Measuring the Extent of Inside Trading in Horse Betting Markets
This paper develops a theoretical model that examines the optimal price setting by on-course bookmakers in the racetrack betting market. The model suggests that opening prices should include a premium that compensates bookmakers for the risk that insiders will account for private information and exploit any mis-pricing made by the bookmakers. The model is an extension of the model developed by Makropoulou and Markellos (2007) for football betting to the racetrack betting market. Using an extensive dataset and performing Monte Carlo simulations to calculate the potential value of new information, we measure insider trading in the Australian racetrack betting market.
Year of publication: |
2009-04
|
---|---|
Authors: | Schnytzer, Adi ; Lamers, Martien ; Makropoulou, Vasiliki |
Institutions: | Department of Economics, Bar Ilan University |
Saved in:
freely available
Saved in favorites
Similar items by person
-
The Impact of Insider Trading on Forecasting in a Bookmakers' Horse Betting Market
Schnytzer, Adi, (2009)
-
The Impact of Insider Trading on Forecasting in a Bookmakers' Horse Betting Market
Schnytzer, Adi, (2011)
-
Measuring the Extent of Inside Trading in Horse Betting Markets
Schnytzer, Adi, (2010)
- More ...