{"title":"Efficient Spread Betting Markets: A Literature Review","authors":"Jonas Vandenbruaene, M. D. Ceuster, J. Annaert","doi":"10.1177/15270025211071042","DOIUrl":null,"url":null,"abstract":"Are simple trading strategies profitable? It is a question that has been on the minds of academics and practitioners for decades. In this paper, we review the longstanding literature on trading strategies in spread betting (also known as handicap betting), a popular sports betting microstructure. We review over 600 strategy implementations and find that market efficiency and systematic misperceptions are not mutually exclusive per se. Predictable glitches occur, but they are too small to be profitably exploited which is consistent with efficient markets. Furthermore, while controlling for data mining issues is becoming mainstream in finance, it has not yet made its way into this literature. We provide evidence that the hurdle rate of |z| > 3 which has been put forward in the broader finance literature should also be used in betting market research.","PeriodicalId":51522,"journal":{"name":"Journal of Sports Economics","volume":null,"pages":null},"PeriodicalIF":1.8000,"publicationDate":"2022-02-18","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"2","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Journal of Sports Economics","FirstCategoryId":"96","ListUrlMain":"https://doi.org/10.1177/15270025211071042","RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q2","JCRName":"ECONOMICS","Score":null,"Total":0}
引用次数: 2
Abstract
Are simple trading strategies profitable? It is a question that has been on the minds of academics and practitioners for decades. In this paper, we review the longstanding literature on trading strategies in spread betting (also known as handicap betting), a popular sports betting microstructure. We review over 600 strategy implementations and find that market efficiency and systematic misperceptions are not mutually exclusive per se. Predictable glitches occur, but they are too small to be profitably exploited which is consistent with efficient markets. Furthermore, while controlling for data mining issues is becoming mainstream in finance, it has not yet made its way into this literature. We provide evidence that the hurdle rate of |z| > 3 which has been put forward in the broader finance literature should also be used in betting market research.
期刊介绍：
Journal of Sports Economics publishes scholarly research in the field of sports economics. The aim of the journal is to further research in the area of sports economics by bringing together theoretical and empirical research in a single intellectual venue. Relevant topics include: labor market research; labor-management relations; collective bargaining; wage determination; local public finance; and other fields related to the economics of sports. Published quarterly, the Journal of Sports Economics is unique in that it is the only journal devoted specifically to this rapidly growing field.
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