Profiting from reading the markets

One of the many benefits of trading football markets on the exchanges is that there is usually a knowledgeable pool of people forming an opinion as to how a match is playing out, reflected in the prices being traded. An excellent example of this occurred during the UEFA League match a couple of nights ago between AZ Alkmaar and Austria Vienna.

I'm not very knowledgeable about either Dutch or Austrian soccer, although I do trade both leagues occasionally, but I'm prepared to trust the collective opinion of other traders to an extent. Vienna were two goals to the good at half time, yet were trading at 1.46. The price offered is substantially odds on - and the market is proposing that Vienna have a 68% chance of winning the match. Therefore it follows that the draw and a home win between them represented a 32% chance / probability. Put it another way, 2/3 Vienna 1/3 the field.

A quick check of the graphs showed that AZ were easily the pre-match favourites, trading at about evens with Vienna at around 4. So here we are, half way through the match, and the dogs are two up away from home. To my mind, despite the mathematics in the above paragraph, Vienna were a value lay in this situation. I laid them for £50 at 1.46 with a liability of £23. The reason I concluded thus is that 1.46, in my opinion is too high a price to indicate a market totally convinced that the outcome is anywhere near certain. I didn't look, but I'd be reasonably confident that 2-2 would have been trading no higher than about 20. If that was the case then I might have doubled up my lay or have stuck a tenner on 2-2!

I suppose it's easy sitting here writing this secure in the knowledge that AZ did, indeed, pull the match back to 2-2. Theses trades don't always work - and I normally only lay two goal leads if the price is substantially lower than it was in this case.

The key point in this trade, to me anyway, was that the market was far from convinced by the current situation. Admittedly it took Alkmaar longer than I would have liked to score the first goal and it required a bit of a leap of faith to stay in - but I couldn't green up anyway - and I hate taking small reds when I'm convinced a nice green is around the corner. Some people reading this will be thinking 'the silly old s*d's punting again'. And they'd probably be right. But - trust the market and long term I suspect us old trapunters will be ok!