Ask HN: Are there any hedge funds incorporating sports bets in their portfolios?

2 points by JumpinJack_Cash 35 days ago | 2 comments

I notice that HN has a super anti sports bet bias so before you jump me considerate the uniqueness of sports bets in the vast landscape of financial bets one can make.

1) It's the only field in which you don't need the consensus to solidify around your position in order to make money, as a matter of fact you HOPE that the consensus doesn't solidify around your position until the gameclock reaches 0:00 and your prediction becomes true.

2) Thanks to prediction markets though (and the already known betting exchanges such as Betfair and the huge landscape of Asian ones), a sport bet can also be liquid meaning that you can also profit from consensus solidifying around your bet.

3) The market can stay irrational more than you can stay solvent, that is a recurrent theme in investing but with sports bets you have a hard deadline for the market to resolve and gain its rationality back as opposed to the normal markets which can stay irrational forever because the public can be captured by yet another narrative once one loses steam.

4) UHNWI tend to hangout together so the investors and the administrators of a hedge fund could have access to the actual players deciding the outcome of games and thus they could accurately judge their mental and physical form and if needed be they could also persuade them to make a determinate result happen..

What do you guys think? Why hasn't this sort of fund develop yet ? At least publicly?

Do you think hedge fund already incorporate sports bets in their portfolio but they do it in secret?

A_D_E_P_T 35 days ago |

> 4) UHNWI tend to hangout together so the investors and the administrators of a hedge fund could have access to the actual players deciding the outcome of games and thus they could accurately judge their mental and physical form and if needed be they could also persuade them to make a determinate result happen.

lol, I think the mob tried this back in the 1920s. It's one of the most obviously illegal things you can do, and would get your fund shut down in a heartbeat the minute it's exposed.

As to the rest of your post, I'll put it like this: If you invest in stocks, the odds are structurally stacked in your favor. (This wasn't always the case, but has been the case for a while, and there's no indication that it's going to change any time soon.) If you wager money on sports, the odds are always against you. Why would a hedge fund (think about this for a second) throw money away on such wagers?

I can imagine a hedge fund that takes bets and separates fools from their money, but most or all of them have anti-vice policies and would never countenance such a thing.

JumpinJack_Cash 35 days ago | |

> the mob tried this back in the 1920

To notice that Lebron is depressed because he had to put down his dog and bet that his depression will influence his performance on the court is illegal?

> Odds are structurally stacked in your favor. (This wasn't always the case, but has been the case for a while, and there's no indication that it's going to change any time soon.

This is just an assumption based on nothing, on the other hand it's true from first principles that you need people to agree with you to make money in stocks whereas in sports bets you not only don't need those but actually hope that people are taking the other side of the bet

> If you wager money on sports, the odds are always against you.

The house edge can be compared with other costs that hedge fund incour when they trade stocks, also they are not present on prediction markets and are very slim on betting exchanges such as Betfair