Why the Edge in RFQs isn't the Pricing w/ TroyCuban | Ep 156

This week SP and GP are joined by Troy (https://x.com/troycuban) to talk about how he has made over $700k on Kalshi this year despite never originating a bet in his life.

Troy is slightly different than our typical guest (only slightly) in that he comes from a traditional finance background and now only does RFQs full time. This could be the deepest dive recorded into the most important market on Kalshi!

0:00 Intro to Sports Betting
29:00 Everything RFQs
1:19:00 Listener Q&A

Welcome to The Risk Takers Podcast, hosted by professional sports bettor John Shilling (GoldenPants13) and SportsProjections. This podcast is the best betting education available - PERIOD. And it's free - please share and subscribe if you like it.

Follow SportsProjections on Twitter: https://x.com/Sports__Proj
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Transcript

SPEAKER_02 0:00

Any model that you're gonna find, especially for like same game parlays, isn't I mean I don't even think anyone has one yet that's like the nuts that like every is an industry standard that everyone could like copy. So I mean it's more so just slap a line up there and limit anyone who gets you.

SPEAKER_03 0:40

Uh welcome to the pod Troy Cuban uh on Twitter and on Cal Shi. Uh very successful trading uh track record so far. And yeah, just thanks for thanks for joining the show. These are the episodes that that SPA and I love to do where you know it's some talking to somebody who hasn't necessarily been on a ton of pods, but is is out there crushing it right now.

SPEAKER_02 1:05

Yeah, my pleasure. Big fan of the show.

SPEAKER_03 1:09

Thank you.

SPEAKER_01 1:10

Yeah, so full disclosure, we we had a guest lined up. It wasn't Troy. He fell through. So Troy is is breaking the record for the shortest amount of time introduced to to come on the show, actually being on the show. This was a one truly a one-day turnaround. So Troy is the MVPs for you know, all you listeners, you need to thank Troy. Otherwise, it would be me and GP doing another you know solo two hours, which I know you know all you love, but you know, I know the interviews are what you really, really want. So, Troy, Troy, thank you for rescuing us. Why don't we start with with where where you got into betting, your first gambling in general, um, maybe give a little context on like how old you are and when you got started and and just some some broad introduction.

SPEAKER_02 1:53

Yeah, sure. Well, I'm 28 now. Uh, I guess first time gambling. I mean, you guys are gonna love me for this. I'm a child prodigy. Uh I go to uh I go to Florida with my family uh for Christmas and whatnot. And they had uh when I was like 10, they had a greyhound track there, and my dad would take me to that once or twice. And when I had my Christmas money, like in the few days before we would go home, uh he would bet some greyhounds for me. And uh, my mom, my grandma hated that. Uh, but we'd go and do it anyway, and just yeah, kind of sketchy crowd there and come back smelling like black and mild. And that was really like the first time I was betting, and then uh then it was maybe when I was 19, I actually got into like options trading uh and really had no edge there. Like I was just straight like college kid punting on Robin Hood. Uh and then with my college friends, you know, play a little bit of poker, do a little bit of sports betting. Uh, and then just kind of learned, tried to get a little bit more in the options trading because I was in finance and got some of those sites that I guess would be similar to what unabated is now, but for options trading. And you kind of learn from not winning at that. You gain sort of a respect and humility for markets, uh, and that you're not gonna beat anything with real liquidity that someone's actually competing in, you know, just reading like some charts or reading CNBC while you're taking a shit in the morning. So I kind of yeah, then I then I got into sports betting, uh, got much more into the top-down stuff, uh and then actually started making money and real gambling. Uh, and it never was anything like big. I probably my best year top-down betting was maybe a little bit over a hundred grand a year. Um, but it was just typical like Oz Jam stuff, Oz Cream stuff, and just you know, turning over FanDuel accounts, DraftKings accounts, rivers, offshores, bovada, you name it.

SPEAKER_01 4:23

So let's go back, let's go back to the, you know, when you were. I'm glad you had an origin story at like 10 years old. That that does sound like fond childhood memories. But let's let's go to like when you were you said you were around 19 and you got into options. Were you so I sort of take it you were you were in school or going to school for finance? That's that's what attracted you. It seems um like I I'm I'm very curious about the sort of like the options ecosystem and some of the like you mentioned, unabated for options. Like you you were you were it sounded like a total sort of novice at the beginning. Yeah. Like did you what is that ecosystem like? Like, are there like did you did you get to the place where it's just like this is too competitive, I'm gonna go to sports? Or like how how far along or how serious did you ultimately get with some of those those training sites and and what you talked about, like in the options world?

SPEAKER_02 5:20

Well, I mean, it started just with like, you know, running up maybe like 500 bucks and then losing it, and then trying again, and then you know, just digging around for more information. Then I eventually stumbled at one of those sites. And it was cool because like a lot of that options analytics stuff, like a vol surface, for example, you can't really get that unless you have like a Bloomberg terminal and this guy's site. It's it's called predicting alpha. He like had all that stuff on there. Um, but even then that was still like to no avail because you know, every the whole competition has that kind of stuff. So it's like it's it's not like that's gonna get you an edge. And just kind of grinding through stuff like that and thinking like, oh, now this is gonna be the time I start making money, and then like you don't make money, you kind of like just through there gain a humility for the market, and that you really just gotta have if you're gonna be a taker and and have like nuanced information or try to process it better, uh, it's it's not gonna be with like public information, especially in anything that has liquidity.

SPEAKER_03 6:31

So the the unabated like comp was you you could you're still not winning using that, whereas like unabated you can win because you can bet into you know DraftKings and and whatnot. But like there wasn't an equivalent.

SPEAKER_02 6:52

I guess I would like equate it more to unabated in that like it was kind of the first thing for the public that you could really get like all those kinds of like options charts and IV rank and all that kind of stuff, like how unabated you can have uh all the different odds from all the different bookmakers, and they have some like uh you know, what is the point worth tools, things like that.

SPEAKER_03 7:18

Okay, makes sense. Okay. So like it had like that pricing pricing tools and information. Yeah, you know, that was our yeah, okay. Okay, that's cool. Um, so you're I guess what were you in school for?

SPEAKER_02 7:36

Finance.

SPEAKER_03 7:37

Finance, okay, okay. And then when you graduated, you went into a traditional finance role, like no, so I graduated during COVID, and uh my first job out of school, I mean you just kind of had to take anything.

SPEAKER_02 7:51

So my first job out of school, I worked as a fraud analyst at a bank, actually. Did that for like a couple, three years, got laid off. Uh, then my next job was uh just back office at one of the large agricultural commodity merchants, and eventually got laid off from that. And during these roles, I was just kind of like slowly top-down betting.

SPEAKER_03 8:19

Okay, so you were getting into it. So by the time you got got laid off from the but from the uh agriculture trading firm back office, were you like was that when you were like making a hundred K plus top downing, or was that after? And that was like full time at that point?

SPEAKER_02 8:37

Probably like my last year I was working there. That's about what I was making, betting.

SPEAKER_03 8:43

Got it. So then at that point, you had the choice of like, do I go look for another, like what we'll call like traditional role, or I just made you know 100k doing this. Like, do I just now do I just spend more time doing this and I think I'll make more if I can put the time in? Was that kind of the decision you came to?

SPEAKER_02 9:04

Yeah, I mean, I didn't at that time like totally say, like, fuck this, I'm out of corporate America, but uh I mean, I was still kind of passively looking for jobs, or if like a recruiter hit me up or whatever, I'd I'd answer the phone. But uh yeah, I was focusing most of my effort on just grinding out lines.

SPEAKER_01 9:24

So when you were you get out of you, you were doing option trading in school, you get out of school, and and we sort of jumped ahead to like, you know, out of corporate America doing this full time. Like how how did you how did that transition from options trading to sports spreading go? Was that like a very obvious jump to you? Given, you know, some of your lessons, like you, you talked about like respecting the market and whatnot, I think is the basis for a lot of the idea of top-down trading. Like, was that was that an easy jump to you? How did you get into sports gambling? I think there's probably also a segment of people who, you know, view like finance as like not gambling and and uh you know gambling as gambling. So like was that an aspect at all? Or just like walk me through how you got into the sports and and started making money there?

SPEAKER_02 10:12

Yeah, I mean, I kind of just stumbled upon sports betting just like any other kid in college, really. And then uh I just immediately right away I'm like, oh, this is exactly like kind of how options are priced. It's it's really just like the same thing. And then uh, you know, made a few punt bets here and there, just like anybody when they start, you know, betting recreationally. And then I don't know. As I was researching it, I mean one of the first videos I come across is like Alex Monahan stuff with odds jam. And then right there, just kind of clicked, like, you know, just get an odds screen and and run top down.

SPEAKER_03 10:54

What would you say to somebody like I think now we're kind of at this point where gambling's like now turning back into finance, at least, like, you know, pretending to. Like, what would you say to people who are in the sports betting space? Like, what were the similarities uh you saw, and did you feel like coming from that background gave you some kind of edge and or some kind of different view or edge in top down that someone who just started in sports wouldn't have had?

SPEAKER_02 11:25

Um, I mean, the first thing that was just obvious to me and the similarities between uh options markets and betting markets is that if you just look at like an alternate chain, right? Of like all the alternate spreads, that's the same thing as like an options trade. Uh, I mean, the minus 110 spread is gonna be the same thing as like the 50 delta options. And then the you know, the 25 delta calls might be like, you know, buying a few points up the chain. Uh, then, you know, if you were to do live markets, there would be time decay with that, right? So, like, if you know if a team didn't score anything or the score was just like flat, you know, the two points out would have to be priced at a higher payout as like that time of the of the game decays. Um, so there was just like a lot of corollaries between how options are priced with with betting markets.

SPEAKER_03 12:18

Yeah, I think like that is how I like that to me is how I think a lot of like options people view it. And did you come in being like, oh, this is where I'm gonna like poke around for edge, like maybe the time decay is wrong? Or yeah, I mean, keep going.

SPEAKER_02 12:37

Yeah, one of the one of the first things I tried was to kind of like price in the the volatility of a betting market. So like if you look at uh like a baseball game, for example, a game with a total of 12 is gonna be more volatile than a game with a total of six. So that means like the minus one and a half, the minus two and a half, all those have to be priced at like lower payouts if the total's 12 versus if it's six. So I kind of just tried to tinker with some models on stuff like that and back tested it and wasn't able to find any edge, but that was like something I kind of dove into.

SPEAKER_01 13:18

So one of the things I want to ask, so as friends, you know, I'm friends with some finance people. Um, some are more like mathematical than others. Um was is that like a bent to you? Because like I'm hearing like, you know, you were you were you were like very into all of this when you were like a relatively young age in college. Like I think the vast majority of people who are betting on sports and or options are like have no idea about any of this. Maybe that's wrong, but like that would be my assumption is they're not thinking about like any of this, these actual problems, like to even if like options are hyper competitive and you couldn't generate an edge there, you were at least like trying to get better and whatnot. So do you have like that sort of like mathematical bent? Was it is that like you know a strong suit of yours? And and and I knew when we were talking before the show, you mentioned like I never originated something, and then I think you put in parentheses like successfully or something. So I do want to hear it's fun. I wanted to ask you about some of like the unsuccessful. It sounds like maybe this was like a version of that, but um like I'm just curious, like on that background, because I it seemed it strikes me as like a not the normal path for the people I know who were in finance.

SPEAKER_02 14:30

Yeah. I mean, another thing I tried to do was like a bunch of stuff where like if the more liquid, full-time money line market moves by like this much, what's the relationship with like the first half, the first quarter, stuff like that? I tried to like price all that out and and just like found nothing in the back testing. And I was doing this also before, and like I don't I don't have any like programming background, and I was doing this before like Claude and Chat were like really good at you know basically just doing anything you wanted to. So I would have to like get these developers on upwork for like$10,$15 from like whatever country to build.

SPEAKER_03 15:15

It was probably huge alpha, but they just were like, you know what, I'm gonna take this. It's not worth$15 an hour. I'm actually gonna just bet this. They probably found it.

SPEAKER_02 15:24

No, no, I didn't. I didn't all I would do is have them like scrape the odds for me.

SPEAKER_03 15:28

Okay. And I was gonna do like an analysis.

SPEAKER_02 15:32

But uh, you know, then looking back at it, I had to scrape it from like odds portal, and it was probably like all fucked up. Like there's probably like from the naked eye, bird's eye for you, like you could probably look at it and be like, yeah, that looks good, but there are probably like enough inconsistencies in there that there's you you probably couldn't like trust a back test on any of that, anyways. But yeah, those those were just kind of some dead end projects that I did.

SPEAKER_03 15:58

We all have them.

SPEAKER_01 16:02

Yeah, so let's let's let's we'll we'll go to go to like you being full time. I know you had mentioned that and got into that, but um yeah, so so maybe like before you you were betting um while at your job successfully. It sounds like your last year you you were you were making solid money that you know at that point um from betting. Like, was this all just you, your own accounts? Like, have you had you run into limits? Like, did you did you have like a you know, because there's sort of like a first layer understanding of sports betting, I I would say of like broadly. Like if you watch an Alex Monaghan video, I think you most people can broadly understand like how to win some money. Yeah, I think the the like going full time, like you said, and I know you said you were sort of like half in, half out, still considering, but like, did you where where were you on like the full sort of like knowledge curve when you you were like, okay, I can do this full time. This is what I'm gonna do. I'm gonna lean into this.

SPEAKER_02 16:56

Yeah. So I actually didn't figure out uh like spanky's very valuable out and information videos until like after it got announced that they were gonna do like the 90%. You can only write off 90%, which kind of like killed the top-down future stuff for me. Um, but I still understood you were gonna get limited and you had to find other accounts. But I never really like had to go past like just a few close friends and some family members and stuff like that. And like my bankroll was just not large enough at the time to where I was like even betting a big enough pop to like I wasn't even like close to like a limit bet on some of the stuff. I got limited really heavily on like all the player props, but I mean on size and stuff like that. I mean, you could still get down like 500 to 1000 bucks, which is like an well, that was enough for my appetite. And they they didn't seem especially like on live, I never really got limited down to more to like 400, 500 bucks. So I was still able to like make a decent amount of money.

SPEAKER_03 18:01

Yeah, it does feel it feels like there was like that that sweet spot, like live gold rush, where like books weren't limiting. I I feel like I don't know how it is now in sportsbooks and live, but it did feel like people were just like making a ton of money live and somehow not getting limited.

SPEAKER_02 18:19

At least Yeah, and you get a lot more opportunities throughout the game, right?

SPEAKER_03 18:24

I guess it's like harder to tell like it's harder to tell if you got real CLV, right? Because like you can make a bet and then something happens, and then you can't compare the two states of like the state where you made the bet and the state 10 seconds later. But I guess your PL after a certain time like just tells a story.

SPEAKER_01 18:46

Right. Yeah, I mean I think it's like it's like any, it's like you, you know, we'll get to the prediction market stuff, but it's it's the same thing. I think live benefited a lot from the same idea of like SGPs and whatnot. It's like because now if you're if you're taking bets like live during an event on the prediction markets, it's usually either like very good or very bad. Yeah. One of the two. Yeah, not much in between. Um, and so you know, I think I think the same problems like we talk about about some of the challenges with live is you know, sports books, you know, like we're inventing sports books from first principles here.

SPEAKER_03 19:21

It's challenging to determine whether we're helping the sports folks learn how to do their job retroactively. We're finally catching up. No, I was gonna say, but yeah, I was gonna say it's a good point, but I SP that you know, live and SGPs are the places where you can book something that's really bad or really good. And then like the pregame stuff, it's it's smaller edges, but like your risk of getting totally killed is not that high. Like it can't be that good, can't be that bad. Uh I like that. I didn't thought of that.

SPEAKER_01 19:54

So were you doing it? Sounds like was it predominantly like when you were doing top down? Like, let's walk, let's get into some of like the details of that. Um, like it was primarily live you were doing, and were you using like software at that time, um, tools? Like, how how were you how were you actually generating or like finding the opportunities?

SPEAKER_02 20:14

Yeah, I was using a site, I would just buy like the full subscription to a site called Pick Dots. And that would just show like whatever something's like an ARB to Penny, Chris, Bookmaker, or Circa, whatever. And then you just take it there.

SPEAKER_01 20:32

And was it mostly live at that point, or was it a good mix?

SPEAKER_02 20:35

Yeah, yeah, because you you can just get like so much more down throughout the game. There were so many more opportunities, and then it was also sometimes good to hedge your risk because you might get like the other team is now an advantage, and then you can bet there and hedge out some of your volatility.

SPEAKER_03 20:56

Well, let's talk about I mean, I guess let's talk about prediction markets, or at least let's let's start going that way, because we have uh you know, we have the jump from live at sportsbooks, which is pretty good, to if you're being a live taker at prediction markets, it can be really, really good. Um was that why you started moving that way? Like you just saw, or what you know, the 90% tax cap, or was it Yeah?

SPEAKER_02 21:26

It was honestly like the tax cap on why I started looking that direction. Yeah.

SPEAKER_03 21:32

And when you first got on to Call She, like you get on there. I think one thing that people, especially people who like aren't doing any originating, get scared with the exchanges is they're like, oh well, they're efficient. They're like the options market or whatever. Like it's I can't win there unless I like you know have an opinion or I'm like a quant firm. But you know, I think one thing we're trying to do on the podcast is kind of show. Alternatives to that. So like when you logged in and started looking at culture, like what do you go to look at? And how did you feel like, oh, there's some edge, there's some edge here.

SPEAKER_02 22:10

Well, culture actually wasn't the first one I looked at at all. I was looking at Polymarket International for the longest time. And uh that was probably like that's probably like the hardest one to trade on because I don't know, I haven't been there for a while, but at that time there were like no fees, there's no KYC, like total Wild West, no nothing. So like you could just get picked off really easily. Um there are a lot of illiquid markets that you can manipulate. There are a lot of stuff you can do with like people's copied bots. Um I mean there are there were some like mega whales on poly market that you know probably just had a ton of crypto money and it was really easy to transfer it over to there. You know, anyone in the world can bet on there. There's like no regulation. And uh there was this guy who would just pound overnight markets, it would move the whole screen. Like he'd get down like 500k to a million dollars on like overnight markets, and he had a Twitter attached, and he was like in India and everything, and I was like looking at him to try to like learn how he bets if he's like sharp or not, because he was on like a hundred and fifty game win streak. It was just like doing nothing but making millions of dollars. So I was like, shit, do I like tail this guy or do I book this guy? And then it turned out like he was he was better at the book, and there were a lot of people like that. And what you can do and what yeah, what you could do is like how these guys would bet, they were obviously like takers, but they would take like four levels into the order book, like at horrible prices, and they would just like repeatedly like sweep it like in intervals of like five, ten minutes. So what you could do is like if they made one big bet, you know, just post the market and then hope they hit it again, and then you can get filled on like a spread at like plus one fifteen, something like that.

SPEAKER_03 24:01

So in that circumstance, you'd be like, okay, I'm gonna post like three levels below top of a buck.

SPEAKER_02 24:06

And just like just hoping that guy comes and fills it, and then if it's like it doesn't happen in like 10-15 minutes, then then get rid of it.

SPEAKER_03 24:15

See, I think that's something like while it's probably obvious to you that for you know people coming this direction from sports betting, it's not as obvious to them that that's actually like optimal there. If you have if you realize like there's this player in the market that does XYZ, like I should not be like in that situation, you wouldn't want to post top book, but you can post like third level and have no opinion and and just like crush, right?

SPEAKER_02 24:45

That's like I feel like I was thinking about just getting up on Twitter and booking it myself, but like that would be I was a big don't condone that.

SPEAKER_01 24:56

I I feel like we've taken a large jump. We went from like you know, odds jam to to like this this level of sophistication on on polymarket. Like was that truly like what you jumped in on? Because I feel like there's a decent amount, like were you were you sort of making right away on polymarket, or or yeah because I feel like the more but a lot of that stuff can be adverse too because like people will beard in with those guys.

SPEAKER_02 25:23

So like what would happen? You would see this, like you'd catch on to the trend, and people would catch on to the trend maybe like a week later, and then you'd see when this guy like made his first bet, then there'd be like a ton of liquidity coming in for him to like make his second bet. And there's almost like if you wanted to, you you know, and you could like beard for somebody.

SPEAKER_01 25:44

Yeah, you would beard. I'm interested because you said like I wanted to talk about this a little bit more, and I'm glad we got into it because you you had said when we were talking, you know, pre-show, like about polymarket was too adverse, and I wanted to hear your perspective on that, why that was and some of your experiences. But yeah, I mean, I think like from my perspective, that's one of the clear it's like a second-order effect that I don't think a like an outsider would really understand. Is that in theory, you know, like making making everything public, basically, is would make it more transparent. But in practice, I think it just introduces all these weird games and incentives that it's is like the opposite of that. Um and so yeah, I'm curious. Like, did you have that? It sounds like you had one experience, like that was a positive one with the you know, the whale in India or whatever, who was just clearing out multiple um ticks in the order book. Like, can you talk about some of your your experiences like or what uh drove you off the site that it was like too um too adverse?

SPEAKER_02 26:50

Well, after that, I kind of just tried to you know get an unabated API, you know, just the web socket and just postmark it's on there. And I don't know if I had some issues with the feed or whatever, if I was not fast enough, but like I I was just closing horrible, like every time. And uh I don't know, I just did not have that experience at all on call sheet. And I think a lot of that has to do with call sheet has the fees, and uh, you know, they got a lot of just soft flow from the Robin Hood accounts. And uh I just I don't know what exactly the mechanism was that made it adverse. I probably just had poor code or something like that, but uh yeah, I just I did not do well market trying to market make mains on polymarket.

SPEAKER_03 27:44

Are you clodding at this point or you know chatting?

SPEAKER_02 27:48

Yeah, 100%.

SPEAKER_03 27:49

Okay, got it. So you're like, okay, I'm gonna get unabated API. And and then basically, like, I I actually kind of want to double back to Polly in a second, but you took the same code with obviously the modifications that you need to make to integrate into Call She's API, and with the same strategy, we're making money on Call She while you weren't making money on Poly International.

SPEAKER_02 28:16

Yeah, well, I was gonna try to go right from there to the poly mains, and then I actually like heard people talking about the RFQs, and I actually heard Louie on your pod come on and talk about RFQs, and damn it. I kind of just stopped dead in my tracks and was like, let's investigate this, and then decided that that was gonna be a much better way of doing this.

SPEAKER_03 28:41

Okay, so you weren't when you first started on Call She, like you were not you weren't market making mains. Or you started maybe and then.

SPEAKER_02 28:51

Yeah, sort of like building it out, and then like as I was doing that, that's like when I I heard the whole RFQ stuff, and I decided to pivot and look into that.

SPEAKER_03 29:02

For when you were on poly international, were you were you building out like a lot of trading strategies that were similar to stuff that you had tried like towards the tail end of options where like, yeah, maybe you weren't winning, but you're clearly like sophisticated enough where you know you were you understood enough where maybe you know you could have been winning if you were put at like uh you know a citadel or whatever and like making whatnot.

SPEAKER_02 29:38

Uh no, I never really tried anything like super quant like that. I mean, I think I'm like just as good, like good enough at math to like understand what I want, but in this game it's like all about really intricate details, and I'm not good enough at it for that. So I didn't want to I didn't want to try going that route.

SPEAKER_01 30:02

So what you said you were listening to our our podcast with Louie, like what what in that podcast, um like because you know, every time someone talks about RFQs, at least for me, there's a there's a portion of my brain that's like, wow, I need to drop everything and do this right this second. And then there's a portion of my brain that's like, this is gonna cause me to lose everything and I'm gonna be homeless if I try and do this. So what like what what attracted you or or brought you to want to try try that after hearing that episode?

SPEAKER_02 30:35

Yeah, it was just really my bankroll size at the time. Um, I mean, everything on the main markets, it was like a penny wide. So, you know, you'd really have to do some volume to make like real PL. And I didn't have enough money at the time to like do that much volume or like take a bet that large at like that small of a margin. So I thought it made more sense to do something more appropriate for my bankroll, which I thought would be RFQs. You know, you can take smaller bets if you want to, as long as you're in front of the market. And uh they definitely had higher margins. So I just thought that made more sense.

SPEAKER_03 31:16

And you were like, well, if Louie can do it, you know.

SPEAKER_02 31:20

Well no, you I mean he sounded so sharp in that if you had Louis sounded way smarter than me.

SPEAKER_03 31:25

I don't know if I'm gonna be able to do that. That was just that was that was jerk. So okay, so you but it it's very interesting because like I would have thought that there would be some like live taking portion of you. Like I I assume that from hearing your background at the first you know, the first bit of this coming on to Call She or Polly, there'd be some like live taking because you have no delay and you've been you know prior on the sports books doing a lot of live taking into honestly like what is probably not is probably like a similarly tough environment as doing it on call she like I can tell you like live making is super hard. So somebody's making money, it must be the taker. So like why why not do you know kind of just continue doing that that taking strategy that you were doing on sportsbooks?

SPEAKER_02 32:24

Because I think I actually I thought like, you know, if College Live has no delay, if somebody's putting the market up there, that must be like really good. Like the you know, if someone has the balls to put like 10k out there like that with no delay. I mean, maybe maybe I'm wrong, and maybe that stuff like easy pick-ins, I don't know, but I just kind of assumed like that would that was good and never tried going after it. I I guess I had too much respect for that market.

SPEAKER_03 32:54

Yeah, that's fair enough. Like I was shocked the first time I saw like a live in-play NFL market, how much was up on Call She. I was like, that's insanity. Like I cannot believe that. But I mean, yeah, it's also different. Like you're the price could be very sharp, but the vulnerability in call she is the delay. So the way to win on call she is not necessarily like the same way that you'd win live betting on sports books where you're getting like ARBs and whatnot, and you identify one book as sharp. Like the way to win on call she is obviously just to court side, um, which is which is different. That that requires a whole different kind of setup. So that that does make sense.

SPEAKER_01 33:42

Yeah, I mean, I think it's like just a broader point, and I I'm curious if you've if you've dabbled in any non-sports, because we will we will talk about RFQs and your experiences there quite a bit, I imagine, but maybe just like broadly prediction markets and and some of the non-sports stuff. Like, I feel like we're gonna look back and be amazed at how tight and how much liquidity was on a lot of these markets. Like, because if you go outside of you know, sports, like I think I've said this before on the podcast, like there is no way, like the the efficient place for you know, like a mentioned market to be trading than an you know an EPL side has ever traded. Like, there's just no way that should that that should be the case. Um and so I think one of you know the things that that at least for me I've had to learn, you know, to your point is that like it's like in sports betting a ton of size, like historically a ton of size and whatnot has been like a deterrent. I I just feel like we're in this like frothy period with these prediction markets where there's a ton of where it's not warranted. And I think it's something Henry's said um at Novig, is like it's not one person who's very confident, it's a bunch of people who've put up like small orders and it's just trying to collect some rec fluff, which turns into a very big order, right? So um, yeah, I was I was curious on that question. I'm glad John asked that question because I I see a lot of people who I'm my understanding of what their strategy is like live taking appear to be doing very um very well on Calci still.

SPEAKER_03 35:21

So yeah, and like I've mentioned many times, I have a I have a collection of data on some life takers I've interacted with, and they're quite profitable. I just assume they're crushing it, or maybe I just I just suck. But uh okay, so you so you you zone in so you narrow in on RFQs. So when you're when you hear the Louie episode and you say like I think this is a good was Louis before Exe or no? I actually don't remember.

SPEAKER_01 35:56

It was before, I think.

SPEAKER_03 35:57

Okay, so it was Louie then. Yeah, okay, got it. Um so what do you do to start diving in?

SPEAKER_02 36:07

Uh really just figure out how you're gonna get your pricing feed. And uh then the next hardest thing is actually like the hardest thing that I've like had to build, it's gonna sound like really stupid, was just making sure the matching is really robust. Like whatever you're streaming your odds from and what it's called in call sheet, like making sure like that never fucks up because that that's gonna like cause so many. I I was laughing like at Eggsy's episode when he said he flipped the spread. That's exactly what happened to me. I was laughing at SP when he like had the the Azure Thompson and Amen Thompson debacle. Like, I I literally did that too. And uh and you know, you hear a lot of other people. I think one guy came on to uh uh Chris and Henry's pot, and he said something like that as well. And with poly market, like the slugs are even worse. But uh yeah, that was like the hardest thing I had the engineer. And uh I mean the way I looked at it was you know, I'm just gonna put X amount of money in the account. I'm gonna look at it if I lose that as cost of doing business. I'm gonna look at it as if the market wants to pick that off. You know, that's my consulting fee. You know, I'd rather let the market find my leaks instead of like hire some dev to try to go through my code and he's probably gonna miss stuff anyways. Um, and then just kind of put it up and start blasting and uh, you know, engineer it so it logs as many things as it as you can possibly get. Like even if you think it's overkill and you're not gonna need it, just like log every single thing that your quota interacts with. So then, you know, after a month or so when you get a whole bunch of data, you know, you can fine-tune everything.

SPEAKER_03 38:02

Okay. This is is so key. Like we do we do RFQs too, and like the logging and the post trade and all of that are so important. So I'm I'm glad you brought that up. And like you only yeah, like I feel like almost all the alpha is in like because the the RFQ system uh is like very black boxy if you just like hook up to it and run it. Like you don't actually you have to create the stuff that you see and that you all know.

SPEAKER_02 38:36

You essentially gotta make like a whole API that would be like enterprise grade that you know you could sell for like historical data. That's like the way I look at it.

SPEAKER_03 38:46

Right, right. And that's like almost it almost feels like that's the edge, right? Like, because there's so much that can go, you're obviously playing a lot of defense in RFQs, right? But uh, you know, everybody can kind of connect to you know whatever pricing feed, not you know, not everybody, but you know, I think a lot of people are using the same pricing or similar pricing, right? But I think like where and we'll get into this later, and there's some good questions on this, but like the game in RFQs does exactly what you said that resonated so much with me. So thank you for for bringing that up.

SPEAKER_01 39:24

Can you can you give you know uh someone like like me who's only dabbled in the RFQs and and listeners like an idea? I don't want you to share anything you don't want to share or whatever, but like an idea of some of the things you're tracking or a specific example where in in retrospect you're glad you you track that or or just how it's helped you. Any of those questions are you able to respond to?

SPEAKER_02 39:47

Yeah, just in general, like you know, I saw some questions on people now like complaining about like they don't get filled anymore and stuff ever since like two weeks ago when when Kalski just like like ramped up how many API requests everyone gets or whatever. And I mean that's that's like where the logging comes in hand, is because like you can analyze like the whole pricing curve and be like, okay, this is where this is where I probably shouldn't even be like dropping my prices anymore, and and I could arguably not even compete here. This is where like I could drop my prices more and I can win some fills. Uh this end of the curve, this is like where you know my field percentage versus what I quote is pretty high. Uh just stuff like that. Then like, you know, who who's a sharp taker, you know, get rid of them.

SPEAKER_00 40:34

Yeah, get the fuck out of here. I'll no, we can't.

SPEAKER_01 40:39

We we can we can't like I tried. Yeah, I tried to. Just pay GP make sure that's cut and uh no so is this is it is it uh maybe I didn't understand off the bat. Are you so you're logging not only like your trades, but are you you're just broadly logging like all as many like RFQ trades as you can? Is that fair?

SPEAKER_02 41:00

Yeah, like everything, everything that my quota interacts with.

SPEAKER_01 41:05

Okay, and sort of you quoted what other people quoted or what was confirmed and trying to you know derive value from that sort of exercise.

SPEAKER_02 41:15

Yeah, or just really, really anything at all that my quota interacts with, even if it's stuff that like it filters out, I want filtered out, I I log what got filtered out. Don't even know if I'll need it or whatever, but you know, just anything and everything.

SPEAKER_01 41:33

I mean, total sense to me because like the order book is like extremely transparent. It might be confusing to people who are not familiar with it, but it's very transparent, like what's going on. RFQ is like the total opposite. So the need for this to sort of build that transparency makes makes total sense to me. GP, did you have something?

SPEAKER_03 41:53

Yeah, I was gonna well I I think like and I want to talk, I want to talk to Troy about the uh Matt Calish like rant a little bit, but it when it's like, oh, like everybody can see like what who you are. It's like A, that's only on RF Keys, which is like you know, kind of how OTC or like anything like over the phone and an RFQ market would work more traditionally, and B, even within that, it's still really fucking hard to like get all that information. So it's not like that's just popping up to anybody, um that it's publicly available, obviously. Uh but one thing I wanted to tack on to that, Troy, and I wanted to hear if you had this this uh experience, but it's like, yeah, you're trying to figure out like, oh, why did I not get filled here? And sometimes you're like, oh, I'm not quoting like this thing because I did this thing wrong. And it's not that I'm like everything's wrong and I'm not getting filled, it's this one specific issue where if I just fix that, then I'll start actually responding to like this type of quote or whatever. And that that's where it just becomes like because I think like the big issue is when people start, they're like, oh, I'm not getting you know any fills, so I gotta make my my prices better. But it could be that you have a lot of issues and you're not quoting certain things that are popular legs, yeah, and and they'll it'll all drop silently.

SPEAKER_02 43:24

Exactly. You're not logging it and you have like no way of figuring it out. I mean, one for instance was uh in Colstrees API docs for the RFTs, you can go up to like it says you can go up to like four decimal places, but like if you do all four and that fourth number is anything but a zero, it's gonna like silently drop. And I didn't learn that like on accident. I learned that by accident, like a month later, and then I was like, Wow, now now that I figured that out, I'm doing like four times as much volume, like just for that little thing.

SPEAKER_03 44:00

Right. Like how many times have you been like, like, man, I'm not, yeah, something's, I'm not getting filled? Or like, man, my volume's like kind of low. Or not even that. You're just like, wow, I'm doing a lot of volume. And then you figure something out, and you're like, oh shit, like I'm doing so much more volume. But I think that's the thing. It's like people turn the price knob, but you might just be like improving your price so much that you're getting bad fills, and the only markets that your quota is quoting, and you're not, you know, and you're you're basically missing all these other ones.

SPEAKER_02 44:31

Yeah. You never quite feel good. No. You only have like a there's like a medium amount of of like volume that that you feel comfortable with, and then anything less or anything more makes you nervous.

SPEAKER_03 44:45

Yeah. What are uh I yeah, that yeah, exactly. I mean when you when you start building, were you building from a place of like obviously you're like, hey, I'm gonna try this out. So you know, we're trying to get better, and that's that's what how I think that's what SP and I always preach on this show, is like kind of exactly to you to your example, it's it's a it's a good example of this of like plugging in and kind of figuring it out on the way. But are you like, how did you how did you go through the process of kind of growing? Because obviously you've you've done pretty well, um, and I'm sure you've started to loosen up the uh the quoting as you've gone on and trying to do a little bit more here or there. Was it like you're gonna start with certain markets and just add markets or start with certain like per leg risks, you know? Like how did you kind of like build out uh you responsibly like build out your RFQ quoting?

SPEAKER_02 45:43

Yeah, I mean my my like risk and per leg risk has always kind of more or less been the same in terms of like relative to my bankroll. Um but all I never like really trickled in more markets unless you know I started doing this in like February, and then you know, when MLB starts up, then you know you you move into that market and get that up and running. But no, I kind of just like fired it all right away. Just logged it and saw what happened.

SPEAKER_03 46:17

I'm I'm over here fishing for like, yeah, like you know, I really what I you know, I was really responsible, you know, I really followed this process. You're like, nah, dude, I just fucking fired it in there. Don't be such a bitch.

SPEAKER_02 46:28

Yeah, I mean you just when you start off, you know, just like I said earlier, look at it as a cost of doing business, put an put an amount of money in your account and you're willing to lose, quote, like an honest amount, so like you could get a realistic picture of like what the market actually looks like. And yeah, just go from there, take all the information you can and then improve on it.

SPEAKER_03 46:50

When you say quote an honest amount to see the market, do you want to I think I know you're I I think I know what you're getting at, but can you expand on that?

SPEAKER_02 46:59

Yeah, well, I mean, if you're you're offering like 10 grand, the probability of that being adverse is like a lot higher than if you're offering 20 bucks. So you kind of want to like simulate, you know, what you're actually gonna be doing in practice and not like okay, well, I have I put like five grand in this account to like do a little trial run or whatever, and I'm just gonna quote people like on the little five dollar stuff. Like that might not be good enough to get like an accurate depiction of you know what it's gonna look like when you start offering people a couple grand.

SPEAKER_03 47:36

Absolutely, yeah, yeah, for sure.

SPEAKER_01 47:40

Has that part been something you've you've dialed and learned um, you know, while working through this is like optimal sizing and like size constraints on like what you're willing to offer, depending on the size. I know that was like, you know, maybe we could get into a little bit about uh calishes, you know. I think he's still going tweeting through it. Um, but I think that's what set it all up.

SPEAKER_03 48:04

Stamina, man, dude. The founders of these big companies are built different.

SPEAKER_01 48:08

I think it was an RFQ quote. I think uh it wasn't clear to me of what was or not. No, it was a golf. Was it purely golf? It wasn't it looked like a combo to me, but I couldn't it was his Brooks Kevco bet.

SPEAKER_03 48:21

And then, but he was also pissed about like then he went into the RFQ, basically, like the RFQ system where you can see user IDs in the RFQ system.

SPEAKER_01 48:31

Okay, yeah, it was there was a lot of tweets, so I couldn't keep up with them all. Um, but my my original question was like, you know, he was tweeting about getting a different price depending on size and the slippage or whatever, if it wasn't uh RFQ. Even if it were if you if it was RFQ, I think it's pretty clear, you know, like for a user, if you plug in a parlay for$20, you're gonna get a better price than if you plug in a part that same exact parlay for a thousand dollars, um, usually. Um, so like have you is that something you've sort of like worked through and and thought through like different sports, different situations, numbers of numbers of legs, like et cetera, like the optimal sizing you should be taking and and yeah, I'm I'm eventually gonna like fine-tune it for that.

SPEAKER_02 49:12

But like, you know, if you're gonna get like super granular, like, you know, how much lower can I go if I'm gonna court a parlay that's like seven legs versus four legs that has like two player props and two legs that are live versus like you know, one that's all player props pre or something like that, you know, it's to get to that level of granularity on like how precise you're gonna be with where you drop your prices. I mean, I'm I'm just collecting more and more data and trying to, you know, eventually get to that level where I can be that granular and really like stick my head out in front of the market and stuff where like I know I can still make money. But uh yeah, I'm not I'm not quite at that point yet, and I'm still kind of just generally throwing like the same margin on everything.

SPEAKER_03 50:01

Uh it's it's cool that it's clear like that your process is driven by post-trade data collection, and like you have this pipeline that is your RFQ process. Like, I think a lot of people are like, oh yeah, like I'm just gonna quote, you know, Vanduel and then you know make money, but it's it's it's not there's like this whole other half, which is more than half to it, which involves like gathering and analyzing and seeing the market and like how that I think like the data you're collecting, even if you're you're not using it, it's that's like the hardest thing to do. It's like, yeah, I want to make something to collect this thing that might be important or might not, but you know, I want maybe want to have it because if you don't, like it's gone. So now like looking back, you're gonna have this ability to get a great visual on like the entire RFQ market and all of the optimal strat, you know, all of the ways you can optimize, which aren't obvious at first. Like Yeah.

SPEAKER_02 51:09

I mean I try to make it good enough that like I could sell it if I wanted to.

SPEAKER_03 51:14

There you go. Well, uh, you know, you know my you know where to find me.

SPEAKER_01 51:22

What's the reason for that? Because like every code I make, I make to just bare bones work. If I die, it's never gonna be able to. If if if I ever, you know, it's not gonna be usable by anyone else. It's like I have to know each what what is the purpose? I mean, maybe it's easier than ever to do some of that stuff just with you know the AI stuff, but what is there is there a reason beyond that?

SPEAKER_02 51:45

Um I mean, I don't know. I've I've thought about like potential exits in this, like if it gets oversaturated, you know, like I just sell the bot, but then you know, if everybody has the bot, you know, if everybody's super, then nobody's super kind of thing. And you know, or if I want to sell like the historical database that I've collected. But I mean, mainly it's just for now for my usage, but I've just kept that in mind. And if you're gonna build something that collects all that, I mean with Claude, it's like not too many more steps to like make it in a very organized fashion. And and at least what I'm projecting that maybe be enterprise grade. I don't even know what enterprise grade is supposed to look like, but I think it's good enough to sell. I don't know.

SPEAKER_01 52:35

No, that makes sense. And I I yeah, I will I I think it's a really interesting discussion because like I think we've even gotten a question or so in the past week on like what is the when when everybody has the same odds or everybody's just plugged into the odds feeds, like what is the edge? And I think this is the edge of like like like GP was saying, like competing in the right places. Because you can extend this to like just top down and betting in general. Like it's not like it's not like you know people have a most people have a general idea of what the fare reasonably is for most games, right? But the the people who are gonna make money are the people who can like navigate the order book well and get the get the action from the people they want well at the right time well. So like RFQs are really no different. I think that people think of them as different because the prices are like more opaque and you can't just you know scrape them in as easily, right? You need like a tool or software or you know, more creative solution. But ultimately, like the prices are not the secret sauce. The price, if if everybody can get the prices, the prices are not the secret sauce. Um, so you know, I think just with with how easy it is to get the prices, you know, that's that's not gonna be the the competitive spot. Um, I am curious like what you've noticed in the RFQ landscape. Um, even since like it sounds like you started in February. So for a listener, that might not seem like a long time, but just from my impression of dabbling or the past couple months and talking with people and just playing with it, like it seems like it's gotten way more competitive. Is that the experience you you've gotten?

SPEAKER_02 54:16

Yeah, I mean, ever since like two weeks ago or whatever, when uh they gave everybody uh way more requests per second. Yeah, it's it's gotten a lot more competitive, and I've definitely had to drop my curve.

SPEAKER_03 54:32

When when you're yeah, I I I do you want to expand on the requests per second, like why that's made it more difficult for you know those of us who are quoting RFQs or made it more competitive, I guess.

SPEAKER_02 54:51

Yeah, I mean if I think I think like the uh the standard was like you can respond the 10 a second. And uh basically they were just people with APIs on there, just like spam probing it. So a lot of people's bots were just responding to a lot of junk. Yep. So if you can like respond, I mean I I personally think that's a skill issue, and you should know how to like filter out the junk, and that's like something I'm not gonna also think that, Troy. I also think that I'm not gonna like say how to do it because there's some like really easy things if you just think about it for a second on how to filter out like a lot of junk, and I think 10 requests a second is is plenty, like if you know what you're doing. So I think now you're just seeing a lot of people's like poor filtering, like now getting some real bets.

unknown 55:45

God damn.

SPEAKER_01 55:46

Okay, man. Let me let me play. Can I ask a dumb question? Like, why why what benefit like why doesn't Calci just get rid of these people who are spam spamming the RFQ? Like it seems like those people serve no purpose at all.

SPEAKER_02 56:01

No, it's parasitic of anything. I I think they should be completely gone.

SPEAKER_01 56:05

Because I I hear what you guys are saying is like, and you're both probably speaking of your own self-interest, of like, I can filter out the right ones and get so I can like objectively, it just seems like those people are hurting the experience for everyone. Because I think in general, you if you're thinking of the you know the the average customer, you want more competition on the quoting, right? You don't want these finite, like you can only quote 10 or whatever per second, and then and then the prices are suffer because of it, right? I know I know selfishly that may be you know what the quoters want, but it feels like those people should just it feels like on I assume those people are going through the API and just mass requesting. Is that yes, what's sort of happening?

SPEAKER_02 56:49

Yeah, but you can you can get rid of them.

SPEAKER_01 56:53

So talk to me a little bit.

SPEAKER_02 56:54

I know you don't want to get callshire if you're uh or if you're you can just not quote them. Yeah, you can put it. Oh yeah, yeah, yeah, yeah, yeah. Okay.

SPEAKER_03 57:01

But if you're called, I think like also at SP to SP's point of like getting rid of them, if you're callishy, I think they're they have started to take some steps against those people. Like it's obviously they should.

SPEAKER_02 57:14

I mean, it's gonna it's not good for the market.

SPEAKER_03 57:17

Right. Right. I mean, I I think we like nobody's really gonna like go to bat for the person's right to like send in 200,000 RFQs and no, and I don't even know, like I don't even know who's like the end boss who's like making all the money doing this.

SPEAKER_02 57:32

And because I look at like my block list and it's just like growing and growing and growing. And I was I don't know how these guys get like new accounts or whatever all the time, just to like you know, hammer a few quick bets that are mistakes and then just be blocked forever, and then you gotta get a new one.

SPEAKER_03 57:47

I don't know how they keep like I don't know, like years of practice, years of practice in sports.

SPEAKER_02 57:53

I don't know how sustainable that is, though. Like I feel like it's not worth doing. I don't know.

SPEAKER_01 57:59

Yeah, I wanted to ask maybe a couple questions on that, whatever you can share or want to say around this. But like it sounds like that's an active process of yours of using the requester IDs and and using that to your your benefit. Is that that's a combination of it sounds like people who are just spamming the feed, but also people who you just frankly don't want to take bets from?

SPEAKER_02 58:24

Yeah, but like all of them. I've never had I've never had a taker like an of all this data collect. I've never had someone that I'm like, oh wow, like he's just fundamentally like exploiting that SGP correlation there. Like, no, it's always something to do with like like court siding or latency or whatever, just spamming it. It's it's like fixed out like a sore thumb. It's it's never anything like fundamental that like I could take their bet and then go make money off of it like being a taker the other way. Like it's always just like some parasitic stuff.

SPEAKER_01 58:59

Yeah, it's interesting. I mean, I think right now the the number of combo, like the just what's available in the combo product on on Calci is way more limited than something like on DraftKings or something, where there's like there's probably far more actual angles you could have, like sort of originated angles, but it makes sense that the vast majority are are sort of exploits, court side, etc. on that you yeah, you're seeing right now.

SPEAKER_03 59:29

Like I always think like I'm gonna be able to figure out this great angle, but sometimes, you know, if people like do it smartly and I don't know the sport, I might not actually even know I'm getting, you know, I'm losing like to a fundamental angle.

SPEAKER_02 59:48

But it's so obvious when somebody's like courtsiding, you know, and like exact, you know, there's yeah, and then you could like after you know, you tracked a bet, and then you can go see like you know, from NBA.com, you could scrape it all and then see like the wall clock of like when that play happened, and like, oh yeah, that was courtsighted.

SPEAKER_03 1:00:07

Right, right, right. Um I mean we there's a lot of good RFQ questions, but we have some other we want to talk about kind of like your future plans. But SP, did you have anything more like on the this first block of RFQs?

SPEAKER_01 1:00:26

Like obviously a lot of the questions are about RFQs, but yeah, maybe maybe I know we touched on it a little bit, but like you you one of your questions was the genesis for our show last week of like managing risk. And I think you you mentioned that sort of like the per leg and uh maybe total exposure, like those have remained sort of constant. And we exchanged some DMs about it too. But like, do you have anything to add to that conversation about how you've you've learned to manage risk? I mean, obviously it's like a very interconnected web when you're doing RFQs and you don't have like a clear view of like this is my individual risk on this bet. So so how do you think about that and and how have you managed that?

SPEAKER_02 1:01:07

Yeah, I mean, the episode last week, I mean, that just gave me confirmation bias that I guess I'm doing like a good enough job and it doesn't need to be overkill. Um, but the way I look at it is I say, like, okay, this is like the max drawdown I'm willing to take in a day. I mean, for me, that's like 25%. About quarter Kelly should like get you around there. And then um I do from that max drawdown, I just divide it by three, and then that's like the the max I'm willing to take for per leg. And then I have I do like one more level of granularity, I do like two leg clusters, and then I'll just I don't know like mathematically how sound it is, but I'll take like the same amount on two leg clusters. And uh I've come to thinking that's okay because like I've I've laid out like uh I guess some simulations on on like what I would realistically book, like if it was all maxed out like that, uh and then just like run a bunch of simulations and see like what your worst case scenario is and like how often that happens.

SPEAKER_01 1:02:13

And then you just has that bared out, like I know you you can sort of um ahead of time sim it and and get a sense of like you know, sim each leg if they all go as bad, like overweight on these sides. Is it bad? Has it has it played out that way? Have you tweaked it at all?

SPEAKER_02 1:02:30

Um like knockout would. I mean, I've never hit my max drawdown yet. And like the way I simmed it, it said that should that should do it like once in every 300 sessions or something like that.

unknown 1:02:43

Okay.

SPEAKER_02 1:02:44

So I don't even think I've had 300 sessions yet.

SPEAKER_01 1:02:47

Well, let's hope it stays that way. Yeah, I was I was just curious if you've you've actually like run into it yet. And because the reason I ask is in some respect everything you said made sense to me. It's how I think of the problem. But it's in some sense like academic to be like, okay, this is how much I could I could lose. And but it's a different thing. I really liked what you said though.

SPEAKER_02 1:03:09

I really liked what you said though of like I think the the most like solved way, I guess, of doing it would be like constantly having like a mark the market live sim of it. That'd be like the most thorough way, I think, of like solving it and seeing like, okay, should I go and like hedge this out or whatever? But I don't know. For what I'm doing, I'm kind of more focused on where I'm gonna play offense better. And I think that'd be like a little bit overkill unless you were gonna be doing something like really large scale and enterprise grid, especially if like you're a sports book, you know, and you can't just stop quoting something, then you might need something like that.

SPEAKER_01 1:03:48

It makes total sense to me. I I I I think I said Alan Show, like I can't imagine that's the highest like value thing. I think you sort of just need to, and that's why I asked, like, you sort of just need to have that bad day and be like, okay, that was probably too bad of a day.

SPEAKER_03 1:04:03

Um I think I've made that the open air. I'm not 100% sure, but that was a good one. Yeah, okay, so you said something there that is interesting, and it kind of ties into this like future-looking plans. But you said like what I'm now trying to do is play offense a little bit. Um, I think we're gonna come to a question later that I may be getting at to the the nexus or the or the reason that you would like to go play some offense, but like so you're right now from our conversation, seemingly we've only talked about making, but you're implying that you're either doing or want to be doing some taking.

SPEAKER_02 1:04:47

Oh no, I mean like my offense is is like market making. Oh, okay, I got yeah, just just writing volume at at a good hold. Just focusing on how I can do like how I can maximize that. I think that's that's a better use of time than like, you know, really trying to get ri super meticulous with your risk management model, you know, just do something crude that's probably good enough, especially if you have the luxury of being able to stop quoting.

SPEAKER_03 1:05:16

Right. Yeah, it's like that that risk model or like the hypothetical one we kind of kicked around would be awesome, but the the it's just so complex. Like the time to build something that didn't blow you blow up, like you know, because like with the complexity comes like all these like kind of unforeseen opportunities to blow your your whole thing up.

SPEAKER_02 1:05:45

It's just like the eight thing to do that like doesn't make you any more money.

SPEAKER_03 1:05:50

Right, but it's cool.

SPEAKER_02 1:05:53

It's a lot of work.

SPEAKER_03 1:05:54

Well it makes you money, it makes you money because it would allow you to bet more, right? So like if you were like If you were like in a spot where you were you didn't have your whole bank roll on the table and you felt like with your original risk parameters, you were saying like you can't take you can't write anymore here. But like with a more thorough view of what your risk actually was, you could write more.

SPEAKER_02 1:06:18

And then you Yeah, but it could also tell you, it could also tell you you gotta you gotta write less.

SPEAKER_03 1:06:23

Yeah, but that's not bad.

SPEAKER_02 1:06:25

Then it means then it means you don't you're like nah that I don't want to know that that'd be the worst result.

SPEAKER_01 1:06:35

I agree. You never want something that tells you to to bet less. That would be uh you know double double negative. So um I was gonna add, I'm glad John took us there because I I was gonna ask, it popped into my mind when you said you were collecting all the results. Like I'm interested personally in like some of the the taking side. I think the RFQ is like the most interested I've been in taking on the exchanges um so far, just because it goes back to my point of like some of these markets should not be quote, like we're gonna look back and they we're it's gonna be ridiculous in hindsight that they were quoted this this aggressively, I think. So like, is that it sounds like the answer is no, but maybe, maybe can you give a little bit of context on maybe why the answer is no on like taking, and maybe it's because you've not seen like in your data like the clear and obvious things besides court citing and whatnot. But I'm just I just feel like that data would be extremely valuable for identifying potential vulnerabilities in your competitors who are quoting these things.

SPEAKER_02 1:07:38

Yeah. I mean, when I was starting this, I was really hoping that there were I was expecting that there were gonna be like, you know, a good amount of IDs that are like fundamental takers, and I would like look through everything they bet and be like, oh, like look at all these like correlations between like these players and those players and try to kind of reverse engineer what they're doing a little bit. And especially if like they're confident enough in that to where like they think they can beat the fee. Um I mean, I I just have not seen that. Like I thought I was gonna see a good amount of people like that, and I like all the only people that have like made money off of me are like people that are just doing latency type stuff, or like exploiting the uh Damon Thompson, Azore Thompson, debacles.

SPEAKER_01 1:08:27

Hey, that's valuable information. I learned that you know without that I wouldn't have known that there's brothers, you know. Are you doing this for all sports? I I should ask, like like basically everything, or are you you narrowed down to a subset?

SPEAKER_02 1:08:40

Um, I do yeah, I just as of now I only have I didn't I didn't get this up and running ahead of the football season. I will be doing that obviously as that comes around, but I have what MBA, college basketball, MLB, and HL right now. I was thinking like, you know, maybe WNBA, but there's no player props in it yet, and I don't know how much reaction is gonna be. I don't know if it's worth spinning that up. Could maybe do golf, but you know, then you gotta hold everything over the weekend. You know, I kinda want fast turnover. Uh soccer. I never got around to doing soccer. I don't know how much volume that trades. I mean, maybe that can be another project. But there's really like if you look at all the sports and all the different markets within the sports on call sheet, there's it's it's really constricted when you look at like what you can actually combo.

SPEAKER_03 1:09:43

So have you at any point spent a serious amount of time while you were building this RFQ on anything besides RFQs on Call Sheet or no?

SPEAKER_02 1:09:57

Well, I want to migrate to uh ProfitX because I think they have something on there. But I mean I don't even know I don't even know any other exchanges besides those two that allow you to like publicly trade that stuff.

SPEAKER_03 1:10:13

Okay, so you so you're so uh I guess like my takeaway is you just laser focus RFQs and that's what you do on Golf Street. And like it's better to be good at I Yeah, I think that I mean that's you know, that that's a man after my heart, SP, you know, just you know, really grind, um focus in, grind it one thing, don't don't bother with with with having fun or trying new things, which but no, I mean I I really do think like like there is a big advantage because like the way hearing you talk about RFQs and like having been looking at or doing them myself, like it's so clear to me that like you're s like fully deep in the RFQ game, a game where there's a ton of money or a ton of recreational money and where there's not really like you're not really you're able to turn your bankroll over, also in a way that's like not too adversarial.

SPEAKER_02 1:11:22

So I mean I've just thought about doing other things, and I'm like, I don't think I'm gonna be able to like this is not gonna be able to print as good.

SPEAKER_01 1:11:29

I I just love it. I love it. Yeah, I mean I think I I think when we first talked about RFQs or early on, one of the things I said is like, I don't think this is the type of thing that you just sort of have do. Like this is not the thing you just you can just like dabble in and and do very well, I don't think. And so I think it makes total sense if this is like what you're focused on to do it. You know, there's there like in any of these competitive, competitive like areas, whatever they are, like you you need to be sort of like all in. I think I, you know, the difference is I just want to try and compete in the less competitive areas, right? Where I can dabble. But yeah, yeah, it makes it makes total sense to me. It's also like an enormously growing area of the the ecosystem. I know um the article is published by what's his name, Dan something, Dan Bernstein or something.

SPEAKER_03 1:12:24

Um the one with like the takers. Dan Bernstein.

SPEAKER_01 1:12:28

He he he wrote the article on like how much money um people have lost on Galsheet RFQs. And I saw like a I can't remember, I don't know if it was Captain Jack or someone else. It was flipped upside down. Yeah. I think it's it makes total sense to me. I also have heard um on Inside Prediction Markets, the Novig show, I think Henry said like he could see more of this stuff, more of the the just prediction markets in general going this RFQ way, like even like stuff like player props and whatnot, which I mean I don't really have a strong view of. I'm on the outside, but like it does make some sense to me if you want to like because the the great thing about RFQs is it allows you to get good prices to people in like a much less adversarial way because it's not out in the open. Right. So like that is that is the good thing about RFQs. I mean, you lose the transparency and like the true prediction market evangelists like cringe probably at the idea of RFQs. But in terms of getting people, you know, their bets, it's it's actually like a very good way of doing it for everybody, right? It's like again, reinventing the sports book from first principles and like being.

SPEAKER_02 1:13:44

Yeah, and I mean if you if you tap in any or any parlay you want on like Calci, and then you look at like any of the other main rec books, you're pretty much always getting a better price, even after the fee.

SPEAKER_01 1:13:57

And sometimes way better. And that's that's why I I'm honestly interested in in some of the taking stuff, is like it's uh I I feel like it is very right now just very competitive. Um, and people like I've I've dabbled enough to know like broadly what mistakes would be fairly easy to make. Um and I feel like anybody who's who's made for a little bit probably because that's the thing with it, is right, it only takes one person to to make a mistake, right? And yeah, it's not like the normal order book where someone makes a mistake, it's gone like immediately. Like on the R of Q, it's not like everybody can just see the it's not like the mistakes on an odd screen, right? It's like it's all back end code, right? So it's it's uh it's an interesting world, no doubt.

SPEAKER_02 1:14:44

Um it's a circle of life. I mean, you gotta, you know, when the making's too competitive, then you gotta start taking and get rid of all those people, and then you can make again.

SPEAKER_01 1:14:53

I've been sent to the Sharp Takers, you know. I've I've I've been on the record talking about it.

SPEAKER_03 1:14:58

So okay. First of all, I'm back on the Sharp Taker train. A lot of people recognize me as very pro-Sharp Taker. But uh what you said is Troy is like been my experience actually like with it with golf is like you need to have like you need to have the stick too, you know, the carrot and the stick. Like you you're out there, you're making, but when when people like just get over their skis and start offering, just thinking they can offer whatever price you know they want, the best way to make a ton of money market making is to go in there and just like just rip their face off for a while taking, like to have that ability to keep them in track.

SPEAKER_02 1:15:41

So then you can go back to making it jumping, like just throw out some junk to then they like undercut you and it's like wave above the market and then just pick them off.

SPEAKER_03 1:15:51

Right, right. And then like to to even like in uh I think that's where I think that's where having your number like your own number, if it's good, will end up being very valuable to it. Like I don't really think like having your own number from a traditional, like if you were in a not super competitive market, it doesn't really matter. You're trying to I guess at the end of the day, you're just trying to get in front of Rex and not not deal with sharps, right? But to now deal with the other makers, I think will though like you said, it's like a circle of life. Like there will be there will be a rise of the hash hashtag Sharp Takers. Like you'll have to be a Sharp Taker too, along with a maker, I think, in the long run.

SPEAKER_01 1:16:36

Yeah. And we'll know whose side they're on, GP. We'll know whose side the caretakers are on. Let's talk a little bit about future, and then we'll do the listener questions. Like, do you is this what you see yourself leaning into the next one to two years, all in RFQs? Um, like, do you have any thoughts or or opinions on like the current state of the legality of prediction markets, any of that? Like, or are you just head down working on this? I'll figure out the next thing if if I'm forced to figure out the next thing.

SPEAKER_02 1:17:08

Yeah, I mean, I'm already kind of like pivoting on another project that I want to be doing. Uh, I mean, it's what Captain Jack says. I mean, every market maker wants an exchange, and every exchange wants to be a market maker, so I kind of want to open some kind of exchange. I mean, it's really ambitious, probably not gonna work, but you know, that's I got some money and I could sit on it for a little bit and see if it's plausible or not. I mean, whatever. It's EV to take a shot at it.

SPEAKER_03 1:17:36

Well, that would be that's that's big. That's cool. Hey, do you wanna like any for people out there who might be interested in working with you or whatever, like any more deets on that?

SPEAKER_02 1:17:53

Yeah, I mean, I kind of want to keep that in myself for now.

SPEAKER_03 1:17:59

Fair, fair. Okay, yeah, I did I didn't know. I wanted to give you the opportunity, you know, because I know we we do pay you a lot to come on the podcast, but sometimes that's not enough. So it's sometimes good to get some economic benefit out of it.

SPEAKER_01 1:18:15

Um, that's cool. Okay, let's go to the listener questioners questions. The first from Cut and Paste. Do you do much live quoting trading? How do you deal with court siding for Cauchi where the delay is zero seconds? Now, I did I want to ask you about this. Obviously, like there's um proprietary stuff that like just like you you you said and alluded to dealing with um you know certain spammers, like we can't give away everything because the the RFQ stuff is competitive. But are you doing a lot of um the RFQ stuff live? And do you have any anything you could share related to this?

SPEAKER_02 1:18:56

Yeah, I mean, live is is most of my volume, and I think that's specifically because it's the least competitive, because it's it's difficult for people to deal with the court sighting. Um I can't really obviously give 100% on how I handle that, but one thing I will say is if you can filter out a lot of the people that spam the API, uh, you're gonna get a lot less of that. So that's that's one way you can handle that without me disclosing everything.

SPEAKER_03 1:19:28

I think that's pretty solid, that's pretty generous. Um so we'll how is it like the the I've I've gotten this from like a few people in gambling? Like, I don't know if you guys are big Harry Potter fans, but the f there's my cat. Hi, Luna. Hi. Uh but hey, okay, anyway, in Harry Potter, in the fourth book of Harry Potter, Cedric, like Harry like solves something for Cedric, and Cedric, like in return, gives him the egg and is like think it think it over in a bath or whatever. And then like it turns out he just has to go underwater and he can hear the egg. I think that's the that's the gambling advice I'm going for. It's like, look, this is kind of it, but you gotta go figure out the rest of it. And I I think that that's that's what what you did there. It's uh you know, so everybody can mull that over in a bath with a neck. Um anyway, uh this was the question I think that uh this is the question I was alluding to from Manny. He says, for RFQs, uh it seems like pricing is extremely competitive. I often find myself dropping prices lower than I want to win flow. How do you handle this? Um and I think there was another important uh post to this, I think it was plus C V Analytics who wrote about I didn't even remember what like the what it was called, but it was basically just like a winner's winner's tax or whatever. Like you get to a point where people are quoting unprofitable levels, and then like you have to sit out as somebody who's only going to be quoting profitable stuff. Like, how do you deal with what Manny's asking? How do you deal with like that phenomenon when like you want to be in there, you feel like you're not making any money if you're not in there, but at the same time, you're like, I can't really offer that price to win, you know.

SPEAKER_02 1:21:22

Yeah, I mean that comes down to like what I was saying earlier about like storing as much data as possible, and then you know, you can analyze spots where you can be more aggressive and spots where you could charge more, et cetera. Um and also there's I've never really like met anyone who's talked about this side of things, but I'm sure like there's some really big entities in this that like have some kind of deal with Colche or like they can quote affair and then they get like a rebate of some kind. And I don't know if they do that on RFQs, but like I would think that I'm gonna speculate and think that there's definitely some of that going on. Uh some some kind of predatory pricing.

SPEAKER_03 1:22:10

Yeah, I think either that or like if you have equity, right? Like, like let's say you're called she trading, like you'd be incentivized to quote RFQs at fair, right? If you were to quote.

SPEAKER_02 1:22:20

Yeah. Or you could be like Amazon and even quote it at like a loss. Yeah, so then everybody just gives up and then you're Yeah, I was gonna say you're actually incentivized to quote at a loss.

SPEAKER_03 1:22:30

Like that's a good point. Like that would be awesome.

SPEAKER_02 1:22:34

If you could create your call she and you quote at like 1% loss, but then you're taking in like 5% or whatever, however, it works on the curve of like fees, then you probably can't afford to do that.

SPEAKER_03 1:22:44

For sure. Please don't do that.

SPEAKER_01 1:22:50

Yeah, I mean, that's the interest of the uh the interesting part of the like the long-term internal trading arm of any of these companies.

SPEAKER_02 1:22:58

I know that's not your makers.

SPEAKER_01 1:23:00

Yeah, you're gonna balance that. Yeah, I think it's it's it's tough because I like I you can clearly make arguments for why you need internal trading. I think if especially like if you're smaller, in my head, it's always internal trading gets the market like off the ground, and then you want to get out of the way to make it like a normal ecosystem where you're not like playing games into. Um so yeah, I mean, I I think those would be some of the downsides if you if you have you know situations like like that. Um, let's go to the next one from John Rappaport. What's your mental model for driving and pricing correlation top down? So I know you had mentioned like using the unabated feed um in the past, which you know, obviously you're getting some some correlations there. Um is that primarily what you're relying on? If you're doing mostly live, I'm curious if that that holds or or there's other considerations where you've had to work through.

SPEAKER_02 1:23:56

I mean, without saying too much, like I don't make any of the models of my own. Uh I mean there's there's a lot of ways you could figure out how to get odds. Uh so yeah, I don't want to I don't want to speak too much in the specifics of that, but if you dig around, you could definitely figure it out.

SPEAKER_03 1:24:15

Yeah, I'd say like I think to your earlier point of like you didn't find anybody taking who like had a winning opinion on correlation. Right. So it's like as like making in a lot of like at least what we're doing, it's like not our own correlation pricing. I think you know, you could I do think that it'll evolve that way, like you know, having your own sim that correctly prices correlation, but you know, I think a thousand percent, yeah. But for you know, for us, like that's a totally different like that's a that's a completely different process. Like it's just night and day to compare it to, you know, because you're basically you know, you're you're top downing, you know, you're not top downing. You're when you're top downning it, like you can't break out the correlation, I think. Like in any way that would be meaningful to your pricing. Like it wouldn't help, right? Like to try and figure out like, oh, what does MGM think the correlation is here? Like to try and derive that. And that I don't know. I don't think that that would really do much, and it would be like this massive problem, but let's go to the next one then from Drizflow.

SPEAKER_01 1:25:38

I'd love to learn about his setup. Does he schedule certain things? What tools or resources does he use? What technology? Someone get a glimpse, something to get a glimpse of his overall process would be sick. So maybe you know the most important question. Yeah, I could talk about that. Yeah. You got to start with the most important part is is whether we are on um, you know, team, team codex or claude, or what are what are we running right now?

SPEAKER_02 1:26:03

I'm doing, I mean, I'm just doing the$200 a month Claude. Yeah. And with pretty much everything. I don't know. I mean, I'm not I I hear all kinds of engineers like poking holes in it and whatever, but I don't know. It just sounds like Coke to me. Like it'll eventually just get there and it'll know every little engineering trick possible. It'll it'll all come down to creativity at the end of the day.

SPEAKER_03 1:26:28

I did hear codex is like getting better. That that is what they're saying.

SPEAKER_02 1:26:33

I think it's quite good. I don't even use like I don't even use like the clawed code terminal thing or like the cloud. Oh, that's good thing. I literally just do it like in like how it would be like on your phone. I literally just do everything like that.

SPEAKER_03 1:26:47

Claude code terminal is I would say is is really helpful.

SPEAKER_02 1:26:53

But yeah, anyway, then that they answered the question. I mean, then what I do, I actually have everything all on a server, on a VPS. Um so I have like my quota on there, and then that quota takes a matching file, so it matches like what everything's called in the feed that I'm getting the the odds from, and then what everything's called in Call F. So like it knows like how to match that up. Um then I send it to that on the server via Telegram, and then I also have like all my knobs and stuff on Telegram, so I can change like what margin I want to quote at, what my risk parameters are. Uh, and then I have like another dashboard that shows like all my positions, my risk management. I can like freeze and unfreeze positions. I can sort like I can sort them a bunch of different ways. So that's kind of like what I do for everything. At first, I like just ran it on a laptop. Uh, but then I was gonna like be traveling and stuff, and I don't want to just like have it on the laptop and then leave. The house or whatever, so I want to be able to just have it on a phone and have it on a server that's always going to be reliable and I can control it all from a phone.

SPEAKER_03 1:28:10

Yeah, I'd I'd second like my if you can like migrating stuff to a servers are very like helpful.

SPEAKER_02 1:28:18

Um and you can get a little bit better latency if you go to wherever like close to what call she's is.

SPEAKER_03 1:28:24

Right. Right. Another another good point. Actually, this was a question that I just want to add on to here, but another good thing about having on a server is if you work with multiple people. We had an outline, we had a question in the outline for the future. Like, are you uh are you a lone wolf? And if so, like are you planning on potentially bringing in other people?

SPEAKER_02 1:28:47

Oh, I'm I'm 100% by myself, yeah.

SPEAKER_03 1:28:50

And we're getting a lot of like really profitable lone wolves um included, you know, in here. The the lone wolf movement's big right now.

SPEAKER_02 1:28:59

Yeah, interesting. What do they call it? The garage band market maker.

SPEAKER_03 1:29:03

Garage band. That was a good term. That was one of the first like good terms to come out of uh the early production market days.

SPEAKER_01 1:29:10

Do you have any interest in working with others, or do you feel like you're like like it would be hard to have another person realize the the value needed?

SPEAKER_02 1:29:20

Uh I mean it would have to if I did, it would have to be like someone who can compliment me in spots where like I'm weak, like someone who's really good at doing mains, but doesn't know how to do RFQs, so there would have to be like you know, a trade equilibrium with that. Um and then obviously, you know, you could always use more money to scale as big as possible. You could always use some political pull if you can be one of those people that gets the quad fair and get a rebate. You can kind of like I don't know, rub shoulders with the call tree people a bit. I don't know, that would be that's at the top of my head, some some good partners.

SPEAKER_03 1:29:59

There we go. Well, this is a good spot to uh to shit to try and find some. Um we had uh was there anything like I was I was trying to okay, so we have the cloud, we have the cloud codecs. We we got to we got to hear about your server. Um are you for your dashboard, are you using like Streamlit? Or like what are you building your dashboard in?

SPEAKER_02 1:30:26

Uh I mean, I'm like such a novice coder, man, that like I don't even know what it's called, but it's just uh it's just a button that's like on on Safari that I like a web extension almost that I click it and it's got everything. Looks just like an app.

SPEAKER_03 1:30:42

Okay. Cool. Oh, it looks like an app.

SPEAKER_02 1:30:44

So it doesn't run on oh it's no I could I could run it like on my desktop if I want. Yeah, it's just yeah, yeah.

SPEAKER_03 1:30:51

Yeah, I think that's that's that's a that's a thing like with with anything where like there's not a lot of like good uh UI for it, like RFQs or you know other things.

SPEAKER_02 1:31:03

No, the calls for UI sucks. Like you you'd be like if you're doing you know thousands of bets a day, like you have no idea where you're at if you're just looking at Cal Shi.

SPEAKER_03 1:31:12

Right. And that that's like the whole thing, it's like this whole visualization. I think that's like under talked about is yeah, post trade or just like like visual, like where am I at right now? Like it's not necessarily simple. Like, what positions do I have right now? Like, I don't know.

SPEAKER_01 1:31:30

Yeah, I would I was quoting some some RFQs this weekend, and it just came through with individual athletes' names and like yes. And I'm like, I don't know, yes for what? Like, what did I just like I'm not really sure? And you you can't even see it, you know. Like even if you click on it. Click on that, what does it click on it? You don't even see what it's for. So yeah, um, yeah. The first thing I I was building this weekend was what what is it yes for? What did what did what did we actually just quote? What was that? Yeah, yeah. Um rich Richard, what types of market sports do you sports categories do the PMs lead in in terms of price line moves versus the books, sharper books? Have you seen a change in the last couple of months? So obviously we we've talked like you're primarily focused in in um in the RFQ space. I don't know like to what extent, maybe the way we could reframe this question is like to what extent have you done work to sort of like evaluate what what to use as the source of truth? Has that been somewhere you've you've used a lot of time and effort into or you know, there's a million projects that probably could go on with RFQs and like where you want to spend your effort is is the source of truth and like refining that an area you've spent a lot of time on?

SPEAKER_02 1:32:51

No, not really in in RFQs. I mean, like any any model that you're gonna find, especially for like sand game parlays, isn't I mean, I don't even think anyone has one yet that's like the nuts that like every is an industry standard that everyone could like copy. So I mean it's more so just slap a line up there and limit anyone who gets you.

SPEAKER_03 1:33:16

That's uh almost certainly gonna be the intro to this. There's a lot of good lines from it, but that that one's uh that one's a contender. Um I think so Daniel's question was about uh you know how long have you been doing this and competition change? So we we answered that one uh earlier. Judge Judy's question, I I think this is an interesting question. So he asked, How worried are you that in a few months the books will start skewing their quotes? So I think to great questions assume, yeah, exactly. To to just to clarify what I'm pretty sure is being asked here is like a lot of a lot of us uh you know like scumbag market makers are using some pricing that already exists on other sports books, and these sports books know this, and they're also getting into the they're getting into the trading space themselves, um, has been announced. Yeah, so exactly. Like what are you worried that they'll start spoofing like on their on their book and and doing something on PMs?

SPEAKER_02 1:34:23

Yeah, yeah, that's that's a that's a really interesting question, and there's like a lot of parts that go into it. Something that really surprised me was that FanDuel is gonna be like on these external third-party tradition markets, implying like call sheet, which I actually saw a video of yours like a couple years ago, and you were talking about like why FanDuel isn't like the sharpest it can be. You're like just anecdotally using them as an example, and it's because it it's way more profitable for them to just get a bunch of people into their book who are idiots than it is to you know maybe spend a lot of money and get like the sharpest lines so they can hold like half a percent more or whatever. It's just not worth their time. So I'm surprised they're even like doing this in the prediction markets. And yeah, does it make sense for them to spoof markets? I mean, well, one, if you're gonna do it on call sheet, it's literally gonna, it's literally illegal, and they want to have they want to have prediction markets themselves. So if if they want to be allowed to do that, you know, I don't know if that's the best idea. But I mean, it could also be good to just get everybody out of there who's copying them, and then they have free reign on posting their own prices. So yeah, it'll be interesting to see, but I mean my gut just tells me it's not really worth them doing, and it's I mean, it's it's literally illegal. So whether they can get around getting caught for that on some technicality, I don't know. But I mean, they're just like such a massive business that getting involved on trading and calci just seems like small potatoes and a lot of risk that do something like that.

SPEAKER_01 1:36:04

I agree with that 100%. I mean, I think we talked a little bit about it last show. I feel like the reason they're doing it is to, at the end of the day, like FanDuel's success in prediction markets is not going to be because they made a bunch of money trading on Calci's prediction market. It's gonna be because they are the prediction market. And so I feel like they're just trying to learn and get their traders up to speed to like actually trade on their prediction market or whatever when they when they roll it out in the the fall or whatever. Um big huge corporations generally um are not in the business of you know, you can you can give me some good counterexamples. Generally, they're not in the business of committing crimes.

SPEAKER_03 1:36:47

So uh yeah, I wanted to follow up on Troy's like, because there was this whole conversation around this where it's like, is this insider trading? But it's like you're not even asking the right question. It's not insider trading, but it is illegal, like it's certainly illegal, yeah, exactly. So like there was that whole conversation on Twitter, which like was the stupidest conversation ever. But like it, yeah, it's just it's not insider trading.

SPEAKER_01 1:37:13

It's not clear, I mean, uh, you know, not a lawyer, it's not clear to me because like clearly doing something to the order book, whatever, like my understanding is that is illegal. Like doing something on sports betting with the guys that people are gonna copy you and go to it, like that is not clear to me whether that's actually illegal or not.

SPEAKER_02 1:37:33

Um yeah, but are they gonna fuck around with it? Are they gonna take?

SPEAKER_01 1:37:36

I don't think they're gonna like I think I think, yeah, no, I don't I think they're like just not gonna do it just because it's not worth their time or money or effort when they're this big. Yeah.

SPEAKER_03 1:37:45

I think they could do it just to fuck with people. I don't think that would be illegal. Like, like as long as they're not in there like taking. I think if they're in there taking, like it becomes a very difficult um if they're taking on the market that they have like said, like, move this now.

SPEAKER_01 1:38:04

It just seems wrong though. Like, what right does someone like that no, no, you're right. Spoofing is like imagine being that lame. Like you copy Fandule and then you'd be like, Fan, like then you file a lawsuit because FanDuel No, it's lame. Like that is like I don't it might be I don't you can't comment on the legality. Like that would be the lamest thing I've ever heard in my life.

SPEAKER_03 1:38:24

Like so I I think spoofing is a stupid, stupidly illegal, Troy. This is my like one of my I'm not saying that I would ever do it because like SP said, like it's just crime doesn't pay. But I do think like there's annoying situations where you're the originator and you want to spoof and like fuck over somebody who's just stealing your information, and like you can't do it. And that's across that's not that's across asset classes, like not just with prediction markets, but yeah.

SPEAKER_02 1:38:58

But then if you're not getting filled, you just leave and then it kills the market. So I mean you gotta there's just yeah, there's there's gotta be like some of that allowed, I guess, to like keep people honest. Because if you lose the originator and everyone's just copying the originator, I mean, then then you lose the whole market.

SPEAKER_03 1:39:14

Right, right, exactly. So I you know, I do think like spoofing rules, like in general, like that sub that subset of like this is illegal is overly penal to originate.

SPEAKER_02 1:39:27

I mean, you could even do it like I mean I think you guys were talking about this with Iggs V and I think Chris and Henry were talking about this, like how the whole how the whole like college basketball market and and March Madness, it was like all propped up on pinnacles for like$5,000 limits or whatever, and then you would see a lead eight volume, you'd see a lead eight liquidity top of the book for like$20 million. And it's like, you know, you could just like bump pinnacles line with like a few good limit bets and then just get like a really good price for millions and millions of dollars, you know, if everyone's just copying pinnacle.

SPEAKER_01 1:40:05

That's what I'm saying. Like to me, I I'm confident the just participating for long enough, like these happens in spots.

SPEAKER_03 1:40:12

Oh, for sure.

SPEAKER_02 1:40:12

You know, so like well, that was a great tweet by uh then you can get rid of everyone who's doing that, and then you become the maker, circle of life.

SPEAKER_03 1:40:22

Right, which but that's why unfortunately these the that this is exactly why I do think like the spoofing rules in general are overly penal because you should be able to do that, I think. Yeah, but you know, free market, but but these are the rules. But that was a good tweet by I think is a good it's like a good account on Twitter who who's just kind of in the replies a lot. I think it's prediction watch, who was like asked a question like what percent of people right now are committing crimes on Call She and Don't Realize.

SPEAKER_01 1:40:55

I mean, there's honestly one of the first I like learned of, you know, that that those I still am not an expert in all these laws or whatever, but like it's just very clear. Like there are games being played on like overnight stuff and already. Like so I don't to me, you put up like not legal advice, not financial advice, not tax advice, not any like you put up an order on the market, like you are accepting that it could be taken. That's legal, that's fair game. For whatever reason you do that, you do that, right? Like that's that should be the the brill, in my opinion. I agree with that.

SPEAKER_02 1:41:30

I agree, free market.

SPEAKER_01 1:41:31

Yeah, I agree. I think, yeah, I think yeah, it's not like you're you're protected. Like if you said, Oh, actually, it was a joke order. Like, no, you had every you know, that could have been taken. So right, right. I agree with that.

SPEAKER_03 1:41:45

Like, who's to say that you who's to say that you didn't mean to fill that at that second? But like, you know, but anyway, I would love to hear everybody's opinions on on spoofing rules. Maybe this new CFTC will create no uh spoofing allowed in prediction markets.

SPEAKER_00 1:42:03

It's probably at the top of their list. Um it could be, it could be.

SPEAKER_01 1:42:06

Um, do you have a hot take that sharp gambling Twitter? You obviously have been, you know, in part of gambling Twitter. Now you're part of prediction market Twitter. I don't know if you want to, you know, if you want to have a hot options, you know, take, I would accept that as well. But a hot take that the people of Sharp Twitter or your peers would disagree with.

SPEAKER_02 1:42:33

Uh I think a lot of people like to say they're they're handicappers and they try to like beat these really liquid markets, and they just are not, they don't have any information that is like nuanced or anything creative that like you couldn't get anywhere. And I don't know. I'm sure there's people that do it. I'm probably gonna be wrong, but I just think that's like I think that's like not a very efficient endeavor. All right.

SPEAKER_03 1:43:03

I've Naple had a good point on this. He's like, cool, like the best NFL originator in the world on sides made two units. Like I was just like spamming SGPs and made, you know, it's like so true.

SPEAKER_01 1:43:19

Right. I mean, obviously, like when we had that discussion, like the units are different. Sure, sure. But you know, yeah, so like the size of the units different. But yeah, I mean, I I it's a conversation we've had a couple of times with different guests who do different things. I think you know, differ differ different people have different skill sets and whatnot. But um, if you're just trying to make like the most money, I would say for the vast majority of people, um that is not a good use of your time.

SPEAKER_02 1:43:47

No, and you should do, you know, you should be in markets that are appropriate to your bankroll. Like, you know, if you're gonna bet one percent of your bankroll and you get a hundred grand, you know, you should only be participating in markets that are like a thousand bucks. You know, you shouldn't why try to beat something that's taken like a hundred grand, trying to beat something that's taken a thousand.

SPEAKER_03 1:44:08

Well, SPS is optimal market sizing. I forget what it was, but it was like half the max bet or something.

SPEAKER_01 1:44:14

You said Yeah, you're starting it to be like 50 to 60, so that you you could you have some room to grow, but it absolutely shouldn't be to your point, like you can bet$5,000 and you only want to bet$100 today. Right. Yeah, that is not a good fit for you. So it's right. I I you know, I think you want to leave some room to grow, but because you don't want to just immediately get good at the market and then be maxed out, but you also said that I was like, oh shit, like that's definitely right.

SPEAKER_03 1:44:45

Because I I was like, I was uh I'm a max better, you know. Like if you're not if you're not officially betting like 100% max, like what are you doing? But like go down in the market, basically like go down stakes or whatever, because it's but I don't think about these second-order effects of of learning and building.

SPEAKER_01 1:45:07

Okay, it sounds like maybe that was a Bayesian update for you a while back. Last last section was a was a Bayesian update. I can give mine quick. I really didn't I didn't have one. I was trying to think of one right here before. Mine, I guess this is a true change your mind, um, real time. And we we can talk about it more more next week. But like, you know, Calish's first tweet, I I was like out on it. I'm like, okay, it's just like clearly like, does he actually not like like what is going on with this tweet? Like, let's all dunk on him. The fact that he's like he's like in the replies and he's gone on for like four days now, like a new level of respect. Like he wasn't one tweeting out. Like, I'm enjoying what's going on over there. So I hope he has the stamina to keep it out. But that was like truly something I changed my mind on. That he's just like full rage bait at this point. It's like it's great, you know, great to see him mixing it up with everyone. He's had some good burns, too. I like it's good. Like he's he's had like if you read through you know the threads, like he makes a lot of really good, like the guy obviously like is not stupid. He's he's worked at a big two, he's he's taken draftings from like a very small company to an enormously big company, and obviously other people involved, but like he understands the market. So he was there. I think he he's towing the line of like rage bait, serious, back and forth. Like he's got it down. Like, I it's actually a shame that he was locked up and not able to tweet seriously for so long.

SPEAKER_04 1:46:36

Like, yeah, I know.

SPEAKER_01 1:46:38

It's like we've missed out on his prime years of tweeting. Like he could have been. Oh, he's still he still can't be bank. Yeah, yeah. Yeah, he's got it down. So that's my my update.

SPEAKER_03 1:46:47

His uh you're right, like he has this really interesting mix of like and the thing was like I came I came in and like kind of agreed with him, and then he like he didn't like come at me, but he like he has this weird thing of like retweeting and then responding and then retweeting the responses, and then like when he's when he's like so you don't even know, like you lose his threat. So, like you there's no way that you can stay. You can't follow him around in an argument, and then he has people like chasing him, and that just looks stupid if you like come into his like new reply to the retweet or whatever. Like, it's it's really top tier, it's top tier stuff.

SPEAKER_01 1:47:32

That's what I'm saying. I'm I'm I'm disappointed. Like, we could have had a decade of this if he if he had stepped down earlier.

SPEAKER_03 1:47:37

So yeah, I guess that's my update. My uh yeah, I I had a I had a couple I had a couple uh ones, but one I was thinking of for a while was like I realized that like my attention span has been lowered in other areas than just like social media and stuff. Like I was literally on the plane like listening to music and I was like listening to a couple of songs that they're good, they're good rap songs like uh Yonkers by Tyler the Creator is a good example of this, but it's like the look how smart I am rap song, where like everything's like really clever and like a good rhyme, but they're but there are these like three to four second snippets, and the song means nothing, and there's no start, there's no like but it's just like one after another. It's like these little dopamine hits, and I just like am like I love this. And then when anything like from like J. Cole comes on, where it's like a longer, more like connected thought-out song, I'm like snooze, like pass. And now I'm like, I need to kind of I don't know, I just want to like kind of nurture that desire to have like a little more oomph to stuff I'm engaging with, and like I I feel like it was only something that presented itself like in social media and like short form video, but I do find myself now in like other entertainment forms, like kind of falling. Not that like I think Yonger's a great song, I think that's a great song or whatever, but like but like I need to make sure that I get my brain back on track to be able to like stay and enjoy like longer, more thought-out things because those are those are also quite good.

SPEAKER_01 1:49:21

How's the meditation going for you?

SPEAKER_03 1:49:24

I'm doing it. Uh it's that's the only thing that helps.

SPEAKER_01 1:49:28

I do say I I I was worried we when you described this, I'm worried you fell off the boat on the meditation.

SPEAKER_03 1:49:34

I did, I did, but I'm I'm back on the last week, which was when I was having this basically like moment of like, why do I only like these songs that have like four second bits to them? I'm like, oh, because like I'm my brain's fucked. I'm on Twitter and I don't do any meditation anymore. So anyway.

SPEAKER_01 1:49:55

That's a good one. All right. Do you have one for us, Troy?

SPEAKER_02 1:50:00

Um I mean just in general. I used to think like you had to be s like do anything like this. You had to be such a good like engineer computer guy. And uh I don't know now just with how every how good everything's gotten with like with AI, I mean it's shifted back to where you can just be someone who's creative again and has an idea. And it's it's just never been easier to execute something than it is today.

SPEAKER_01 1:50:31

Yeah, I mean when you were when you were describing like your your dashboard and uh and you were like I don't even know what it's in. I was like in the back of my head, I'm like, what a time to be alive, you know. You know, like you you didn't even know what it's built in, but you you described an extremely complicated like dashboard. So I uh I second that. I think you know that's a a good takeaway from this episode.

SPEAKER_03 1:50:55

I third it. Um, I think that's a good wrap-up. Do you uh any and well thanks for coming on? This is where like if people want to reach out to you, a good place to find you is should we say Twitter?

SPEAKER_02 1:51:08

Yeah, just Twitter's good.

SPEAKER_03 1:51:10

Okay, that's at Troy Cuban. I'll put your your link in the uh description. But yeah, thanks, thanks for coming on. That was really good.

SPEAKER_02 1:51:19

I think Yeah, my pleasure.

SPEAKER_03 1:51:21

One of the most like focused RFQ um pods I've heard, you know. I'm people love the RFQs, you know.

SPEAKER_01 1:51:30

He you Troy was a little nervous. He said he had he had he you he he he felt like he hadn't nothing new to add, and uh, I think you added a lot new people love the uh the RFQ discussion, so we appreciate you coming on.

SPEAKER_03 1:51:43

Absolutely, and thanks for everyone for listening and and questions, and uh we will see you on the next episode.