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The Eurovision Book: A Basic guide

This guide was written by one of our contributors, DurhamBorn.

In this article, I hope to answer the question of what a book is in terms of betting for Eurovision and the basics of setting one up.

These are questions most new gamblers never ask and it’s the reason why most of them lose more often than the more experienced professionals.

Tipsters often receive abuse from other gamblers over losing bets, but had the gamblers understood the book concept, it would be impossible for them to lose.

One of the first things you learn when working for a rails bookmaker at a horse racing track is how to price up a book.

In horse racing the bookie will assign a 2% overround per runner for the first 10 runners, then 1% per subsequent runner, plus 5% for the book. Therefore, in a 12-runner horse race we would expect the overround to add up to 27% (127% book).

It sounds very complicated. [ed: it is!]

Basically, what that means is, whatever horse wins the race the bookie will win 27% of the money placed. If the bookmaker took 120 different bets that added up to £1000, no matter what horse wins, the bookmaker should profit around £270. They’ve won from the moment the race starts, and over time, it means it’s almost impossible for a punter to win. The 27% margin is far too great for even the most informed person to overcome.

Let’s expand this into Eurovision terms and pretend we have a Eurovision final with only four runners: Armenia, Ukraine, United Kingdom and Russia.

What would a 100% book look like?

Well say we have £10 to bet and we want to win back that £10, a 100% book would be priced like this:

  • Armenia @ evens (2.0):  £5 to return £10
  • Ukraine @ 3/1 (4.0): £2.50 to return £10
  • UK @ 4/1 (5.0): £2 to return £10
  • Russia @ 20/1 (21.0): 50p to return £10

So this book demonstrates that whatever happens, we’ll always get our £10 back; we can’t win, but importantly, we can’t lose either. This is a 100% book.

There is currently no profit for the bookmaker, so they adjust the book to turn a profit. They factor in the overround. Reusing the example above, the bookmaker would look to build in a profit of 2% per runner and an additional 5% for the book, which roughly amounts to a 13% profit on a small field.

The four-runner Eurovision market would now be priced like this:

  • Armenia:  1.75
  • Ukraine: 11/4 (3.75)
  • UK: 7/2 (4.5)
  • Russia: 16/1 (17.0)

Spending that £10 again, one can appreciate how the bookmaker is set to profit:

  • £5 on Armenia to return £8.75
  • £2.50 on Ukraine to return £8.75
  • £2 on UK to return £9.00
  • 50p on Russia to return £8.50

Whoever wins the bookie profits between 10% and 15%. You lose!

Remember the bookie can set the prices and continually move them. If everyone is backing a single runner, the firm will cut its price and push the other runners out to longer odds. That will inevitably put people off backing the favoured outcome and tempt punters to back the other runners. In changing the prices, the bookmaker will ensure the overround is maintained.

If there aren’t enough punters, the bookmaker will struggle to achieve a perfect overround, but over time that average 13% will ensure the firm always wins.

Having read how bookmakers build and price a book, hopefully you understand that it is very difficult for the average punter to turn a profit. The bookmakers are businesses and their aim is to win. However, there is website that allows you to build a book, change prices, and ultimately act as the bookmaker. That website is Betfair.

Betfair is the perfect market, and as long as there is sufficient liquidity, it always trades around the 100% mark. Betfair is a level playing field where skill and knowledge can turn a sound profit.

Hopefully you now appreciate the set up and pricing of a book. In simple terms the closer the book trades to 100% the less skill and knowledge you need to win. If you are in the top 51% on a 100% book long-term, you will win. To hold a long-term advantage over a bookie pricing between 110% and 130%, you will need to be a world class expert. That invariably results in account restrictions and closures.

Eurovision bookmakers often make pricing errors, and by using odds comparison sites, it’s possible to spot the mistakes and ensure you beat the overround. When placing bets, it’s always important to consider what price you make a particular outcome. Just because one price looks high in comparison to others doesn’t make it a great bet.

One former bookmaker offers some useful advice:

I would advise all customers before having a bet, to have a quick scan of the market and use an overround calculator to work out how the market has been priced. Opportunistic bookies will often price markets to horrific margins, especially when they’re the only bookmaker offering odds.

I would rarely have a bet on a market priced above 140%, but ultimately the key thing is the difference between the price offered on YOUR selection and the price you make it. The shrewdest customers in my experience want to see a selection price 15% plus bigger than their 100% line (100% line is a market without any margin, eg a toss of a coin where both heads and tails are offered at evens).

So back to Betfair and lets illustrate the beginning of a Eurovision book.

One would start building their book from the point of the Eurovision market first opening, but here I will demonstrate the market as it was in March and only include the top seven in the market. The Betfair book trades around 100% but the examples below will not, as they are only part of a much larger market.

25th March 2014

  • Armenia: 2.08   -100
  • Sweden: 8.4        -100
  • Denmark: 16.5      -100
  • Norway: 14.0       -100
  • Hungary: 19.0      -100
  • Ukraine: 28.0       +1400
  • UK: 27.0             +1350

The market above illustrates a total of £100 spent so far.  I will now explain how I propose to trade and balance those as best as possible before the final.

In the example above, I reckon that Ukraine and UK are priced too high and I’m betting based on my belief they will shorten in price as the final nears. In my opinion, the other runners are fair prices or might drift, so I put £50 on Ukraine at 28s and £50 on UK at 27s. If the final was run today, I would lose £100 if any of the first five countries won, so as the UK’s and Ukraine’s price shortens, I would look sell off my original stakes for a guaranteed profit or free run. I would not be required to add more funds to accomplish this, as I already have equity in those nations.

If successful, those red nations would appear green and it would be impossible for me to lose. Plus, I would have two reasonable green bets without having spent a penny! If I wanted to lock-in a guaranteed profit, I could sell off the rest of my equity and let the event run, knowing I was a winner whatever the outcome.

It’s the reverse of trading stocks and shares; you buy high and sell low, rather than buying low and selling high. Trading a market means your book is more fluid and can follow current opinion. If you suddenly lose faith in a nation’s chances, you can trade out of that position and redirect your funds. With a bookmaker, you’re stuck and have to let the bet run.

If you have any thoughts, comments or questions, simply add them below.

 

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About Gavster

Owner & Chief Editor   I’m a qualified designer and the official geek in the crew, dedicating most of my free time to keeping the ESCtips show on the road. My family routes allow me to support the UK, Ireland and Italy.

27 comments

  1. Thanks Gav for the needed edit.Yes, if anyone new or experienced has any questions or comments at all on the above simply add them below.Also if anyone wants to follow how i/we will attempt to trade that book profitable from the above real life prices the link to follow the Betfair win market is here

    http://www.betfair.com/exchange/special-bets/market?id=1.112178677

  2. Very interesting Durham, I have to admit, even though I really went for it last year, I didn’t completely know what I was doing and I wasn’t thinking the right way. This year, (after some practice last summer) is my first year seriously trading Eurovision on Betfair, and this is actually a dimension to keeping a book I wasn’t previously aware of. It’s definitely given me some good insight into how bookies work, and I have to admit, I haven’t taken the same level of care when building my own book up this year. However, thanks to the knowledge I do have of Eurovision, I am still fairly comfortable with my book, and I am relying on an eventual trade to turn my whole book green. Meanwhile I have just been very carefully shaving off bits of my red on the top contenders where I see good value. This unfortunately still spells a total wipeout for me should Sweden or Denmark win, but I am feeling quite hopeful that my trade will work.

    After that, my plan is to use the equity gained to back my choice of winner as much as I can. I’m not keeping an overround, because I really don’t have enough of a mathematician’s head for that, (which is why I’ve avoided EW bets this year, I can’t understand fractional odds beyond “?/1” to begin with,) but I’m relying on hard knowledge and experience of the contest itself to win.

    • Thanks Ben.Yes it can seem quite daunting Betfair at first but the beauty is you can learn to trade and balance (or try to) with a very small amount.Someone could start with as little as £10 and trade a few £2s and have an enjoyable time doing it.Iv traded on Betfair from when it first opened.At first it was to lay off bets for the rails bookmakers.The smart ones learned they could have a smaller overround on course,take much more than their rivals in turnover and lay off on Betfair with no risk.Before Betfair the big bookies could easily shorten in the SP on horses by having their person at the course back the horse and bring its price down.Betfair stopped them being able to do that as much as betfair become the market,not even the betting shop money.

      Its interesting you mentioned your plan is to trade some profits and then use that profit to back your favoured entries.Again thats a very valid way to use Betfair.It means you can enjoy the season and then use the traded profits to have a risk free finals night.If the two trades (UK,Ukraine) move in the right direction we will touch on what can be then done,ie a free run on the same bet,a traded profit to use on another bet or a mixture of both.Even iff prices move against you,Betfair gives you the chance to at least limit your liabilities.

      I didnt touch on the lay side in the article as i think it will be best to approach that for new people in the comments section if and when it comes up.

  3. Unibet has opened top10 market. I’ve taken a few: Azerbaijan NO @ 5.0, Russia NO @ 1,72. Austria YES 4,5. Poland YES @ 6.0, Ireland NO @ 1,3 (I’ve backed Ireland top10 @ betfair at odds of 11, and a few euros even higher thant hat. Someone has gone mad). The last one I took was Italy NO @ 1,72. Another one I’m thinking about is Finland @ 8.0 but for some reason I’m vary to get on that.

    • I back the Italy NO bet yesterday. Where possible, I would recommend people don’t use Unibet, as they move their prices much quicker than 888.

    • Iv just taken that Poland YES@ 6.0s and Belgium NO at 1.72 Archi.I sent the lot to traders expecting them to refuse but they took it.Amazed.They must be planning on trying to run a big top 10 book this year and upped limits.I reckon Poland will go 3.0s on Betfair once they qualify.

      • Yeah I did the same, at first they agreed to like 8€ or whatever but after sending them to traders most were accepted fully and two came back partly accepted. But I was surprised as well 🙂

        The Poland 6.0 @ top10 seems high right now and I’ve taken a lot of it at Paf, unibet, 888 and earlier at betfair. I’m probably going to even it a bit @ betfair as the risk is rather high right now but I wouldn’t feel too bad letting it run as a whole actually. The only worry I have is that they will somewhat ruin the song by turning it into English/Polish version :/

  4. Not keen on either of those bets until rehearsals.

    • You rarely seem to be unless it’s an outright bet 🙂 Do you make bets other than outright’s before rehearsals? Sure, I realize there is a risk if they completely fail to deliver but the same risk lies in the outright market.

      • I have backed UK (@ ave 2.4), Ukraine (@ ave 1.62), Estonia (@ 9s) for top-10 and Italy NOT top-10. I also agree with your Russia bet. Poland however, is bilingual, might contain over-sexualised staging and Cleo could come across as being too fierce.

        Given that Hungary were 8.0 on the day of the final, I don’t want to gift money to the bookies until I know more about the staging.

        As for Belgium, I’m a fan of it, but current odds for top-10 are ludicrous.

        The article above quotes:

        “the key thing is the difference between the price offered on YOUR selection and the price you make it. The shrewdest customers in my experience want to see a selection price 15% plus bigger than their 100% line”

        In my opinion, both of the bets touted should be priced higher.

  5. Yes I agree with the risks you have about Poland. And I do acknowledge those risks. Somehow I’ve still convinced myself 6.0 is good enough 🙂 Oh well, we’ll see I guess.

    Those are some nice prices you have on top10 market actually. I’m personally not convinced on UK though, but the price is nice compared to the current ones.

    • I have UK very heavy top 10 at 2.52,no doubt at all i can get a good free run as i expect it to go to 1.7.Iv got Estonia as well top 10 at average 6.0s.I have Ukraine at average 1.58.So those same as Gav.Poland now at 6.0s same as Archi and iv also got some Slovenia at 6.6.I expect to get a free run on that once the ESC version is released tomorrow and people hopefully see the quality i know is there.I dont expect anyone to agree with that one but i think il get if free before the risk of the semi.
      I think Poland is overpriced by a long way.I also though do agree though with Gav people who are cautious should wait for rehearsals.It could be great or a car crash.
      Probably a year where most of us agree on some and disagree on others.

      • I make Slovenia over 8s, especially considering Maja Keuc only got 13th with a far more marketable song.. Plus Slovenia have lost some support compared to their 2011 allies.

        I reckon UK goes lower than 1.7, Durham. I think they’re a 1.4 shot at worst.

        • Yes 1.4 should be in range.Il be trading out at 1.7 though for a free run as im far too heavy on it to run it all and want to release the equity, even though i expect it to land.
          Maja Keuc was a superb singer but the staging was weak.She got in the top 3 in the semi but following Running Scared proved a disaster in the final.She only got votes from the Balkans really.The producers and juries will need to lend a hand with the lack of allies for Slovenia.

  6. I agree with Slovenia. Or at least I’ve backed them at 7.0 @ Bwin 🙂 I’m not too sure about it but at that price I dont even have to be. Sure, a lot can happen between now and beginning of SF1 but for quite a few years now my strategy has been to shovel money on bets I feel are good and see what happens. It tends to work more often than not so I don’t feel the need to change my top notch strategy 😉 Oh I also have Greece avg. at 2,7 to top10. And I’ve backed them outright as well average 220. I think it’s a solid party song and can get people going. I hope they keep rapping to the minimum though. I dont expect it to win but I do feel it has a solid chance to shorten quite a bit.

  7. Quick question while you are at it.
    Where do you guys currently stand on Romania’s top10 prospects?

    • All depends on the staging for me shell.So waiting to see that.Cant see it shortening between now and rehearsals.

    • Well I’m waiting on the stage show. It’ll be interesting to see if the juries go for it, or whether they prefer Estonia

    • Romania vs Estonia is a tricky one. Romania have the, in my opinion, stronger song and voting power, (although the big Balkan hole makes that a bit questionable) but Estonia by far have the better performance skills. Paula and Ovi rely on props and gimmicks.

    • do you know for some strange reason i keep coming back to Romania to actually win the whole darn thing… the top 10 is a lock for me.

      i’m having to reassess a lot of the songs i dismissed out of hand. it happens every year. this includes Romania, France and Ireland to name but a few.

    • I have been laying Romania for top 10, it’s my biggest lay so far.

  8. As big a fan as I am of Poland I have to agree with Gav. I don’t see the 6.0 as value yet for top ten until we have seen rehearsals. Took the 8.0 on Finland top 10 small bet as I think it’s the best value of the scandi nations and most underestimated song this year. Romania is certain top 10 for me certain high tele vote and probably only need to finish in top 13 of jury vote to finish top 10 which is very achievable . It’s another I have backed @ 1.97 avg along with the UK @ 2.44 avg. Slovenia would want to be at least 11.0 before I would even consider it for top 10.

  9. We could now trade out of the trading position put up in the article for good free runs and/or a no lose balanced book,if we now layed back our £50 each on Ukraine and the UK on Betfair now with money up there wed get this,

    25th March 2014 Win/Lose Today 10th April 2014 Win/Lose

    Armenia: 2.08 -100 Armenia 2.42 0.00
    Sweden: 8.4 -100 Sweden 5.2 0.00
    Denmark: 16.5 -100 Denmark 15.5 0.00
    Norway: 14.0 -100 Norway 19.5 0.00
    Hungary: 19.0 -100 Hungary 28.0 0.00
    Ukraine: 28.0 +1400 Ukraine 27.0 +50
    UK: 27.0 +1350 UK 20.0 +350

    So if we wanted to we could now win £50 if Ukraine win Eurovision and win £350 if the UK win.If none of them did we would lose nothing.We could now have two “free runs”.

    We could instead decide we want to make money now on them all for free.As we now have a free £350 on the UK we simply “lay” the UK for £10 at the 20s to take away £190 of the profit.Then the “book” would look like this.

    Armenia 2.42 +10
    Sweden 5.2 +10
    Denmark 15.5 +10
    Norway 19.5 +10
    Hungary 28.0 +10
    Ukraine 27.0 +60
    UK 20.0 +160

    So we now would have a free ,no lose book where we win whatever happens.

    I think both Ukraine and the UK will shorten more as Sweden joins Armenia in a drift so we will assume we havent traded out yet and will hold our nerve on the example but i hope that shows anyone new or not experienced in Betfair the beauty of it when used for ESC betting.

  10. Im 90% traded out on the UK and Ukraine now for free runs.Someone just took out the 18s i had up on Ukraine in one go so im running 12.5pts free on that and 10.5pts free on the UK.Will run them both as free runs and no trading profit.
    Iv got some Poland at 134s, Italy 74s ,Slovenia 360s ,Romania 85s and Estonia 217s.Those are to much smaller stakes.They take the rest of the book apart from Uk/Ukraine red slightly so hopefully one or more shorten rehearsals week/after semis so i can use them to turn the rest of the book green.

    I was going to lay Sweden heavily at 4.0s but missed it by the time i had free equity.If it comes back in il lay it.

  11. If anyone is following the 2 trades i put into the article or joined in on them they are now in a very good position.Both have been backed the last few days and the bookies all shortened Ukraine heavily today and that forced the price right in on Betfair.Iv just had my last 10% of Ukraine matched at 14s.I expect the UK to shorten more but iv also now traded that right out.

    So for the sake of rounding the article off and showing the power of trading the book we will consider we close out those two trades at the prices on BF theyd go for now,18s UK 14s Ukraine.So we lay them both for £50.

    So now our book would look like this,

    Armenia 2.6 +0.00
    Sweden 4.4 +0.00
    Denmark 17.0 +0.00
    Norway 26.0 +0.00
    Hungary 22.0 +0.00
    Ukraine 14.0 +700
    UK 18.0 +450

    So if Ukraine win ESC we win £700,if the UK win ESC we win £450 and our original £100 is safely back in the bank.We cant lose anything.

    Myself i think the Ukraine mainly but also the UK are strong challengers and id run those bets.Perhaps though youd like to make a free profit if any of the above win.We can do that as well.

    We now lay Ukraine for say £30 @ 14.0s and we lay the UK for £10 @ 18s.That gives us £40 to bet with so we split it into the other 5 so £8 each.+£40 for the lays on UK/Ukraine

    The book would now look like this

    Armenia 2.6 +42.50
    Sweden 4.4 +72
    Denmark 17.0 +184
    Norway 26.0 +236
    Hungary 22.0 +214
    Ukraine 14.0 +310
    UK 18.0 +270

    So our original £100 is safely back in the bank.We cant lose anything.If any of the above win ESC we win the amount next to them.So if our original stakes had been £5,£500,or £50 as in the example we would be sitting pretty.

    The key to the above is following ESC (and ESCtips) early,figure out the likely acts to shorten (or drift if laying) and then take positions.

    It can seem a bit complicated but hopefully its given people an idea of how to trade/balance a book.

  12. Well done durham, that example worked out nicely for you

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