Condition Market Book Percentage

Updated on 2024-07-25

The condition allows setting limits on the book percentage parameters.

Specifically, there are two types of percentages, called Back Book Percentage and Lay Book Percentage, which refer to the sum of the implied probabilities of the best available odds for backing and laying on the various selections in the market, respectively.

For example, suppose the best back odds in a given market with three selections (such as the classic Match Odds market of a football match) are as follows:

Selection A WINS: best back odds 2.54

Selection B WINS: best back odds 2.98

DRAW: best back odds 3.25

Each of these corresponds to an implied probability equal to the inverse of the odds. Summing the probabilities gives:

1/2.54 + 1/2.98 + 1/3.25 = 1.037 = 103.7%

In ideal conditions, since the event that any of the selections wins should total 100%, it would be possible to back all outcomes with certainty of recovering the invested capital. If the sum were less than 100%, it would mean that properly backing all selections would guarantee a profit. Clearly, market odds include a certain spread for the bookmaker's remuneration, so the sum of these percentages will generally be greater than 100%.

The same reasoning can be applied to the Lay Book Percentage, which, following a similar logic, is normally less than 100%.

The utility of these percentages is that they allow us to determine when a market is mature in terms of represented odds, i.e., how accurately it reflects the probabilities of events.

By setting, for example, the back book percentage between 100% and 115% and the lay book percentage between 85% and 100%, we automatically exclude all situations where, for example, a back or lay odds is missing due to illiquidity or an already determined outcome.

Further refined conditions on the state of the market can be imposed with the Formula condition, which includes variables referring to the values described above.

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