5 ms·

so how do you decide where the odds should start? I think they still need a bookmaker for this, I think. What happens when the first person bets? I have never r

by 55555 2y ago

so how do you decide where the odds should start? I think they still need a bookmaker for this, I think. What happens when the first person bets? I have never read up on how poly market works but I believe they must act as an Automated Market Maker as they provide instant liquidity.

grogenaut 2y ago
you don't really care... you just adjust the odds you are offering to balance the books with each bet and until you get good or get a nut you put limits on the bet sizes so it's easier to bin pack the bets. This was super common with sports bookies pre just holding the vegas line. Get a huge bet on paul that you don't have offset? offer better odds on tyson till it balances. as a bookie your goal at the end of the day is to have the most total amount of bets on the book (say 1M in total wagers) where the money placed at the odds completely evens out so that at the end of the day you take 10% of 1 million for providing the market (the vig) and pay one set of betters with the other's money. In fact as the house you're just building creating your own arbitrage by inventing currency exchange rates.
foobar1962 2y ago
Back in the 1980s I did some work on a computerised tabulation system for a large race course: my part was programming EPROMS for the displays, but I learned a lot about the system from that time. Basically, the house takes their cut from all the bets. The house cannot lose. Then they share whatever's left amongst the winners. The returns for a $1 bet on a horse are calculated in real time and displayed on the screens. THESE ARE NOT THE FINAL ODDS, they change as bets are placed right up until the race starts, which is the starting price (and where the term SP bookmakers comes from). Contrast this with bookmakers at the track who offer fixed odds when the bets are placed. They stand a chance of losing if they get their numbers wrong.

by 55555 2y ago

grogenaut 2y ago

you don't really care... you just adjust the odds you are offering to balance the books with each bet and until you get good or get a nut you put limits on the bet sizes so it's easier to bin pack the bets. This was super common with sports bookies pre just holding the vegas line. Get a huge bet on paul that you don't have offset? offer better odds on tyson till it balances. as a bookie your goal at the end of the day is to have the most total amount of bets on the book (say 1M in total wagers) where the money placed at the odds completely evens out so that at the end of the day you take 10% of 1 million for providing the market (the vig) and pay one set of betters with the other's money. In fact as the house you're just building creating your own arbitrage by inventing currency exchange rates.

foobar1962 2y ago

Back in the 1980s I did some work on a computerised tabulation system for a large race course: my part was programming EPROMS for the displays, but I learned a lot about the system from that time. Basically, the house takes their cut from all the bets. The house cannot lose. Then they share whatever's left amongst the winners. The returns for a $1 bet on a horse are calculated in real time and displayed on the screens. THESE ARE NOT THE FINAL ODDS, they change as bets are placed right up until the race starts, which is the starting price (and where the term SP bookmakers comes from). Contrast this with bookmakers at the track who offer fixed odds when the bets are placed. They stand a chance of losing if they get their numbers wrong.