum 2019).…”

Section: Biases In Sports Bettingmentioning

confidence: 99%

Profiting from overreaction in soccer betting odds

Wheatcroft

2020

Journal of Quantitative Analysis in Sports

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Betting odds are generally considered to represent accurate reflections of the underlying probabilities for the outcomes of sporting events. There are, however, known to be a number of inherent biases such as the favorite-longshot bias in which outsiders are generally priced with poorer value odds than favorites. Using data from European soccer matches, this paper demonstrates the existence of another bias in which the match odds overreact to favorable and unfavorable runs of results. A statistic is defined, called the Combined Odds Distribution (COD) statistic, which measures the performance of a team relative to expectations given their odds over previous matches. Teams that overperform expectations tend to have a high COD statistic and those that underperform tend to have a low COD statistic. Using data from twenty different leagues over twelve seasons, it is shown that teams with a low COD statistic tend to be assigned more generous odds by bookmakers. This can be exploited and a sustained and robust profit can be made. It is suggested that the bias in the odds can be explained in the context of the “hot hand fallacy”, in which gamblers overestimate variation in the ability of each team over time.

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Section: Biases In Sports Bettingmentioning

confidence: 99%

Profiting from overreaction in soccer betting odds

Wheatcroft

2020

Journal of Quantitative Analysis in Sports

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“…On the other hand, some recent papers have tested different arbitrage strategies in this type of bookmaker betting markets. Vlastakis, Dotsis, and Markellos (2009) find simple betting strategies that provide significant positive returns using data from European Football Betting Markets or Ashiya (2013), who shows arbitrage opportunities in the Japanese Racetrack Betting Market.…”

Section: Behavioral Finance and Betting Exchangesmentioning

confidence: 99%

Behavioral Biases Never Walk Alone

Abínzano

Muga

Santamaria

2016

Journal of Sports Economics

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This article presents evidence of the impact of overconfidence bias in asset prices drawn from a study based on data from tennis betting exchanges. A series of betting strategies in tournaments with a clear-cut favorite are shown to yield significant economic returns. The impact of overconfidence bias on betting odds increases with trading volume, media coverage, and levels of disagreement between overconfident and cumulative prospect theory bettors. Just as in traditional financial markets, arbitrage limits are shown to be a necessary condition for the impact of behavioral biases on prices.

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Lock! Risk-Free Arbitrage in the Japanese Racetrack Betting Market

Cited by 2 publications

References 15 publications

Profiting from overreaction in soccer betting odds

Profiting from overreaction in soccer betting odds

Behavioral Biases Never Walk Alone

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