Trading the Ryder cup

26/09/2014 | By | Reply More

Once every two years the sporting world turns its attention to what is turning into a classic sporting Rivalry, the Ryder Cup.

Many years ago it didn’t have anything like the profile it does now. Post war it was a chance of US golfers to show how much better they were than UK players. Then the rules changed to make their opponents UK and Ireland but that was still dominated by the US. Then in 1985 when it became the US and Europe and the real rivalry began. Both sides are desperate to win now and this is what really stokes up the tension and rhetoric each time.

The market

From a trading perspective there are many markets but the main market is, obviously, the winner market. You can pick either side to win or the whole tournament could end up even. Volume on this market has risen from £12m in 2004 to £21m in 2012.

The odds

The miracle at Medina was the most spectacular trading market yet on this tournament and the US traded as low as 1.06, Europe at minimum odds and the Tie 1.12; it was amazing. You must google that Ryder cup for a real sense of the drama. If you had laid each at their lowest point just once you would have returned nearly 300% on your stake.

Obviously closer tournaments produce better trading conditions but past prices before the off in past haven’t been great guides for how the tournament will play out. The favourites since 2004 have started at 1.67, 1.96, 2.07, 1.62, 1.90 and this year 1.74. There has been little correlation so far, in Betfair’s history, between SP and the winning margin of either side. Since 1985 there have been two 9 point wins but everything else has been much tighter, 71% of competitions have finished within 3 points or less. So it would seem sensible to point to another close contest.

In the post war period there have only been two ties, once in 1969 and again twenty years late. Maybe the next will be in 2019, LOL? But that only correlates to a 5% chance or odds of 20. The tie is currently at 13. Curiously for something that doesn’t happen very often the tie has shortened quite a bit in play over the years. In 2004 and 2006 when Europe ran away with the tournament it hardly shortened at all. But subsequent years is has touched 6 & 4’s respectively before the drama at Medina when it looked like a tie was quite likely. So if we expect a tight result then the draw will certainly shorten. For this to happen we need the US to get a strong start.

In the exchanges history backing Europe has been a slam dunk, but that’s no surprise at they have won it four out of five times since decent records began in 2004. But it’s interesting to note that all prices have generally shorted. But thanks to the how tight things get prices have also drifted a lot as well.

Sometimes it’s better to look to exceptions for guidance. In 2004 Europe drifted from 3.10 to 3.65 on the way to thumping the US and a year later when repeating that feat they drifted from 1.96 to 2.14. Basically it seems whatever trading position you take at the off it will pay to some extent, but again it’s how competitive the competition is that will determine the size of the swing. If you want to take a lower risk position you may want to lay the draw (tie). Previous years this fly arounds all over the place as we near the end and it’s likely to produce several chances of a pay off.

But probably the most sensible strategy over all is to lay Europe at odds on near the start. If the US come into the competition at some point their odds will also shorten to odds on and you can trade out by laying them for a profit overall. The underlying premise is that if you lay two things under two, you are guaranteed a profit. You can then use that profit to do whatever you want through the rest of the tournament.

The teams

The absence of Tiger Woods may actually be a help to the US this time round. There has always been this underlying competitive tension in the US team and that will be absent this year. Matchplay golf such as the Ryder cup is definitely a team event and Europe has benefited from the sense of camaraderie.

Golf is a game of confidence as much as skill and therefore players in form will do well and the pairings will need to reflect this dynamic, it’s going to be interesting to see how the captains select the players.

In form for the US in descending order Fowler, Furyk, Reed, Walker, Bradley, Mahan; for Europe, Dubuisson, McIlroy, Donaldson, Garcia, Stenson, McDowell, Rose.

Out of form for the US, Mickleson, Watson, Kuchar, Johnson, Simpson, Spieth; For Europe Westwood, Gallacher, Bjorn, Poulter, Kaymer.

After making his first appearance in 1997 I reckon this will be last for Westwood. His vital stats are in decline this year and masked only by a good performance on when putting. Poulter hasn’t had a great season but his performance in the Ryder cup has been epic so it will be interesting to see how he performs.

You will notice Europe are slightly better off in that mix and that is reflected in their lower starting price, as is home advantage. US players play worse on Ryder cup tournaments played in Europe, probably because none of them play here regularly. But the opposite is true for Europeans as some do play on the US tour. While we have a small sample set for the Ryder cup this does appear to be a characteristic.

So there is lots going for the European’s, but they have some baggage in the mix, but so do the US as well! Home advantage will probably see the Europeans through, but I’d imagine the US with Watson at the helm will put up a good fight, looking to correct their poor recent record.

I’m looking forward to the action!

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Category: Golf, Trading strategies

About the Author ()

I left a good job in the consumer technology industry to go a trade on Betfair for a living way back in June 2000. I've been here ever since pushing very boundaries of what's possible on betting exchanges and loved every minute of it.

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