Place Betting System
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*Place Betting System
*Place Betting System Australia
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Even if you have never placed a football bet in a betting shop before, you should not fret about this as there is. Football Martingale Betting System. ’THE BEST WAY TO MAKE MONEY FROM BETTING!!!’ The only way to make consistent profit and beat the bookies is Betting On 2nd Half Goals. Discover The Best Sports Betting System That Provides Picks on MLB, NHL, NBA, NFL & others. Go Through Our Sports Betting System Review To Find The Right One.ГлавнаяБаза знаний ’Allbest’Спорт и туризмDevelopment of the system of sports bettingHistory of sports betting. The ’cash out’ option in sports betting. The main determinants of the betting process. To test the hypothesis that the risk-aversion as the factor that makes individuals accept the amount to ’cash out’ proposed by a bookmaker.РубрикаСпорт и туризмВиддипломная работаЯзыканглийскийДата добавления04.11.2015Размер файла651,3 KОтправить свою хорошую работу в базу знаний просто. Используйте форму, расположенную ниже
Студенты, аспиранты, молодые ученые, использующие базу знаний в своей учебе и работе, будут вам очень благодарны.Размещено на http://www.allbest.ru/Table of Contents
*Chapter 1. Introduction
*1.1 Problem statement
*1.2 Rationale for the study
*1.3 Research aims and objectives
*Chapter 2. Literature review
*2.1 Introduciton
*2.2 History of sports betting
*2.3 How does the betting process look like
*2.4 The “Cash out” option in sports betting
*2.5 The main determinants of the betting process
*2.6 Conclusion
*Chapter 3. The theoretical model
*3.1 The main assumptions of the model
*3.2 Extreme case analysis3.3 Generalizing the model
*Chapter 4. Conclusion
*List of references
*AppendicesChapter 1. IntroductionThe history of betting has been evolving for centuries and in retrospect, the earliest and most recognizable forms of betting could be traced back to Greece, home of Olympic Games, and Ancient Rome. Early Romans perceived the betting outcome as a decision of a Goddess Fortuna, one of the most popular cults of those years. They considered the concept of sports betting as part of their religious inclinations and spiritual obligations. Pliny the Elder, one of the authorities of the 1st century, said: “We are so much at the mercy of chance that Chance is our god”.The increased popularity of gambling was witnessed in the period preceding the Middle Ages, many nations tried to outlaw it, but then, the phenomenon of betting was reinvented in the Renaissance period. Since that time gambling was developing and becoming more popular. Thus, starting with wagering on “how much time one needs to pass a given distance” people ended up focusing on professional sports betting (such as football, golf, tennis, etc.).That leaded to the creation of several bodies which were meant to organize betting process among various sporting activities. The advances that have been made in the information and communication technology have largely shaped the techniques of undertaking wagering: several innovations that have been developed improved the effectiveness and the fun involved in the sport betting and made the process easier for the bettors. For example, nowadays it is very popular to use online services (betting sites, sportsbooks). One of the latest trends in sports betting is the “Cash out” option, the tool that gives to bettors the ability to take a return before the end of the event, thus, allowing to secure their profits or minimize their losses.1.1 Problem statementsports betting bookmakerDespite the advances that have been made in the sports betting industry, little emphasis has been placed on the analysis of the use and effectiveness of the “Cash out’ option. Bettors continue to utilize it without necessarily considering the advantages, disadvantages and viability of that option in the betting process. The question that arises is what makes the bettors use the “Cash out”? While the apparent benefits of this option is that this could spell a boon for a player who has had a bad day in the event, it curbs natural gambling instinct to go for the big `kill’ and earn large, handsome bounties for their gambling efforts. According to what rationality implies, if one accepts the bet he will not cash out until the final whistle of the referee unless any certain factors affect this decision. Moreover, the return from the bet taken before the end of the event would be quite less than the face value of the bet. Thus, using “Cash Out” robs the player of watching the nail biting, thrilling finish of the event and leaves him with mediocre sum which could have indeed been very large and substantial had he waited for the game to finally end(McGowan & Mahon, 2013). The above analysis implies that there are mixed benefits and disadvantages associated with the use of the “Cash out” option in betting, and there is dire need to undertake a research in order to understand why do the bettors utilize that option, what does affect their decision and what amount of cash has to be proposed to them in order to make them accept the offer. Intuitively, such behavior can be explained by the bettors’ and bookmakers’ preferences over risk. More precisely, the risk aversion of a bettor can lead to the acceptance of the “cash out” offer proposed by a risk-neutral bookmaker at some point in time during the game. What is analyzed in this paper is whether the risk-aversion of a bettor is the factor that makes him accept an amount of money proposed by a risk-neutral bookmaker before the end and not wait until the end of the event.1.2 Rationale for the studyIt is of vital importance to rationalize such proposition before undertaking the study and conducting a theoretical model. If the hypothesis suggested would have an irrelevant logical foundation the model would be preposterous and would not give any pertinent results.There will be made several assumptions in the corresponding chapter which the theoretical model will be based on. The main idea of making the suggestion that risk-aversion matters is the following. Starting with different beliefs about the outcome of the event, a bettor and a bookmaker change their opinions in the same way. The closer the end of the event, the closer to each other are the beliefs of these two players. Saying that a bettor is risk-averse while a bookmaker is risk-neutral implies that the expected utilities based on their subjective beliefs become closer even more. This allows to make a proposition that there is a point in time when the subjective beliefs of a bookmaker and a bettor are so close to each other that a bookmaker can offer a certain amount to cash out which will be beneficial for a bettor according to his utility expectations of an event outcome.1.3 Research aims and objectivesThe following research objectives were developed in order to guide in the undertaking of the study:How do betting companies undertake the betting processes and what differences are depicted in the diversified betting processes and options?What are the constructs of the “cash out” option in the betting process?Whether risk-aversion of a bettor is the factor that makes “cash out” option useful?Chapter 2. Literature review2.1 IntroductionSports betting is the placement of finances normally referred to as stakes on events with uncertainty about the occurrence with the hope of a particular outcome that will make a bettor earn additional money. What is important to note about betting is that the in the eventuality that the outcome of an event does not work out as anticipated, the bet is lost hence the money (or the stake) is lost (Takahashi, 2012). Betting therefore is a game of win or loss determined by the outcome of the event in focus.Elements of a bet that are worth noting are chance, consideration and a price. The placing of bets is done with the hope that chance favors the selected choice for one to win a price in this case the stakes involved (McMillen, 1993). However for one to be considered for a bet one must be able to place a bet and hope that it works as he expects. The outcome of the event is usually one that is determined after a short while since the events in which bets are placed are usually those that take a short while before the outcome is known and the lucky ones are rewarded.Bets are made on numerous events especially in the sports arena. In sports people bet on football, boxing, horse racing, other animals racing, athletics, rugby and even indoor events. The bets are hinged on luck to some extend because even the clear favorites do lose in unexpected events (Gutierrez, 2012c). In betting the stakes are usually high on those considered as underdogs since most people would avoid placing bets on such people. The assumption is usually that the underdogs are bound to fail therefore there is no need to take a risk on them. This however tends to work otherwise in some cases as the bets on underdogs pay off very handsomely.2.2 History of sports bettingBetting has been around for the long time dating back to the days when the roman emperor ruled the world. Back then they would bet on horse races in which races puling chariots would race while they watched, amused themselves and betted as well for fun. It is this racing for fun that led to the organization of a Grand National that involved horse racing at a national stage. Such a stage provided a perfect forum for people who then betted heavily on their horses in hope that they would win (Gutierrez, 2012a). Eventually with time this trend developed and was learnt by many through observation of what others were doing and how they used to place their bets.This marked the beginning of the revolution of betting which opened the evolution of betting. In 1934 William Hill started trading in bets allowing people to place stakes on the different sports events taking place over the country. William Hill sport betting still exists today serving as a reminder of how far sport betting has come over the years. In 1961, three decades later after William Hill had started sports bookmaking, betting was officially recognized and legalized with the requisite legislation put in place to guide its implementation. More people and shops then ventured into this line of business opening shops and encouraging people to visit and make bets. However, this was not the peak of betting yet as we know it today. Revolution towards the betting today’s started in 1993 when the bookmaking was taken online after internet was introduced. People were now able to make bets online without having to go to shops and they could have their money online making it easier and more convenient to bet (Seitz, 2011). Even with this there still exist bet shops to contain the crop of people who still prefer that as an option. Sports betting has evolved and gone through a lot to get where it is today although this may not be the last of it. In 2004 betting officially became a financial affair, the reason was an insertion of William Hill into the FTSE 100 that marked the realization that sport betting was not the chance people would use to earn good money.So question is does all this development mark the maturity of sport betting? Does it still have a future? The answer is there is still more to come from sport betting with the likelihood of service diversification being the likely occurrence in the near future. This will means there is going to be the introduction of specialized bets entailing peer to peer betting, personalization of the betting and betting being a forum for socialization and interaction (Owen, 2012). Sport betting was an event born out of the need for a gathering to derive more fun from a sporting event and this is why it is unlikely to die anytime soon. It will instead be a pillar upon which friendships will be cemented and interaction also initiated and developed.2.3 How does the betting process look likeFirst of all, some main definitions of the essential components of the betting process have to be mentioned.What every bettor considers before placing a bet is a numerical expression of the likelihood that a certain outcome of the event will take place. The tool that shows that is called odds. There are several ways of expressing the odds to customers, some platforms even offer bettors the option to choose the expression that is the most convenient for them. In this paper decimal (European, digital) odds will be used for simplicity. Such expression is the clearest one.The other thing that is worth noting is that there are many different forms of bets, and one of the most famous forms is straight betting. It entails choosing a team one feels will win in advance. In such a case the team one determines is the one he places the bet on before the game starts. At the end of the game a bettor either collect a prize that corresponds to the initial odds or looses the cash he bet (the stake).The betting process can be constructed in several ways. Depending on type of betting proposed betting platforms can denote either bookmaking (sportsbooks) companies or betting exchanges.Bookmaking companies (which offer the same what traditional bookies do) offer odds on the occurrence of some outcome of the event, the customers bet according that odds. Such betting process implies wagers placing the bet on the particular outcome and a bookmaker betting against that outcome (or on all the other possible outcomes). Bookmaker decides what odds to offer according to his subjective beliefs and to the amount of stakes received for each outcome.Betting exchange companies represent a marketplace where wagers bet against each other, not against the company. The revenue of Betting exchanges consists of transaction fees, so the profit of such company does not depend on the outcome of the event. Customers of betting exchanges have more options than those of bookmaking companies: bettors here can bet both on some team’s win and against it. Putting it simply, bettors can take the role of the bookmaker. They suggest the odds that they find convenient and then are matched with the other bettor who accepts the offer and bets with the same odds on the opposite outcome.2.4 The “Cash out” option in sports betting“Cash out” in sports betting is an option proposed to customers which allows bettors to take the money before the end of the event. Intuitively, when at some point in time during the game there is a score that a bettor bet on, and he is afraid that the final outcome may change, he can use “cash out” to take the amount of money that is proposed by a bookmaker at that particular point of time. This will give a customer some profit which will be less than the initial price, but at least he will be confident that he will earn something.The other case when this option may seem useful is when during the game a bettor feels that the score he bet on is not likely to occur in the end of the event, he can “cash out” for another reason: he will not have the profit in this case, actually, he will loose money, but the loss will be smaller then the initial stake.So, this option helps to secure profits of the wagers and minimize losses.However there is a catch to this type of betting in that the odds that were initially used to bet are usually higher than what is used to pay an individual who opts to cash out of the bet.Being a safe kind of bet it is often tricky and demanding hence requiring a lot of discipline and carefully planning and consideration. This is because the odds often change in response to the changes in the remaining uncertainty.One tricky element is that the bookmakers also appreciate the kind of loophole they create for betters by creating such an option. As such this kind of option that is cashing out is limited to a certain number of games only. This means that when placing bets where one expects such options it is important to be careful not to make the wrong decisions and incur huge losses. Cashing out looks like an easy way to make money and truly it is although only successful when there is careful planning and strategizing on the part of the better. Emphasis on discipline is also another important dimension since such options are limited to certain games by the bookmakers because they see such games as impossible or with slimmest chance to achieve such a goal. As such set targets should be stuck to so as to avoid the open traps that have been laid for them (Gutierrez, 2012b).Cash out options are also applicable to single bets considering the complexity were they to be used on multiply games. This means that is only possible to use cash out option on one single game rather than on a bet consisting of a series of bets in a single game. This cash out option could be convenient for tournament bets such as the world cup. In a scenario where an individual bets on a particular country say German to win the world cup. However despite the mixed performances of draws, losses and wins they manage to pull off and reach the final. However their opponents in the final looks like the team likely to beat them. What an individual does is to exercise the cash out option and not only get back the initial cash used on the bet but also with a little profit (Altman, 1985).The use of cash out option is particularly good for the accumulator kind of bets. This entails placing a series of bets on the same team as highlighted above. The option of cash out comes in when the next opponent to the team the bet is on is likely to lose. That is when one exercises the option to cash out. It is therefore an option to mitigate from a complete loss by allowing the individual who put in the bet to salvage a little from what has been accumulated from the initial bet. Use of cash out option however is tricky and should often be thoroughly examined before being adopted (Birch, 1996).2.5 The main determinants of the betting processWhat is of the main importance while analyzing a betting process mathematically is what the betting consists of. There are two “players” who will be analyzed: a bookmaker and a bettor.Despite the fact that they have the same goal - to “win”, they also have a lot of differences in their behavior and preferences.-Utility functionThe crucial factor that determines the behavior of an agent is his utility function. Bernoulli (1738) was the first who proposed an interpretation for utility of wealth in his theory of decision-making among risky prospects with monetary outcomes. The second, more recent, interpretation was proposed by von Neumann and Morgenstern (1944), and that is one which is used in this paper. The utility of wealth is treated as a measure of an agent’s intensity of preference for some wealth with reference to outcome probabilities. (Fishburn, Bell, 2000)-Agents’ preferencesWhen the choice under uncertainty takes place, it is common to say that people may have different attitudes toward risk, they can be: risk-averse, risk-neutral and risk-loving. Economists typically assume that an indiv
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*Place Betting System
*Place Betting System Australia
*Place Betting System Free
Even if you have never placed a football bet in a betting shop before, you should not fret about this as there is. Football Martingale Betting System. ’THE BEST WAY TO MAKE MONEY FROM BETTING!!!’ The only way to make consistent profit and beat the bookies is Betting On 2nd Half Goals. Discover The Best Sports Betting System That Provides Picks on MLB, NHL, NBA, NFL & others. Go Through Our Sports Betting System Review To Find The Right One.ГлавнаяБаза знаний ’Allbest’Спорт и туризмDevelopment of the system of sports bettingHistory of sports betting. The ’cash out’ option in sports betting. The main determinants of the betting process. To test the hypothesis that the risk-aversion as the factor that makes individuals accept the amount to ’cash out’ proposed by a bookmaker.РубрикаСпорт и туризмВиддипломная работаЯзыканглийскийДата добавления04.11.2015Размер файла651,3 KОтправить свою хорошую работу в базу знаний просто. Используйте форму, расположенную ниже
Студенты, аспиранты, молодые ученые, использующие базу знаний в своей учебе и работе, будут вам очень благодарны.Размещено на http://www.allbest.ru/Table of Contents
*Chapter 1. Introduction
*1.1 Problem statement
*1.2 Rationale for the study
*1.3 Research aims and objectives
*Chapter 2. Literature review
*2.1 Introduciton
*2.2 History of sports betting
*2.3 How does the betting process look like
*2.4 The “Cash out” option in sports betting
*2.5 The main determinants of the betting process
*2.6 Conclusion
*Chapter 3. The theoretical model
*3.1 The main assumptions of the model
*3.2 Extreme case analysis3.3 Generalizing the model
*Chapter 4. Conclusion
*List of references
*AppendicesChapter 1. IntroductionThe history of betting has been evolving for centuries and in retrospect, the earliest and most recognizable forms of betting could be traced back to Greece, home of Olympic Games, and Ancient Rome. Early Romans perceived the betting outcome as a decision of a Goddess Fortuna, one of the most popular cults of those years. They considered the concept of sports betting as part of their religious inclinations and spiritual obligations. Pliny the Elder, one of the authorities of the 1st century, said: “We are so much at the mercy of chance that Chance is our god”.The increased popularity of gambling was witnessed in the period preceding the Middle Ages, many nations tried to outlaw it, but then, the phenomenon of betting was reinvented in the Renaissance period. Since that time gambling was developing and becoming more popular. Thus, starting with wagering on “how much time one needs to pass a given distance” people ended up focusing on professional sports betting (such as football, golf, tennis, etc.).That leaded to the creation of several bodies which were meant to organize betting process among various sporting activities. The advances that have been made in the information and communication technology have largely shaped the techniques of undertaking wagering: several innovations that have been developed improved the effectiveness and the fun involved in the sport betting and made the process easier for the bettors. For example, nowadays it is very popular to use online services (betting sites, sportsbooks). One of the latest trends in sports betting is the “Cash out” option, the tool that gives to bettors the ability to take a return before the end of the event, thus, allowing to secure their profits or minimize their losses.1.1 Problem statementsports betting bookmakerDespite the advances that have been made in the sports betting industry, little emphasis has been placed on the analysis of the use and effectiveness of the “Cash out’ option. Bettors continue to utilize it without necessarily considering the advantages, disadvantages and viability of that option in the betting process. The question that arises is what makes the bettors use the “Cash out”? While the apparent benefits of this option is that this could spell a boon for a player who has had a bad day in the event, it curbs natural gambling instinct to go for the big `kill’ and earn large, handsome bounties for their gambling efforts. According to what rationality implies, if one accepts the bet he will not cash out until the final whistle of the referee unless any certain factors affect this decision. Moreover, the return from the bet taken before the end of the event would be quite less than the face value of the bet. Thus, using “Cash Out” robs the player of watching the nail biting, thrilling finish of the event and leaves him with mediocre sum which could have indeed been very large and substantial had he waited for the game to finally end(McGowan & Mahon, 2013). The above analysis implies that there are mixed benefits and disadvantages associated with the use of the “Cash out” option in betting, and there is dire need to undertake a research in order to understand why do the bettors utilize that option, what does affect their decision and what amount of cash has to be proposed to them in order to make them accept the offer. Intuitively, such behavior can be explained by the bettors’ and bookmakers’ preferences over risk. More precisely, the risk aversion of a bettor can lead to the acceptance of the “cash out” offer proposed by a risk-neutral bookmaker at some point in time during the game. What is analyzed in this paper is whether the risk-aversion of a bettor is the factor that makes him accept an amount of money proposed by a risk-neutral bookmaker before the end and not wait until the end of the event.1.2 Rationale for the studyIt is of vital importance to rationalize such proposition before undertaking the study and conducting a theoretical model. If the hypothesis suggested would have an irrelevant logical foundation the model would be preposterous and would not give any pertinent results.There will be made several assumptions in the corresponding chapter which the theoretical model will be based on. The main idea of making the suggestion that risk-aversion matters is the following. Starting with different beliefs about the outcome of the event, a bettor and a bookmaker change their opinions in the same way. The closer the end of the event, the closer to each other are the beliefs of these two players. Saying that a bettor is risk-averse while a bookmaker is risk-neutral implies that the expected utilities based on their subjective beliefs become closer even more. This allows to make a proposition that there is a point in time when the subjective beliefs of a bookmaker and a bettor are so close to each other that a bookmaker can offer a certain amount to cash out which will be beneficial for a bettor according to his utility expectations of an event outcome.1.3 Research aims and objectivesThe following research objectives were developed in order to guide in the undertaking of the study:How do betting companies undertake the betting processes and what differences are depicted in the diversified betting processes and options?What are the constructs of the “cash out” option in the betting process?Whether risk-aversion of a bettor is the factor that makes “cash out” option useful?Chapter 2. Literature review2.1 IntroductionSports betting is the placement of finances normally referred to as stakes on events with uncertainty about the occurrence with the hope of a particular outcome that will make a bettor earn additional money. What is important to note about betting is that the in the eventuality that the outcome of an event does not work out as anticipated, the bet is lost hence the money (or the stake) is lost (Takahashi, 2012). Betting therefore is a game of win or loss determined by the outcome of the event in focus.Elements of a bet that are worth noting are chance, consideration and a price. The placing of bets is done with the hope that chance favors the selected choice for one to win a price in this case the stakes involved (McMillen, 1993). However for one to be considered for a bet one must be able to place a bet and hope that it works as he expects. The outcome of the event is usually one that is determined after a short while since the events in which bets are placed are usually those that take a short while before the outcome is known and the lucky ones are rewarded.Bets are made on numerous events especially in the sports arena. In sports people bet on football, boxing, horse racing, other animals racing, athletics, rugby and even indoor events. The bets are hinged on luck to some extend because even the clear favorites do lose in unexpected events (Gutierrez, 2012c). In betting the stakes are usually high on those considered as underdogs since most people would avoid placing bets on such people. The assumption is usually that the underdogs are bound to fail therefore there is no need to take a risk on them. This however tends to work otherwise in some cases as the bets on underdogs pay off very handsomely.2.2 History of sports bettingBetting has been around for the long time dating back to the days when the roman emperor ruled the world. Back then they would bet on horse races in which races puling chariots would race while they watched, amused themselves and betted as well for fun. It is this racing for fun that led to the organization of a Grand National that involved horse racing at a national stage. Such a stage provided a perfect forum for people who then betted heavily on their horses in hope that they would win (Gutierrez, 2012a). Eventually with time this trend developed and was learnt by many through observation of what others were doing and how they used to place their bets.This marked the beginning of the revolution of betting which opened the evolution of betting. In 1934 William Hill started trading in bets allowing people to place stakes on the different sports events taking place over the country. William Hill sport betting still exists today serving as a reminder of how far sport betting has come over the years. In 1961, three decades later after William Hill had started sports bookmaking, betting was officially recognized and legalized with the requisite legislation put in place to guide its implementation. More people and shops then ventured into this line of business opening shops and encouraging people to visit and make bets. However, this was not the peak of betting yet as we know it today. Revolution towards the betting today’s started in 1993 when the bookmaking was taken online after internet was introduced. People were now able to make bets online without having to go to shops and they could have their money online making it easier and more convenient to bet (Seitz, 2011). Even with this there still exist bet shops to contain the crop of people who still prefer that as an option. Sports betting has evolved and gone through a lot to get where it is today although this may not be the last of it. In 2004 betting officially became a financial affair, the reason was an insertion of William Hill into the FTSE 100 that marked the realization that sport betting was not the chance people would use to earn good money.So question is does all this development mark the maturity of sport betting? Does it still have a future? The answer is there is still more to come from sport betting with the likelihood of service diversification being the likely occurrence in the near future. This will means there is going to be the introduction of specialized bets entailing peer to peer betting, personalization of the betting and betting being a forum for socialization and interaction (Owen, 2012). Sport betting was an event born out of the need for a gathering to derive more fun from a sporting event and this is why it is unlikely to die anytime soon. It will instead be a pillar upon which friendships will be cemented and interaction also initiated and developed.2.3 How does the betting process look likeFirst of all, some main definitions of the essential components of the betting process have to be mentioned.What every bettor considers before placing a bet is a numerical expression of the likelihood that a certain outcome of the event will take place. The tool that shows that is called odds. There are several ways of expressing the odds to customers, some platforms even offer bettors the option to choose the expression that is the most convenient for them. In this paper decimal (European, digital) odds will be used for simplicity. Such expression is the clearest one.The other thing that is worth noting is that there are many different forms of bets, and one of the most famous forms is straight betting. It entails choosing a team one feels will win in advance. In such a case the team one determines is the one he places the bet on before the game starts. At the end of the game a bettor either collect a prize that corresponds to the initial odds or looses the cash he bet (the stake).The betting process can be constructed in several ways. Depending on type of betting proposed betting platforms can denote either bookmaking (sportsbooks) companies or betting exchanges.Bookmaking companies (which offer the same what traditional bookies do) offer odds on the occurrence of some outcome of the event, the customers bet according that odds. Such betting process implies wagers placing the bet on the particular outcome and a bookmaker betting against that outcome (or on all the other possible outcomes). Bookmaker decides what odds to offer according to his subjective beliefs and to the amount of stakes received for each outcome.Betting exchange companies represent a marketplace where wagers bet against each other, not against the company. The revenue of Betting exchanges consists of transaction fees, so the profit of such company does not depend on the outcome of the event. Customers of betting exchanges have more options than those of bookmaking companies: bettors here can bet both on some team’s win and against it. Putting it simply, bettors can take the role of the bookmaker. They suggest the odds that they find convenient and then are matched with the other bettor who accepts the offer and bets with the same odds on the opposite outcome.2.4 The “Cash out” option in sports betting“Cash out” in sports betting is an option proposed to customers which allows bettors to take the money before the end of the event. Intuitively, when at some point in time during the game there is a score that a bettor bet on, and he is afraid that the final outcome may change, he can use “cash out” to take the amount of money that is proposed by a bookmaker at that particular point of time. This will give a customer some profit which will be less than the initial price, but at least he will be confident that he will earn something.The other case when this option may seem useful is when during the game a bettor feels that the score he bet on is not likely to occur in the end of the event, he can “cash out” for another reason: he will not have the profit in this case, actually, he will loose money, but the loss will be smaller then the initial stake.So, this option helps to secure profits of the wagers and minimize losses.However there is a catch to this type of betting in that the odds that were initially used to bet are usually higher than what is used to pay an individual who opts to cash out of the bet.Being a safe kind of bet it is often tricky and demanding hence requiring a lot of discipline and carefully planning and consideration. This is because the odds often change in response to the changes in the remaining uncertainty.One tricky element is that the bookmakers also appreciate the kind of loophole they create for betters by creating such an option. As such this kind of option that is cashing out is limited to a certain number of games only. This means that when placing bets where one expects such options it is important to be careful not to make the wrong decisions and incur huge losses. Cashing out looks like an easy way to make money and truly it is although only successful when there is careful planning and strategizing on the part of the better. Emphasis on discipline is also another important dimension since such options are limited to certain games by the bookmakers because they see such games as impossible or with slimmest chance to achieve such a goal. As such set targets should be stuck to so as to avoid the open traps that have been laid for them (Gutierrez, 2012b).Cash out options are also applicable to single bets considering the complexity were they to be used on multiply games. This means that is only possible to use cash out option on one single game rather than on a bet consisting of a series of bets in a single game. This cash out option could be convenient for tournament bets such as the world cup. In a scenario where an individual bets on a particular country say German to win the world cup. However despite the mixed performances of draws, losses and wins they manage to pull off and reach the final. However their opponents in the final looks like the team likely to beat them. What an individual does is to exercise the cash out option and not only get back the initial cash used on the bet but also with a little profit (Altman, 1985).The use of cash out option is particularly good for the accumulator kind of bets. This entails placing a series of bets on the same team as highlighted above. The option of cash out comes in when the next opponent to the team the bet is on is likely to lose. That is when one exercises the option to cash out. It is therefore an option to mitigate from a complete loss by allowing the individual who put in the bet to salvage a little from what has been accumulated from the initial bet. Use of cash out option however is tricky and should often be thoroughly examined before being adopted (Birch, 1996).2.5 The main determinants of the betting processWhat is of the main importance while analyzing a betting process mathematically is what the betting consists of. There are two “players” who will be analyzed: a bookmaker and a bettor.Despite the fact that they have the same goal - to “win”, they also have a lot of differences in their behavior and preferences.-Utility functionThe crucial factor that determines the behavior of an agent is his utility function. Bernoulli (1738) was the first who proposed an interpretation for utility of wealth in his theory of decision-making among risky prospects with monetary outcomes. The second, more recent, interpretation was proposed by von Neumann and Morgenstern (1944), and that is one which is used in this paper. The utility of wealth is treated as a measure of an agent’s intensity of preference for some wealth with reference to outcome probabilities. (Fishburn, Bell, 2000)-Agents’ preferencesWhen the choice under uncertainty takes place, it is common to say that people may have different attitudes toward risk, they can be: risk-averse, risk-neutral and risk-loving. Economists typically assume that an indiv
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