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Overview of Financial Betting on Forex, Indices, Commodities and Shares from Mohammad Daniyal's blog

This is why it is critical to only place bets on those bets that have low spreads - eg "good prices". If the spread is low enough, then you can be profitable in the long run if you make good predictions. If the spread is quite high, then you basically have no chance, no matter how good your predictions.


The challenge is that betting services don't make it easy to figure out what their spreads are. So you need to understand how they price bets, and then you can understand the spread, and thus how good the price is. There is usually a very easy way to figure out the spread, and we'll get to that in a minute. But first it is probably helpful if you understand how betting services determine the "fair value" of the bet, which they then add the spread on top of to give you the final price.


Financial bets are a form of option (in fact, they are also called binary options, because the outcome is "binary - you either win or lose, nothing in between). And there is widely accepted way of determining the fair value of an option - its called the Black-Scholes model. This model is widely used in the financial markets and other industries to determine the fair value of an option.


Although the model is pretty complicated, it can be boiled down to: the price increases as time increases and as asset volatility increases (volatility is a measure of how much the asset prices move per unit time). So if one bet is for a one hour period, and if one is for a one day period, the one day bet price will be higher. And if one bet is on a calm market, and one is on a stormy market, the stormy market bet price will be higher.


There is a huge amount of information available about "predicting the markets" - just Google that term or "winning trading strategies" or "make money markets", etc. And much if not most of this information is total garbage.


If we knew of a "foolproof" way to make 토토 profits in the markets we'd be (insert retire young and rich fantasy of your choice here). But that is not the reality. The reality is that the markets are often very unpredictable, and at most times approximate a "coin flip" where you have a 50% chance of being right. So if you can be right 55% of the time, you are doing a good job. Correct 60% of the time and you are doing a really good job. Correct 70% of the time and you are world-class.


Your objective should be to get you into the 55-60% correct range. If you can do that, and only make low cost bets, you can earn a 3-8% return on investment (ROI).


So how to achieve that 55-60% win rate? Well remember that financial bets are done in pairs, such as a "rise/fall" pair or a "hit/miss" pair, etc. And the total probability of each of these occurring needs to add up to 100%, so if the probability of one side occurring is 60%, then the probability of the other side occurring must be 40%.


We suggest that you look for bets that are *favorably* mis-priced. This means that the probability implied in the bet price is *lower* from the probability implied by the your predicting method. If you choose the pair that has the favorable mis-pricing, you will win over time (and remember if one side of the pair is favorable, the other must be unfavorable by an equal amount and you should avoid that side of the bet).


Here is a simple example. Say you had a fair coin which had a 50% chance of heads and a 50% chance of tails. If someone offered you a bet which was priced where the heads was assumed at a 45% chance and the tails at 55%, you'd be foolish not to bet on heads. Why? Because they are pricing heads as if it will win 45% of the time, when you know it will win at 50%!


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