Syndicates quiet ahead of Word Cup: Why?

2014-06-05

Due to the nature of Asian and European betting markets, in order to maximize profitability professional betting syndicates must time when they place a bet. Syndicates crave access to high betting limits from bookmakers or deep liquidity from betting exchanges, which will allow them to place bets in the required size.

Bookmakers limits are highest when all information is available to the market, hence on match day, close to kick off or for a major sporting event. These are all scenarios when professional punters will be allowed to stake the largest amounts.  Bookmakers can set limits even higher when a match is switched to “in play” and live bets are accepted. The size of limits can also be referred to as the liquidity of the market.

An interesting situation has occurred recently during the high number of international friendlies played over the past weeks in the build up to the World Cup. This anomaly relates directly to market liquidity and how this liquidity varies depending on the nature of the fixture. In this case the different market liquidity scenarios for a non-World Cup match as opposed to a World Cup match.

All major global betting syndicates would by now have a clear idea of where they want to be positioned in their World Cup rating for each team. There is no doubt they could have easily applied this statistical superiority and been active in recent international match markets, to captured significant profit. There was clearly value in the market on some matches as player outs, motivation and doubts were in abundance. The amount of soft money on the popular favorites for example England and Argentina generated a value price for professionals to bet in many instances throughout these friendlies.

Why then did global syndicates not do what they do best and bet these perceived value selections in the international friendlies?

The answer is liquidity and the admirable discipline shown by the larger professional syndicates to wait for the improved liquidity conditions, which will become available during the World Cup from both bookmakers and the major betting exchanges. The professional syndicates knew that if they bet in the lead up international friendlies, not only would they not get set for the amounts they wanted to invest, but more importantly they would reveal their ratings for each team participating in the World Cup.

Other market participants recognize when a large syndicate places a bet and take note of its direction. By entering the market during the past weeks international friendly matches, syndicates would have in effect “shown their hand” to the market. The major downside of taking this action is the fact that if their ratings are revealed to the market, other market participants would have acted upon the information and bet similar selections during the World Cup, this would have increased the amount of smart money on certain selections throughout the world cup and forced the price lower on the selections syndicates plan to back when the increased world cup liquidity becomes available.

The professional syndicates are now well positioned to launch into an array of massive bets with bookmakers and major betting exchanges, at a desired price which has not been eroded by a revealed rating and in large bet size only achievable with World Cup market liquidity.