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The Composed Market / The requests
One question, a queue, and an answer that arrives three hours later

The request behind a composed market, and what answering it costs

A request is a customer asking an operator to invent a market. It arrives in a queue, it is priced by a person using a model, and it can come back accepted, refused, or not at all. The timings and the cost of that queue are the least visible part of the product and the part that explains most of its behaviour.

Desk spec
requests, one month
500
median time to a price
3 h 40 m
answered within an hour
12.0%
cost per request
41.07
the composed priceThe number returned for a set of outcomes the customer named. It is not the product of the legs: on the samples 5.60 multiplies and 4.80 is offered, because the legs happen together more often than independence implies.
the requestA customer asking an operator to invent a market. 500 arrived in the sample month, 218 produced a price, 131 could not be priced at all, and the median answer took 3 hours 40 minutes.
the void legA leg that never happens, repaired by re-pricing the combination from its remaining legs. Dividing the price by the void leg gives 4.50 where the real three-leg price is 4.80 - a 6.7% error.
Direct answer

A request is a customer asking an operator to create and price a market. In the sample month 500 requests arrived, 218 were accepted in a median of 3 hours 40 minutes, 131 could not be priced at all and 37 were never answered. Answering one costs 41.07 of trader time, so the queue spends 20,535.00 a month and 5,380.17 of it on requests that produce no market.

What a request contains

Four fields, and every one of them can be the reason the answer is no. The selection: what has to happen. The market and the event: which match, which competition, which settlement rule applies. The stake the customer has in mind, because the price offered is a function of the size the operator would have to hold. And the time the request was made, which fixes the version of the model that prices it.

The fourth field is the one readers rarely consider. A request that arrives twenty minutes before a kick-off is being priced against a model whose inputs are still moving, and the price that comes back may be a price the operator is prepared to hold for seconds rather than hours. The samples do not show a single timing rule across operators, and they do not need to: what they show is a queue, and in a queue the answer depends on when the question was asked.

What the samples show

Sample B - the request queue in one month: outcome, share and time
OutcomeRequestsShareTime to the answer
Accepted and priced21843.6%Median 3 h 40 m
Refused on price9619.2%Median 2 h 10 m
No market possible13126.2%Median 1 h 05 m
Never answered377.4%No answer inside 26 h
Withdrawn by the reader183.6%Median 45 m
Every request in the month500100%A quarter answered inside 1 h 10 m
sample H - what one request costs to answer trader time on a request = 22 minutes costed at = 112.00 an hour cost of one request = 112.00 x (22 / 60) = 41.07 requests in the month = 500 queue cost for the month = 500 x 41.07 = 20,535.00 queue cost for a year = 20,535.00 x 12 = 246,420.00 cost per accepted market = 20,535.00 / 218 = 94.20 so one published composed market costs 94.20 in trader time before any of the money staked on it is counted.
sample H - the requests that produce nothing never priced, never answered or withdrawn = 131 + 37 + 18 = 186 share of the queue = 186 / 500 = 37.2% cost of that share = 186 x 41.07 = 7,639.02 narrowed to the 131 requests no model covered: cost = 131 x 41.07 = 5,380.17 a month a year = 5,380.17 x 12 = 64,562.04 and the 186 that produced no market are 37.2% of the queue, spent in full against a customer who asked a question the operator had no product for.

Why the timings matter to a reader

A composed price is a snapshot. Between the request and the answer the underlying inputs move, and the model that produced the price is the model as it stood when the request was worked. The practical consequence is that the fair comparison is not between two operators' answers to the same question, but between one operator's answer and the moment it was made - which is why /the-record spends its time on what the operator keeps, rather than on what the customer remembers.

Five things to hold on to when you request a market
  • Write down the exact wording of the selection, including any settlement rule the price depends on.
  • Note the time you asked and the time the price arrived; the interval is part of what you are buying.
  • Ask what stake the price applies to. A price quoted for a 25.00 stake is not an offer at 250.00.
  • Ask whether the market, once priced, will be published to other customers and whether that changes the figure you were given.
  • Keep the confirmation. If the price is disputed later, the only record of what was offered is the operator's - see /the-record.

Read next

The refusalsThe four reasons a request failsThe published marketWhat happens once it is pricedThe recordWhat the operator keeps, and you cannot seeThe arithmeticOne month in money