Back on the Track with the Efficient Markets Hypothesis

Losey, Robert L.; Talbott, John

doi:10.1111/j.1540-6261.1980.tb03520.x

Cited by 17 publications

(3 citation statements)

References 7 publications

(6 reference statements)

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“…There was no evidence, however, that the information contained in forecasters' odds predictions could be used to earn positive net returns at the actual payout odds. Similar conclusions for the possibility of earning positive net returns have been obtained using US data by Figlewski (1979) and Losey and Talbott (1980).…”

Section: The Performance Of Racetrack Forecasting Servicessupporting

confidence: 81%

Can forecasters forecast successfully? Evidence from UK betting markets

Williams

2000

J. Forecast.

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This paper investigates the performance of professional racetrack forecasting services in the UK. The racetrack market is chosen for investigation because it oers a clear and well-de®ned set of costs and returns. As such, it provides a useful perspective from which to consider the eciency of professional forecasting performance. Five services are selected based on their reported success in a period prior to the sample selection. The results of this study indicate that all the services showed evidence of net pre-tax pro®ts, notably for more strongly recommended tips, but this would have required quite high stakes to cover the costs of accessing the information. Statistical tests of signi®cance were unable, however, to con®rm the evidence of pro®tability at conventional levels of acceptance. Taking into account the transactions costs of using these services, it is even more dicult to con®rm the existence of abnormal returns.

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Section: The Performance Of Racetrack Forecasting Servicessupporting

confidence: 81%

Can forecasters forecast successfully? Evidence from UK betting markets

Williams

2000

J. Forecast.

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“…Finally,itshouldbenotedthatthistestofthestrongform of the EMH is dependent on the fact that the experts examined do possess inside information. If this were not so, the test would constitute a test of semi-strong efficiency rather than strong form efficiency (Losey & Talbott, 1980:1040.…”

Section: Tests Of Strong Form Efficiencymentioning

confidence: 99%

The horse racing industry and the efficient markets hypothesis

Affleck-Graves

Money

Miedema

1987

SAJBM

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Betting on the racetrack and investing in the stockmarket have many characteristics in common. These similarities are discussed in this paper and the applicability of efficient markets theory to the market for horse racing bets in South Africa is examined. Both the weak form and the strong form of the efficient market hypothesis are empirically tested. The results indicate support for both forms although some small deviations from the theory do exist. Most notable of these is that on average long-odds horses win less frequently than suggested by their quoted odds whilst short-odds horses win more frequently than implied by their odds. However, these weak form deviations are not sufficient to enable consistent profits to be made. The performances of ten experts with potential access to inside information are examined and the results indicate that on average they are not able to earn superior investment returns. In fact, all ten had negative returns over the period examined and only three of them did better than the naive strategy of backing the favourite.

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“…Due to our successful identifications of mispricings in sports betting markets, we were able to build a betting strategy that consistently generates profit across several different sports. 1 Snyder (1978), Vergin and Scriabin (1978), Ali (1979), Losey and Talbott (1980), Hausch et al (1981), Asch et al (1984), Zuber et al (1985), Thaler and Ziemba (1988), Sauer et al (1988), Gandar et al (1988), Camerer (1989), Golec and Tamarkin (1991), Woodland and Woodland (1994), Dare and MacDonald (1996), Gray and Gray (1997), Avery and Chevalier (1999), Kuypers (2000), and Lee and Smith (2002) have commented on the efficiency of various sports betting markets.…”

Section: Introductionmentioning

confidence: 99%

Beating the House: Identifying Inefficiencies in Sports Betting Markets

Ramesh,

Mostofa,

Bornstein

et al. 2019

Preprint

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Inefficient markets allow investors to consistently outperform the market. To demonstrate that inefficiencies exist in sports betting markets, we created a betting algorithm that generates above market returns for the NFL, NBA, NCAAF, NCAAB, and WNBA betting markets. To formulate our betting strategy, we collected and examined a novel dataset of bets, and created a non-parametric win probability model to find positive expected value situations. As the United States Supreme Court has recently repealed the federal ban on sports betting, research on sports betting markets is increasingly relevant for the growing sports betting industry.

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Back on the Track with the Efficient Markets Hypothesis

Cited by 17 publications

References 7 publications

Can forecasters forecast successfully? Evidence from UK betting markets

Can forecasters forecast successfully? Evidence from UK betting markets

The horse racing industry and the efficient markets hypothesis

Beating the House: Identifying Inefficiencies in Sports Betting Markets

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