But the bookies undercut Betfair in the big political markets

Let’s hope that more than a few Politicalbetting.com users were able to take advantage of the Bet365 UK General Election seat price market yesterday which one reader described as “absurd”. As we pointed out in the Monday Call, the prices were completely out of alignment with what other bookmakers and the betting exchanges were doing and, indeed with what they themselves were offering in the main General Election market. The changes are:-

Conservatives to win 245+ seats DOWN from 3.5 to 2.5

Lib Dems to win 61+ seats price DOWN from 2.6 to 1.9

Labour overall majority at under 51.5 seat DOWN from 2.5 to 1.9.

Thus for most of yesterday you could get 3.5 on the Tories getting 245 seats – which was exactly the same price as Bet365 was offering on them to win the General Election for which they needed at least 50 more seats. That was a no-brainer. All these were good value bets – but now they are much less so particularly as you would be locking up your money for nearly a year and a lot can happen in the intervening period.

Bookies compete with the exchanges on price

Meanwhile the conventional bookmakers such as William Hill and Ladbrokes have made no secret of their hostility to the betting exchanges where gamblers can be both backers and layers and the prices are determined by punters matching up with one and other resulting, usually, in better value odds. The bookies have tried political pressure, a PR war and now, in the political markets at least it seems, more aggressive pricing.

Further indication of this is that William Hill are now offering 1.83 on George Bush to be re-elected – odds that put them ahead of all the other online bookies and the betting exchanges.

This means that for the odds-on favourites in the three biggest political betting markets – the UK General Election, the US Presidential election and the Labour Leadership – William Hill have a significant price advantage over the betting exchanges, which if you read their blurb, should not be.

On Thursday we recommended that punters took advantage of the 1.4 that William Hill had on Labour for the General Election; the following day the bookmaker was beating the exchanges with its 1.53 price on Tony Blair still being Labour leader on General Election day; and now comes the George W. Bush price.

After our recommendation the Labour General Election price has slipped back to 1.36 but William Hill still leads the pack and is offering better value than Betfair, and that is without taking into account the 5% commission on winnings that Betfair charge.

We do not know whether this is a deliberate strategy by the bookmaker but a pattern has now become clear and it has only emerged in the past week or so.

The bookmaker seems to have chosen to be highly competitive on price in long-term markets where betting exchange prices can be unresponsive because many punters are in for the short-term not the eventual outcome of the market. When circumstances change many exchange gamblers do not look at the overall picture – just whether they can turn a profit on their short-term positions.

What this means is that in these long-term markets bettting exchange punters might have to take a slightly worse price on the exchanges so they can have the flexiblity, the ability to punt on short-term price movents and the potential to get out of a market easily.

Whatever the competition is good news for punters.

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