Mark Davies leaves BetFair -but the SEO cretins stay.

One month ago, I reported that BetFair silenced their PR chief (Mark Davies) by moving him to regulation affairs and asking him to shut up his voluble gob. Office politics played against him. Too bad.

Well, as Mark Davies can’-t live in the dark (away from the limelights), he has resigned, and started off his own company, Camberton —-so as to do what BetFair was recently forbidding him to do (PR). I wish him good luck, with 2 caveats.

#1. Mark Davies’-s true love is in fact journalism. But it doesn’-t pay, unless you do TV prominently. If Mark had bollocks, he would go into journalism.

#2. Mark Davies is a SEO virgin (“-Camberton”- is of course notably absent from Google), who was taking tips at BetFair from the world’-s crappiest SEOs. Mark Davies will have to learn web marketing. (I am not even sure Mark knows what “-SEO”- stands for.) And there’-s the WordPress factor. Mike Robb got it, but Mark never did.

Leaving BetFair is a good thing —-provided he can learn in the open what he couldn’-t learn while at BetFair: Marketing 2.0.

BetFairs Mark Davies (the Prince of betting exchange PR) has just gotten a second omelet in the face.

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First, the Financial Times —-and, now, Freakonomics.

The journalistic rule should be that, if you cite one prediction exchange, you should cite the one that is the most liquid on the market you are writing about. For UK politics, it is clearly BetFair.

BetFair has clearly a PR problem.

Does InTrade participate on its 2012 Republication Nomination prediction markets?

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A mysterious InTrade forum user (could be a trader or could be John Delaney) has posted this:

*****
Newbie

Joined: 24/01/2010 15:58:35

Messages: 1

Original thread at midasoracle.org:

So the actor has to a) not care about the transaction fee and b) have limitless margin. Intrade fits the bill for both of these. a) they don’t care about transaction fees because they are ultimately collecting them and b) if you only short when the bids are summed to over 100, it’s essentially an arb.

Until mid-April 2010, Intrade will refund market taking and expiry fees for arb trades –- details here.

Some products with a single guaranteed outcome are linked for cross-margining purposes. If you collect at least $10 by shorting all three contracts for the 2012 presidential election, then you will not have any funds frozen. The contract rules will tell you if a product is not linked (e.g. 2012 republican presidential nominees).

Intrade provides an API for developing trading applications. I am running a bot to take out market imbalances and as far as I’-m aware Intrade is not competing with me.

Ah.

Does InTrade participate on its own prediction markets?

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One (anonymous) InTrade trader:

I am utterly convinced Intrade participates in its own markets. Every few hours some kind of API hits the bids on the GOP 2012 nomination contract when the bids sum to more 100. It will even short bids at 0.1, which is a money losing proposition when you figure the transaction cost alone of 0.3 (since the price is below 5). Also, the amount of margin required to short all of these bids is in the millions of dollars.

So the actor has to a) not care about the transaction fee and b) have limitless margin. Intrade fits the bill for both of these. a) they don’-t care about transaction fees because they are ultimately collecting them and b) if you only short when the bids are summed to over 100, it’-s essentially an arb.

The trader also tells me that, on the InTrade forums where those questions were asked many times, InTrade never denied that they trade on their own prediction markets.

Previously: What was Max Keiser doing at InTrade HQ two years ago? –&gt- “due diligence”…!??…

Next: Does InTrade participate on its 2012 Republication Nomination prediction markets?

BetFair apologizes to Niall OConnor… and the other traders affected by the site outage.

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BetFair Forum:

Betfair would like to apologise for the unplanned site outage that occurred earlier this afternoon [Monday, January 25, 2010]. The cause of this problem is currently being investigated by our technical team. A list of affected markets will be posted shortly [here].

Once again please accept our apologies for any inconvenience this may have caused.

Will it be enough for Niall?

InTrade CEO John Delaney refused to improve the fairness of the trading on his Ireland-based event derivative exchange.

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InTrade —- US.GOVT.HEALTHPLAN.DEC09

truck-fail

One InTrade trader, in October 2009:

The four re-definitions that have (so far) been necessary during the 3-month life of the US.GOVT.HEALTHPLAN.DEC09 contracts have brought to my attention that Intrade, to the best of my knowledge, does nothing to notify members that contracts they own have been “-clarified”-. It may be coincidence that volume on this contract spiked upward on July 29, Septeber 5 &amp- 10, and October 9 following rule changes on July 28, September 4 &amp- 9 and October 9. I suspect, however, that some members were aware of the rule changes while others with open orders found out about them later. While avoiding such ambiguous contracts would be preferable, some system should be in place to ensure that the unexpected need to revise contract definitions does not provide certain members with an unintended advantage.

Among the possible changes that I feel would improve this situation are the following:
1) Post a notification in the “-News”- whenever existing contract definitions are changed.
2) Notify all members with current positions and/or orders in a given contract whenever rule changes are posted.
3) Halt trading for some period of time after each change to allow members equal opportunity to respond to these changes, rather than providing an advantage to anyone who might look back at the contract specs or read their email first, including anyone who might know to look for a change after requesting the clarification from Intrade.
4) Add an asterisk or other indicator beside the contract summary on the trading screen, so that members interested in that contract will know that the contract definition has been changed. Ideally, the date of this revision should be included.
5) Add whatever changes among the above are instituted to Rule 1.7.

Changes 1), 2) and 5) seem like common sense to me, but perhaps others will disagree. In any case, I look forward to other exchange members’- comments on all of these suggestions.

The same trader, in December 2009:

Well, six weeks have passed since Mr. Delaney’-s assurance that this issue would be addressed “-ASAP”-. Unless I have somehow missed being notified of the policy change , it seems clear that the status quo is fine by management.

All I can do to attempt to encourage Intrade to take seriously the ambiguities in certain contracts is:
1) liquidate all my positions in such contracts,
2) avoid trading any potentially ambiguous contracts,
3) attempt to warn other traders about contracts that may be potentially ambiguous.
In particular, I will certainly stay away from any contracts involving U.S. legislation.

I could instead try to anticipate specific improvements that would help minimize ambiguities. However, if Intrade management cannot be bothered to address this issue even in a broad way, I think that it would be counterproductive for me to apply the occasional Band-aid. Discouraging other traders from becoming entangled seems more productive.

Worlds #1 finance blogger withdraws all his money from InTrade… and blogs about it -detailing his negative customer experience to his thousands of Wall Street readers.

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Market Movers:

Dec 3 2008 5:52PM EST
The Problem With InTrade

I recently withdrew money from an InTrade account I’-ve had for some years. The total cost of withdrawing the money was $53.10: A $20 fee to InTrade for “-processing the bank wire”-, a €10 ($13.10) wire-transfer fee to National Irish Bank, and a $20 fee to Bank of America, the intermediary bank via which the money arrived in my Citibank account. If Citi had charged their customary $25 incoming wire fee, the total would have been $78.10.

You need to have a very large balance at InTrade, or an incredibly successful trading strategy, to make trading there worthwhile if it costs the best part of $80 just to withdraw your money. And prediction markets need a critical mass of users, otherwise they die. InTrade, for one, can count me out.

[Felix Salmon]

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Posted: Dec 03 2008 6:24pm ET
I’-ll definitely use the check option next time —- but there’-s no indication on their website as to which one is cheaper, and I stupidly thought that a wire transfer would be cheaper than printing and posting a check.
By Felix [Salmon]

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Posted: Dec 04 2008 04:46am ET
PayPal will not process transactions to online gambling sites (including Intrade) from the US. After the Unlawful Internet Gaming Enforcement Act none of the payment providers will process these transactions, that is why you are stuck with check and wire transfers.

I expect that Antiguan sports books offer free withdrawal because they have much higher margins than Intrade and therefore can absorb the costs elsewhere.
By nigeleccles [Nigel Eccles of HubDub]

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Previously: Why did John Delaney shut down TradeSports?

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Previously: The InTrade predicton markets on the viability of InTrade won’-t reveal *ANYTHING* about the future of InTrade.

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Previously: on TradeSports death – on InTrade’-s viability

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