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birb_cromble  3d ago (text post)   506 thread views

Weekly Finance Thread - 2027-07-04

A weekly thread to discuss financial matters - from personal all the way up to global.

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This world cup has been pretty brutal for bookmakers with lots of high-profile favorite wins + highest profile player scores goals kinda outcomes. Potentially you've found an edge but having had relationships with some of the biggest dick syndicates in the world who are scraping out 1-2% over time with immense swings I'd probably lean that you're lucky moreso than good.

Did you read the part where I said a decade?

No, he's FUDing. I think it's in good faith, but based on an idle belief in faulty neoclassical economic dogma. The Efficiency concept assumes the blank slate. It says the median market trader has all available information, but it does not say if they use that information correctly. Likewise, the way he uses the word edge assumes insider trading, a secret information source, but with uniformly obvious analysis of that information. So in other words trader quality doesn't vary, just sources of external information. Obviously this is wrong per HBD.

My intuition is that, for a long time in politics, I have beat the market not with secret information, but superior analysis skills. But in politics there is no competition like Hanson wants allowed, so you just get ignored with superior ideas. In theory, though, these superior analysis skills should transfer to trading, including sports odds, because not only is it better than the median sports fan, it's also better than the vast majority of Ivy league grads and Jane street traders (median IQ 120), who are picked not for skill but for the willingness to cheat and lie and grind. Most of their edge in other markets comes from cheating (buying secret data) and grinding (trading all the time and trading with more capital than they deserve, because it was handed to them). My analysis should be superior to them in a live sports game where they can't pull these dirty tricks. And it seems to be. I made 16% yesterday, main reason it wasn't more is the Mexico game had weird stuff happen, I believe their behavior at the end of the second half was low probability and I lost on that.

You're betting into large holds inplay, I'd be very surprised if you had any unique insights on stuff that actually impacts lategame pricing like rotations or quality of substitutes moreso than vibe-betting and the 'secret data' thing is literally just applied intelligence. Big syndicates will literally rewatch all games played and regrade them according to their own particular talent evaluation matrices, plus pay for the absolute fastest feeds (If you're watching on TV you are verymuch behind) and they barely eke out tiny margins over time.

The Median Sports Fan's IQ for these things is essentially 20 in terms of betting ability, there is a gigantic gap between 'smarter than the average punter' and 'capable of swinging profitably on gut feel on the most liquid sporting markets in the world without particular price sensitivty'. You'd be better off just punting random stocks since atleast that's a positive sum market.

Equity markets are positive sum. Sports markets are negative sum. The Kalshi markets are being pushed off fairs against 'public' teams a bit due to weight of retard money but if I check back again in 1000 bets you will have lost your ass most likely in whatever strategy you think you've found.

Most Jane Street traders aren’t cheating or doing anything interesting. They’re exploiting tiny quirks in foreign derivatives markets or the repo market / basis trade or creating ever more complex ways to eke out margin when ETFs rebalance all with huge leverage so that 1bp becomes a moderately large figure.

There are definitely still hedge fund types who engage in the traditional shadier kind of business, but they’re not quants, they’re big global/regional macro or sector/theme funds run by guys in their sixties whose claim to fame was correctly calling one big crash in the last 35 years.

Yeah most macro guys have one or two big bets that work out and otherwise get their asses beat over time. Market making is just a gigantic ticket clipping operation which is why it's relatively sustainable and scales well

It’s a ticket clipping operation but in certain cases with insane leverage which in a real crisis where crazy things happen for short periods in the repo market (like they did in 2008) could blow up in an interesting way.

True. It's not completely free money but it's less reliant on directional moves provided they aren't big outliers.

RIP Benn Eifert 🙏

Most Jane Street traders aren’t cheating or doing anything interesting. They’re exploiting tiny quirks in foreign derivatives markets or the repo market / basis trade or creating ever more complex ways to eke out margin when ETFs rebalance all with huge leverage so that 1bp becomes a moderately large figure.

That's cheating if a 140 IQ person can't do it from home. The world exists for smart individuals, not grinding ekers.

I mean 140 IQ guys are setting the parameters then it's a combination of top tier bots, accumulated subject matter expertise and negotiating super low fees in exchange for super high turnover.

How many bets is that? Thousands? The same edge has held through massive swings in how odds are calculated in that period?

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