Pricing Decisions and Insider Trading in Fixed-Odds Horse Betting Markets
Bibliographic Data
| ID | 23629987 |
|---|---|
| Authors | Adi Schnytzer (Bar-Ilan University), Vasiliki Makropoulou (Athens University of Economics and Business), Martien Lamers (0000-0003-0034-7445, Ghent University) |
| Editors | Leighton Vaughan-Williams, Donald S Siegel (0000-0002-7668-9751) |
| Year | 2013 |
| Pages | 315-338 |
| Publication date | 2013-11-12 |
| Open Access | No |
| Type | CHAPTER |
| Venue | The Oxford Handbook of the Economics of Gambling (SOURCE_BOOK) |
| Publisher | Oxford University Press (PUBLISHER • GB) |
| DOI | 10.1093/oxfordhb/9780199797912.013.0018 |
| OpenAlex | W1666675897 |
| ISBN | 9780199797912 |
| Language | EN |
| Citations received | 1 |
This chapter conceptualizes fixed-odds horse betting markets as implicit call option markets. The decision-making process of a bookmaker is a model that sets prices under uncertainty, showing that when a bookmaker follows this pricing process built on implicit options the returns will exhibit a favorite-longshot bias. By performing Monte Carlo simulations, option values are generated and a measurement made of the degree of insider trading.
Actuarial science · Econometrics · Economics · Financial economics · Insider · Insider trading · Logistic regression · Odds · Statistics · Finance · Mathematics · Sports Analytics and Performance
| Citations per year | 0.07 |
|---|---|
| Citation span | 2011 - 2011 (1) |
| Highly cited | No |