IDEAS home Printed from https://ideas.repec.org/p/arx/papers/1901.03645.html
   My bibliography  Save this paper

Evaluating betting odds and free coupons using desirability

Author

Listed:
  • Nawapon Nakharutai
  • Camila C. S. Caiado
  • Matthias C. M. Troffaes

Abstract

In the UK betting market, bookmakers often offer a free coupon to new customers. These free coupons allow the customer to place extra bets, at lower risk, in combination with the usual betting odds. We are interested in whether a customer can exploit these free coupons in order to make a sure gain, and if so, how the customer can achieve this. To answer this question, we evaluate the odds and free coupons as a set of desirable gambles for the bookmaker. We show that we can use the Choquet integral to check whether this set of desirable gambles incurs sure loss for the bookmaker, and hence, results in a sure gain for the customer. In the latter case, we also show how a customer can determine the combination of bets that make the best possible gain, based on complementary slackness. As an illustration, we look at some actual betting odds in the market and find that, without free coupons, the set of desirable gambles derived from those odds avoids sure loss. However, with free coupons, we identify some combinations of bets that customers could place in order to make a guaranteed gain.

Suggested Citation

  • Nawapon Nakharutai & Camila C. S. Caiado & Matthias C. M. Troffaes, 2019. "Evaluating betting odds and free coupons using desirability," Papers 1901.03645, arXiv.org.
    • Handle: RePEc:arx:papers:1901.03645
    as

    Download full text from publisher

    File URL: http://arxiv.org/pdf/1901.03645
    File Function: Latest version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Dominic Cortis, 2015. "Expected Values And Variances In Bookmaker Payouts: A Theoretical Approach Towards Setting Limits On Odds," Journal of Prediction Markets, University of Buckingham Press, vol. 9(1), pages 1-14.
    2. Colantonio Emiliano, 2013. "Betting Markets: Opportunities For Many?," Annals of Faculty of Economics, University of Oradea, Faculty of Economics, vol. 1(2), pages 200-208, December.
    3. Ian Milliner & Paul White & Don J. Webber, 2009. "A Statistical Development of Fixed Odds Betting Rules in Soccer," Journal of Gambling Business and Economics, University of Buckingham Press, vol. 3(1), pages 89-99, April.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jaume García & Levi Pérez & Plácido Rodríguez, 2017. "Forecasting football match results: are the many smarter than the few?," Chapters, in: Plácido Rodríguez & Brad R. Humphreys & Robert Simmons (ed.), The Economics of Sports Betting, chapter 5, pages 71-91, Edward Elgar Publishing.
    2. Philip W. S. Newall & Dominic Cortis, 2021. "Are Sports Bettors Biased toward Longshots, Favorites, or Both? A Literature Review," Risks, MDPI, vol. 9(1), pages 1-9, January.
    3. Axén, Gustav & Cortis, Dominic, 2019. "Extending the price constraints of betting markets," Journal of Behavioral and Experimental Finance, Elsevier, vol. 23(C), pages 181-188.
    4. Arne Feddersen & Brad R. Humphreys & Brian P. Soebbing, 2020. "Casual bettors and sentiment bias in NBA and NFL betting," Applied Economics, Taylor & Francis Journals, vol. 52(53), pages 5797-5806, November.
    5. Carlos Gomez-Gonzalez & Julio del Corral, 2018. "The betting market over time: overround and surebets in European football," Economics and Business Letters, Oviedo University Press, vol. 7(4), pages 129-136.
    6. Hofer, Vera & Leitner, Johannes, 2017. "Relative pricing of binary options in live soccer betting markets," Journal of Economic Dynamics and Control, Elsevier, vol. 76(C), pages 66-85.
    7. Buhagiar, Ranier & Cortis, Dominic & Newall, Philip W.S., 2018. "Why do some soccer bettors lose more money than others?," Journal of Behavioral and Experimental Finance, Elsevier, vol. 18(C), pages 85-93.
    8. Gustav Axén & Dominic Cortis, 2020. "Hedging on Betting Markets," Risks, MDPI, vol. 8(3), pages 1-14, August.
    9. Charmaine Barbara & Dominic Cortis & Roberta Perotti & Claudia Sammut & Antoine Vella, 2017. "The European Insurance Industry: A PEST Analysis," IJFS, MDPI, vol. 5(2), pages 1-20, May.
    10. Ge, Qi, 2018. "Sports sentiment and tipping behavior," Journal of Economic Behavior & Organization, Elsevier, vol. 145(C), pages 95-113.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:arx:papers:1901.03645. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: arXiv administrators (email available below). General contact details of provider: http://arxiv.org/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.