Betfair Rule 4 / RF / Douvan Fiasco

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Derek27
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Hi Angels15. I remember a really bazaar situation (think it was a maiden) where the 3.0 favourite drifted to about 9. The new favourite was withdrawn at about 2.8 and reduction factors applied. An outsider got backed down to 3.0 favourite and then got withdrawn with RFs applied.

The end result was, anyone who backed the original favourite at 3.0, with two favourites pulled out, would have got odds of 1.03, even though it was now trading between 3 and 4 !!

I think it's technically possible in a very volatile market with a few non-runners to get odds under 1.00 !
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ANGELS15
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Yes! this is one of the 2 risks which come with straight betting on Betfair the other being that you're not protected by the double result guarantee. But back on the subject of rule 4s, yesterday I backed 3 horses for small stakes in the 1.40 Lingfield. I laid each one at 1.33 (lay bets to keep in running). One of the horses 'Bungee Jump' won. According to my screen I should have made a £29 profit on the market. However after a few minutes the market was settled and my balance did not go up at all. I rang Betfair and spoke with some guy who sounded like he was in Malta or possibly Gibraltar. He insisted that I hadn't allowed for the bets on the orher horses. I was trying to explain that my profit was after all that (i.e a green up). Anyway the discussion was to no avail. I then heard in the background on SIS a commentator mentioning 'the horse that was withdrawn....rule 4 to follow'. I then realised it was likley that their rule 4 had killed my profit.

I've seen Betfair reform the market before the off when something's been taken out, it would seem on this occasion it must have been a very late withdrawall.
DegenerateTrader
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This is taken directly from Betfair;

· Betfair's non-runner rule relates to the adjustment of odds on bets already matched when a horse in a race is declared a non-runner. In order to make the adjustment Betfair applies a reduction factor to the remaining runners. The reduction factor allocated to a non-runner is a calculation (the details of which are described below) of that horse's chances of winning (or being placed, etc as appropriate) and is applied to bets already matched on the other runners in the relevant market or markets.

· When the market is loaded each horse is given a 'reduction factor', based on a forecast price, which is expressed as a percentage. These reduction factors may be updated periodically at the discretion of Betfair based on trading in the market, but after approximately 15 minutes (approximately 5 minutes for Australian markets) from the scheduled 'off' time of a given race, they will be updated only in exceptional circumstances. The current reduction factor percentage for each horse can be viewed on the 'info' page on the Betfair website or by asking the Helpdesk.

13.6 How the Reductions are applied

· In the win market, reductions will be made on the traded price.

· For example: if the non-runner's final reduction factor is 25% the traded price on all previously matched bets on other horses will be reduced by 25% - traded price of 8.0 would become 6.0 etc. And these might be further reduced if another horse is subsequently declared a non-runner.

· In the place market, reductions will be made to the potential winnings on the bet only, and not the traded price.

· For example: if the non-runner's final reduction factor is 25% the potential winnings on all previously matched bets on the other horses will be reduced by 25% - a traded price of 8.0 would become 6.25. For example a £10 bet on a horse to be placed at a traded price of 8.0 would provide winnings of £70. If there is a non-runner with a reduction factor of 25% in the race, that factor will be applied to the £70 of potential winnings leaving potential winnings of £52.50. Therefore the revised traded price will be 6.25.

· The traded price may be further reduced if any other horse(s) is subsequently declared a non-runner, however odds cannot be reduced below 1.01.

So the figure they come up with is at Betfair's discretion - no one could have reasonably known what his final RF would have been in the morning, so when I stopped trading and had my green book I was legitimately in a strong position, and fell victim to their "discretion".

Is there anyone knowledgeable enough that could form an opinion on what Douvan's realistic % of winning that race was if he was declared? Is 20% accurate?

I think I'll get in touch with them early next week and try and sort this out.
spreadbetting
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You posted up a link from Boyle sports with the odds at 4/1 so 20% was a reasonable reduction factor to open the market with.

Did your withdrawal manage to hit your bank account.
DegenerateTrader
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spreadbetting wrote:
Sat Mar 17, 2018 9:33 pm
You posted up a link from Boyle sports with the odds at 4/1 so 20% was a reasonable reduction factor to open the market with.

Did your withdrawal manage to hit your bank account.
It's irrelevant what his opening price was, what's important is the final factor they applied at 10am on the day. I seriously doubt he kept his 20% chance given he raced less than 24 hrs before.

Yeah, it went through before the race started.
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Derek27
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DegenerateTrader wrote:
Sat Mar 17, 2018 9:24 pm
So the figure they come up with is at Betfair's discretion - no one could have reasonably known what his final RF would have been in the morning, so when I stopped trading and had my green book I was legitimately in a strong position, and fell victim to their "discretion".

Is there anyone knowledgeable enough that could form an opinion on what Douvan's realistic % of winning that race was if he was declared? Is 20% accurate?
I was discussing his RF with Shaun in the early hours on the Cheltenham thread.

viewtopic.php?p=146642#p146642

Nobody can reasonably know what any horse's RF will be if it's withdrawn - when I used to lay the field I lost and gained money when horses are withdrawn due to price fluctuations and resulting RF changes, it's something you have to consider when laying or dutching a day-of-race market.

Everyone will have their own opinion of what Douvan's chances would have been if he ran. As I said previously, no reduction factor will please everyone - some will gain and some will lose whatever figure they come up with. But 20% was advertised so if the amount you placed on Douven is less than 20% of your total you have to tread carefully.

You need to remember there may have been people laying the field for an overround of 98% after calculating their position after Douven is removed from the market - they will also feel they had legitimate positions.

I wish you the best in resolving what I know must be a difficult position with Betfair.
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Derek27
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DegenerateTrader wrote:
Sat Mar 17, 2018 9:56 pm
It's irrelevant what his opening price was, what's important is the final factor they applied at 10am on the day. I seriously doubt he kept his 20% chance given he raced less than 24 hrs before.
I don't follow horse racing closely any more, but it could be argued that the fact that he ran 24 hours earlier, to some extent, is mitigated by the opinion that he looked as though he could be near back to his best, was travelling powerfully and may not have had a hard race. If he did run it would be presumed that Willie Mullins feels he's ready, as only the trainer can really know. Would people want to lay him at 7.0?
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Derek27
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LeTiss wrote:
Sat Mar 17, 2018 8:10 am
I learned this myself a few years back when I dutched a broken book when the World Darts had reached the QF. There were 8 runners and the book was at 99%, so I happily dutched away, locking in a green of £60. However, when 4 of those players got eliminated my BF bank showed -£350! I still made the £60 after the tournament, but the exposure on the 4 eliminated players left my bank in arrears, so I had to put more money in to cover that bank, so I could trade again.
I had that issue a few years ago on Cheltenham antepost markets. You're safe if you lay an antepost market for a green book, obviously non-runners don't affect antepost markets. The problem is when you dutch the entire market, for reasons best known to Betfair (or perhaps not), they remove liability offset at the declaration stage and you have a massive exposure even though you have a green book and can't lose anything. I had to put a grand into my account on the eve of the festival to carry on trading.
DegenerateTrader
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Derek27 wrote:
Sat Mar 17, 2018 10:29 pm
DegenerateTrader wrote:
Sat Mar 17, 2018 9:56 pm
It's irrelevant what his opening price was, what's important is the final factor they applied at 10am on the day. I seriously doubt he kept his 20% chance given he raced less than 24 hrs before.
I don't follow horse racing closely any more, but it could be argued that the fact that he ran 24 hours earlier, to some extent, is mitigated by the opinion that he looked as though he could be near back to his best, was travelling powerfully and may not have had a hard race. If he did run it would be presumed that Willie Mullins feels he's ready, as only the trainer can really know. Would people want to lay him at 7.0?
That's a fair point however he had certainly drifted out since his fall. You would assume your average punter would naturally lay him when they heard he wasn't running on Wed night. Lots of angles involved.

I didn't see much laying of the field while I was involved(easy to tell through the software).

What did Chapman say about the bookies as I wasn't watching the broadcast? The only bookie that applied Rule 4 was Bet365 and they got a fair bit of heat over it.
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Derek27
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Why would the average punter want to lay him if they know he's not running ?

They know they won't win anything as the bet will be voided and it would needlessly lock up their funds until he's withdrawn.

It's impossible to tell if someone's laying the field! Unless your software is psychic it will only know how much has been laid on each horse. There's know way of knowing whether lay offers are from the same layer or different individuals.

Matt Chapman slammed the bookies for shortening his price before withdrawal so they could deduct a higher percentage of the winners payout when rule 4 is applied.
DegenerateTrader
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Derek27 wrote:
Sat Mar 17, 2018 11:27 pm
Why would the average punter want to lay him if they know he's not running ?

They know they won't win anything as the bet will be voided and it would needlessly lock up their funds until he's withdrawn.

It's impossible to tell if someone's laying the field! Unless your software is psychic it will only know how much has been laid on each horse. There's know way of knowing whether lay offers are from the same layer or different individuals.

Matt Chapman slammed the bookies for shortening his price before withdrawal so they could deduct a higher percentage of the winners payout when rule 4 is applied.
I'm sure the was a few mugs who logged on to lay him when they heard, pointless as it may be. Perhaps I'm wrong.

You could tell by the simultaneous flashing of the odds on one side of the book. You could see there were others beside myself doing this on the back side. It would be impossible to tell if the market activity was hectic but it quietened down overnight.
DegenerateTrader
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Also, overround occasionally came back over 100%, but was typical under.
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Derek27
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Very few people, even people new to betting/trading wouldn't know that bets are refunded on non-runners. If they didn't they would very quickly find out that's the case the first time they lay a non runner so I doubt that would have had much effect on his price. It's quite normal for overrounds to fluctuate so if it's generally 98% it's bound to hit 100% at some point.
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Derek27
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Derek27 wrote:
Sat Mar 17, 2018 4:51 pm
I think it's technically possible in a very volatile market with a few non-runners to get odds under 1.00 !
Just to correct myself, the Betfair rules that DegenerateTrader posted confirms that although it's possible for the reduction factor calculation to reduce a horses odds to below 1.00, the absolute minimum odds you get is 1.01.

Not much comfort if you get caught up in a bazaar market but at least you can't back a winner and still lose!
spreadbetting
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DegenerateTrader wrote:
Sat Mar 17, 2018 9:56 pm
spreadbetting wrote:
Sat Mar 17, 2018 9:33 pm
You posted up a link from Boyle sports with the odds at 4/1 so 20% was a reasonable reduction factor to open the market with.

Did your withdrawal manage to hit your bank account.
It's irrelevant what his opening price was, what's important is the final factor they applied at 10am on the day. I seriously doubt he kept his 20% chance given he raced less than 24 hrs before.

Yeah, it went through before the race started.
The reduction factors aren't like a rule 4 that continually track the price. It's basically a forecast odds and if it changes drastically Betfair alter their odds, the same as the bookies forecast 4/1 as an opening price so did Betfair. A swing of 6% would not be considered enough of a swing for Betfair to change the reduction factor especially as those type of movements can occur all the time once betting really starts. If your basis for arguing against paying is the fact their reduction factor was not in line with the price you've no chance.

I think your only chance of avoiding the debt, or losing your account, is to play on the fact they let you build up a liability larger than your deposit. Allowing you to do that must be against some gambling regulations somewhere and the regulators/gamcare etc wouldn't look favourably on Betfair if they try to recover a debt over your account deposit.

At the end of the day you must have realised the horse was likely to be withdrawn, did you simply think no one else had spotted it and were giving out free money. Surely you must have known some deduction would take place and you only have to click on the graph to see what reduction is going to take place. I remember it happened years ago on a cricket market and they let the guys off the debt and were supposed to change the system to stop it re-occurring. I doubt you're the only one that got caught out so may be worth posting on the betfair forum itself see if there are others in the same situation as a precedent had been set plus they dont like bad publicity. If you play your cards right I'd guess you'll get away with it but arguing their reduction factor was wrong isn't the way to go about it.
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