Real sports betting?

The article from The Onion about seniors being able to put some of their social security money into sports betting was, it’s safe to say, a satire. But the New York Times has an article that might or might not be legit.

From the New York Times:

Dallas Mavericks owner Mark Cuban says he plans to start a hedge fund, run by professional gamblers, to make bets on sporting events.

In a 1,278-word Web log posted over the weekend, Cuban said a gambling hedge fund would be no worse than the stock market, which he compared to a Ponzi scheme, with some people trading on inside information and others buying stocks on emotion.

Hedge funds are high-risk investments that cater to wealthy individuals and institutional investors, such as pensions. Their number and size have grown wildly in recent years. They are only loosely regulated and are not required to make filings with the SEC, a spokesman said. The agency declined to comment on Cuban’s proposal.

In his weekend posting, Cuban said he has “done very well” in stocks over the past 15 years but that for many investors, putting money in stocks is nothing more than gambling.

Cuban added that from “minimal reading and conversations” about sports betting, there are smart gamblers who win repeatedly, which he attributed to the vast information available about sports teams.

In casinos, he added, “Unlike the stock market, you know the rules exactly. You know without question, the house is going to play by the rules. The gaming commission appears to actually enforce rules of play, unlike the SEC.”

Cuban did not respond immediately to questions from The Associated Press

The New York Times > AP > Business > Cuban Proposes Betting Hedge Fund

I take it that this is more of an indictment of the stock market than an endorsement of casino gaming as a sound investment strategy, but this is still striking. Part of me keeps thinking this might be another spoof article.

But a visit to proves otherwise. Here it is, in Cuban’s own words:

I�ve decided to start a new hedge fund. However, this hedge fund won�t invest in stocks or bonds, or any type of business. It�s going to be a fund that only places bets. A gambling hedge fund.

It won�t be me figuring out what bets to place, or what games to play. This is a fund. I will find the best and the brightest, with a confirmable track record and hire them.

It�s an idea whose time has come.

I have bet on stocks long and short for about 15 years now. I�ve done very well. There has already been one hedge fund started based on my trading results. In those 15 years, I have learned that despite all the claims and books written about efficient markets, the trading of individual stocks are not efficient. There are always people trading on better or worse information. There are always people trading on emotion rather than logic. There are always people trading on hopes of the big hit. What Peter Lynch would call the �10 Bagger�. They were gambling. Nothing more. Nothing less.

It�s not unusual to hear people refer to trading stocks as no different than going to Vegas. They are right. Gambling is gambling.

The question really is, which gives the opportunity for a better outcome?

My New Hedge Fund

While your over there, I’d also check out Cuban’s post about Donald Trump’s bankruptcy, in which he asks DJT the burning question:

Can you compete with the Borgota, which has been kicking ass in Atlantic City?

He also takes a couple of digs at the Donald, asking if he’s going to just bus in quarter players. Ouch.

The scary thing is that a gambling hedge fund might actually work.

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