Friday, 26 January 2007

A Missed Opportunity

This hurts, perhaps, a little more than it should.

For the last few days I've been scratching my head searching the markets for opportunities to trade. I'd drawn a blank until last night when I reviewed the prices for the final test between South Africa and Pakistan.

The match is being played in Cape Town so I checked the weather forecast and plenty of sunshine was predicted. I also checked the stats for the ground and with an 80% history of results everything seemed to be pointing away from the draw. However, the price on the draw was very short at only 3.30. After reading some more pre-match reports and discovering that both teams were suffering from tiredness I was even more convinced that this game would end in a result.

But...I didn't trade!

I was stopped by the fact that some recent matches that had ended with a result had started with a big innings. The average first innings score was around 370 so by my reasoning, should this happen again, then the price of the draw would shorten a little further - perhaps to 2.80. My decision was to wait until this happened and then lump on with a 'lay'.

I've now just come home from work to open my position, but unfortunately it looks like this one got away - 15 wickets have already fallen and the price of the draw is now 40!

I'l learn from this lesson and won't think twice next time.

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