WO2004003803A2

WO2004003803A2 - Method for wagering

Info

Publication number: WO2004003803A2
Application number: PCT/IL2003/000547
Authority: WO
Inventors: Elazar Shachor
Original assignee: Elazar Shachor
Priority date: 2002-07-01
Filing date: 2003-06-30
Publication date: 2004-01-08
Also published as: AU2003237573A8; WO2004003803A8; IL150501A0; AU2003237573A1

Abstract

The present invention generally relates to a method for wagering, and particularly to a method for calculating fixed-odds betting on either a single event or on multiple events. More specifically, the present invention relates to a method for wagering on sport games and business events. The method is especially useful for a player to wager with a bookmaker on the probability of winning in at least one event, and comprises: a) obtaining a data base, comprising predetermined data concerning the said event; b) estimating the probability of the outcome of said event; c) indicating said probability on said data base; d) transacting predetermined amount of money from the player to the bookmaker; e) obtaining the outcome of the said event; f) calculating the payout to be transact from the bookmaker to the player; g) in case of obtaining positive payout value, transacting said calculated payout from said bookmaker to said player.

Description

METHOD FOR WAGERING

FIELD OF THE INVENTION

The present invention generally relates to a method for wagering, and particularly to a method for calculating fixed-odds betting on either a single event or on multiple events. More specifically, the present invention relates to a method for wagering on sport games and business events.

BACKGROUND OF THE INVENTION

Bookmakers enable their bettors to place wagers on events, such as sports competitions and matches. The events are characterized by the fact that bookmakers do not have the ability to control or set the statistical distribution (or data generation process) of any event's prospective outcomes.

The most common type of betting offered is the Fixed-Odds Betting. Several inventions were presented, as such as the U.S. Pat. No. 6,033,308 to Orford et al. This patent discloses a combined totalizator and fixed-odds betting system able to be operated by a central computer connected with communication links to a large number of betting terminals. During the lead up to the race, the fixed odds dividend to be paid is adjusted for each runner in stages, in accordance with the potential liabilities arising at each stage, from the bets to date as the pool increases in size towards race starting time.

Basic principles of the aforementioned type of betting are as follows: Suppose the event has N possible outcomes as defined in Eq. 1 below:

N

^ Pr obability (outcome _t ) = 1 (1)

Bookmakers offer odds on prospective outcomes of the event. It is generally acknowledged that odds offered on OUtCOme_i are Odds_i . Hence, a player bets on OUtCOTne_i , and this

outcome is the realization of the bet, the player then receives Odds₍ multiplied by the amount wagered on that outcome. Odds are bounded by Eq. 2:

wherein the sum of all outcomes prices is greater than 1; otherwise, the opportunity for arbitrage profits arises. The latter expression is referred to the term "Profit Indicator".

The payoff rate (i.e., the expected return from a unit stake) of betting on OUtCOTYie_ι is calculated according to Eq. 3 :

Pr obability (outcome_t ) x Odds_l (3)

Bookmakers are expected to make profits when Pr obabilit ' (outcome^ x Odds is less than unity. As mentioned, Boolαnakers do not know the exact probability of each outcome and seek to estimate it in the best way they can. Generally, bookmakers use their probability estimates when setting the odds offered, and are expected to equate the expected return of all possible outcomes. When this occurs, the expected return (pay-out rate) equals

1 Profit Indicator

Each P, is denoted as defined below in Eq. 4:

^p. = Profit Indic ^"ator x Odds_l (4)

P_t is thus hereto referred as the subjective probability of OUtCOJTie, .

Boolαnakers may offer players to bet on more than one event. These wagering are called Parlays. Player selects one outcome from each event, and in order to win, all his selections must win. In case of winning, the player's return is the multiplication of all events winning odds, times the amount of bet. It is important to note that the pay-out rate diminishes as the number of selected events in that parlay form increases.

Other popular forms of betting systems include the Parimutuel-Betting (operators collect a fixed percentage from the betting pool and distributes the remainder amongst winners proportionally to their betting amount), the Point-Spread Betting (popular in North America), and the Handicap-Betting (popular in the Far East). The latter two are characterized as Fixed-Odds Bettings. Hence, U.S. Pat. No. 5,743,525 to Haddad presents a win pool payoff betting mechanism, especially adapted for horse races, enabled by the way a bettor picks a single number, selected from "0" to "9". Race entrants, are assigned different single or double-digit number, for a particular race. The system includes adding the numerical values of the numbers of the winning positions of the race horse entrants (typically first, second and third), with the least significant digit of the sum or total being compared with the bettor's selected number, and on occurrence of a match.

Another form of betting system is the P2P (e.g., person to person, or Exchange-Betting). Though these relatively new operations differ significantly from the systems that were mentioned, the final odds on a specific bet do not differ significantly amongst operators, and arbitrage opportunities in these markets are rare.

It is formerly acknowledged that U.S. Pat. No. 6,186,502 to Perkins introduces an embodiment of a fraud-proof multi-tiered method for wagering on a sports event. The method involves choosing a first criterion, dependent upon parameters that may be satisfied by the outcome of the sports event, and additionally having a second criterion, that will be determined by an independent randomly generated data value. Hence, the player is choosing a multi-variable data value that will possibly match the second criteria that will be determined by an independent randomly generated data value and choosing a multi-variable data value that will hopefully match the second criteria.

The betting systems that were listed are certainly not a full list. Spread-Betting is offered on events that enable operators to implement it's resemblance to the pay-out structure of financial derivatives, and games such as Toto-Pools are an example of Parimutuel-Betting characterized in high returns and low probability of winning. These systems are irrelevant to the presentation of the Proposed wagering method.

SUMMARY OF THE INVENTION

It is thus the object of the present invention to provide a method useful for a player to wager with a bookmaker on the probability of wining in at least one event of any nature, is presented. Said method is generally comprising the following steps: (i) obtaining a data base, comprising predetermined data concerning the said event; (ii) estimating the probability of the outcome of said event; (iii) indicating said probability on said database; (iv) transacting predetermined amount of money from the player to the bookmaker; (v) obtaining the outcome of the said event; (vi) calculating the payoff to be transact from the bookmaker to the player; and lastly, (vii) in case of obtaining positive payoff value, transacting said calculated payoff from said bookmaker to said player.

DETAILED DESCRIPTION OF THE INVENTION

The wagering method according to the present invention is based on bookmaker's estimations and odds. The principle of the method is that instead of selecting an outcome and the outcome's offered odds, the player is choosing his own probabilities to be wagered against the bookmaker's subjective estimations. The main innovation in the game is that it enables players to take positions that are unavailable or are very complex to apply. It is acknowledged that the profit indicator of any bookmaker is greater 1.

Thus, on a single event, for example, it is never optimal for players to place wagers on all element's outcomes. The only exception is the existence of Exchange-Betting operations, where players pay commission only on their net profit from any event. When it comes to betting simultaneously on more than one event, it is straightforward that parlay forms are a special case of the method (estimating one event's probability as a 100%), and that other positions are very complex for players to calculate.

It is acknowledged that the hereto-defined event (or events) is a sport game, race or any athletic competition of animals or men, an event (or events) having a business nature.

Under the proposed method, players have more control on losses and on the volatility of their positions. The game may also be attractive to players, since the payout rate does not necessarily diminish as the number of selected events increases. Sports betting sites are usually loaded with lots of contents and are challenged to use web pages parsimoniously and efficiently. The proposed method thus clearly assists in handling this challenge. Thus, reference is made now to Figure 2 schematically presenting one preferred embodiment of the present invention, wherein in Step A the data base, comprising predetermined data concerning at least one event is obtained by the player (i.e., the bettor). In Step B the probability of the outcome of said at least one event is been estimated by said player. Step C comprises the action of indicating said probability on said database by said player. Step D involves with the transaction of predetermined amount of money from the player to the bookmaker. In Step E the outcome of the said at least one event is obtained. Subsequently in Step F, the payoff to be transacted from the bookmaker to the player is been calculated. Lastly, in case of obtaining positive payoff value, transacting said calculated payoff from said bookmaker to said player. In case no positive payoff is calculated, no payoff is to be transacted and the wagering is ended.

According to another preferred embodiment of the present invention, the aforementioned database presented to the player is additionally containing indications for the subjective probabilities to win at least portion of said events. Those subjective probabilities are traditionally estimated by the bookmaker or by any third party.

It is in the scope of the present invention wherein the method for calculating the payoff to be transact from the bookmaker to the player is provided by the steps of (a) multiplying the probabilities of said at least one event's outcome estimated by said player; (b) dividing the obtained by the multiplication of the subjective probabilities, estimated by said bookmaker; and subsequently (c), multiplying the obtained result by said transacted sum of money.

It is further in the scope of the present invention wherein the said indication of said probability on said database is enabled by either remote or intimate indications. Remote indications are enabled by various means selected, yet not limited to telephones, cellular and wireless phones, facsimile machines, beepers, palms pilots, MIRS and personal computers; communication technologies, selected from SMS messages service, voice mail services, differential ring system; and for any computer-mediated communication networks, selected from internet, intranet, cable, optic fibers, electrical mediated means. It is possible to indicate the said probabilities by various means selected from a written matter, printed tables or electronic media. Additionally, those intimate indications are enabled by means selected from writing, erasing written data, signing, encoding, or any other suitable means to deliver a massage, data or information.

Reference is made now to Fig. 1 schematically presenting the above defined intimately indicated database comprising indications concerning the teams (or alternatively, the identities attaining a racing, athletic competition, a business operation etc), the subjective probabilities made by the bookmaker or by other identity, and the winning probabilities, as estimated by the player.

The predetermined amount of money to be transacted from the player to the bookmaker may possibly comprise a commission for handling said wagering. Said commission may be calculated and/or transferred to the bookmaker either before or after the end of the event. Alternatively or additionally, said commission may be selected from a fix price, percent of the wagering sum, percent of the profit obtained due the wagering or by any other means enabling the transaction of predetermined amount of money from the player to the bookmaker.

It is still in the scope of the present invention, wherein said method is adapted to provide the player to wager on at least one event. Thus, the player is indicating said database those events he wishes to wager; wherein the payoff to be transact from the bookmaker to the player is calculated only in those events that the bookmaker's subjective probabilities are different then the player's indicated probability of the outcome.

Lastly, The method according to the present invention, especially useful for data processing system, adapted for the formulation of multi-party risk management contracts. Said multi-party risk management contracts are selected, yet not limited to any event baring at least in its portion a business, military, sport, wagering or other nature. EXAMPLE 1

Suppose that the list of events contains 2 games with 2 possible outcomes (home team wins or visiting team wins). The list and the odds may look as follows:

Home Team Visiting Team Home Odds Visiting Odds

_______ _TEAM_₂ m

TEAM_3 TEAM_4 1.45 2.35

Table 1. The list and winning odds of match 1 and 2, according to Example 1.

From the odds we will derive the subjective probabilities:

Home Team Visiting Team Home- Win Probability Visiting- Win Probability ________ _TEAM_₂ 5₍j% 50%

TEAM_3 TEAM_4 61.85% 38.15%

Table 2. The subjective probabilities of match 1 and 2, according to Example 1.

The player now selects the list of games he wishes to bet on. It is assumed that said player chooses both games, however he may choose any number of events, and fills in his probability estimates.

Home Visiting Home-Win Visiting- Win Player's-Home- Player's Team Team Probability Probability Win Probability -Visiting-Win

Probability

TEAM_1 TEAM_2 50% 50% P_l 1-P_1 TEAM_3 TEAM_4 61.85% 38.15% P_2 1-P_2

Table 3. The Win Probabilities of match 1 and 2, according to Example 1.

The basic payout structure of the bet is the probability of the winning outcomes under the player's estimates divided by the probability of the winning outcomes under the bookmaker's estimates (i.e., Likelihood-Ratio). For example, if both games' result is a victory for the home team, the player's return is calculated as defined in Eq. 5 below:

P lxP 2

(5)

50% x 61.85% It is straightforward that under the bookmaker's estimates, the payout rate of this bet equals 1. House edge may be achieved in any traditional method such as imposing a vigorish on the wager amount, the winnings etc.

Claims

1. A method especially usefol for a player to wager with a bookmaker on the probability of wining in at least one event comprising; a) obtaining a data base, comprising predetermined data concerning the said event; b) estimating the probability of the outcome of said event; c) indicating said probability on said database; d) transacting predetermined amount of money from the player to the bookmaker; e) obtaining the outcome of the said event; f) calculating the payout to be transact from the bookmaker to the player; g) in case of obtaining positive payout value, transacting said calculated payout from said bookmaker to said player.

2. The method according to claim 1, wherein the database presented to the player is additionally containing indications for the subjective probabilities to win at least portion of said events.

3. The method according to claim 1, wherein the calculating of the payout to be transact from the bookmaker to the player by means of multiplying the probabilities of said at least one event's outcome estimated by said player; dividing the obtained by the multiplication of the subjective probabilities, estimated by said bookmaker; and subsequently multiplying the obtained result by said transacted sum of money.

4. The method according to claim 1, wherein indicating said probability on said database is enabled by either remote or intimate indications.

5. The method according to claim 1, wherein the remote indications are enabled by means selected from of telephones, cellular and wireless phones, facsimile machines, beepers, palms pilots, MIRS and personal computers; communication technologies, selected from SMS messages service, voice mail services, differential ring system; and for any computer-mediated communication networks, selected from internet, intranet, cable, optic fibers, electrical mediated means.

6. The method according to claim 1, wherein the intimate indications are enabled by means selected from writing, erasing written data, signing, encoding, or any other suitable means to deliver a massage, data or information.

7. The method according to claim 1, characterized that the database wherein the probabilities are been indicated is selected from a written matter, printed tables or electronic media.

8. The method according to claim 1, wherein the event is a sport game, race or any athletic competition of animals or men.

9. The method according to claim 1, wherein the event comprising a business nature.

10. The method according to claim 1, wherein the predetermined amount of money transacted from the player to the bookmaker comprising a commission for handling said wagering.

11. The method according to claim 10, wherein the commission is calculated and/or transferred to the bookmaker either before or after the end of the event.

12. The method according to claim 10, wherein the commission is selected from a fix price, percent of the wagering sum, percent of the profit obtained due the wagering or by any other means enabling the transaction of predetermined amount of money from the player to the bookmaker.

13. The method according to claim 1, adapted to provide the player to wager on at least one event, wherein said player is indicating said database those events he wishes to wager; wherein the payoff to be transact from the bookmaker to the player is calculated only in those events that the bookmaker's subjective probabilities are different then the player's indicated probability of the outcome. The method according to claim 1, useful for data processing system, adapted for the formulation of multi-party risk management contracts.