The Power of Real Options in Games Betting: An Application of Switching Options

Shin-Yun Wang

Journal of Gambling Business and Economics, 2009, vol. 3, issue 2, 1-14

Abstract: There are varieties of real options, which include shrinking, expanding, switching and abandon options. This paper applies a switching real options approach to the game betting which allows the gamblers to switch between teams during the game. The volatility of odds is not only a source of concern for the gamblers but also a source of profit opportunities. In this paper, we combine features of the odds volatility and options to switch and find that with low switching cost, gamblers can exploit the variability of a team's odds volatility to increase their profits.

Keywords: REAL OPTIONS; SWITCHING OPTIONS; BETTING; ODDS; GAME (search for similar items in EconPapers)
JEL-codes: L83 (search for similar items in EconPapers)
Date: 2009
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.ubplj.org/index.php/jgbe/article/view/544 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:buc:jgbeco:v:3:y:2009:i:2:p:1-14

Ordering information: This journal article can be ordered from
http://www.jgbe.com/index_files/Page492.htm

Access Statistics for this article

Journal of Gambling Business and Economics is currently edited by Leighton Vaughan Williams, Nottingham Business School

More articles in Journal of Gambling Business and Economics from University of Buckingham Press
Bibliographic data for series maintained by Dominic Cortis, University of Malta ().