HOW TO MAKE GOOD BETS
While over 98% of bettors losing in the long run,
it really doesn't have to be that difficult.
A Beginner’s Guide to Making Good Bets
Warning: if you’re a pro bettor or an aspiring pro hoping to make millions in sports betting, don’t read any further. I beg you, please don’t - it won’t go well for you or for me. But if you’re a sports fan and/or casual, low-to-mid stakes bettor who just wants to bet because it’s fun, perhaps in a newly legalized jurisdiction (like my home of Ontario), this article is for you. I’m going to show you how to tilt the odds in your favor with zero knowledge required other than how to click a mouse. Oh and also, you can do it while betting the stuff you want to bet. Like to bet Monday Night Football overs so you can root for action? Great, have at it. A fan of the (gulp) Montreal Canadiens who wants to bet on them to win every game? I just threw up in my mouth a little but sure, you do you. Bet whatever sports, bet types and teams you like.
The way sportsbooks make money is by giving you odds on your bet that are a tiny bit worse than what a fair price would be. For most standard bets at most standard sportsbooks, the amount by which they shortchange you – called “the hold” or “the vig” – works out to around 4.5% of the bet amount. This means that over the long run an unskilled bettor will lose, on average, 4.5 cents of every dollar they bet. Of course, this doesn’t mean it’s impossible to win. Anyone can get lucky or unlucky on any given day but over a large enough number of bets when the good luck and the bad luck even out, that 4.5% loss is what’s left over. The mechanics are the same as a roulette table where anything can happen on any spin, but if you add up the total results over a week/month/year “the house always wins”.
You can think of the 4.5 cents on the dollar as a kind of a tax that you pay for the enjoyment of betting. Now, wouldn’t it be nice to look at your tax bill and see a smaller number? Or even (gasp) a negative one? It’s easier than you think. Two steps, no skill required, and you don’t even have to change what bets you’re making. Ready? Let’s get to it.
Step 1: Open accounts at as many different sportsbooks as possible.
There are two reasons for this. We’ll get to one of them in Step 2. The other one is that most books offer a sign-up bonus when you register and make your first deposit. The bonus typically goes something like this: the book contributes an amount of money that matches your deposit, but you have to “’earn” that bonus by making bets totaling a certain amount (usually 5x to 10x the bonus amount) over a certain period of time (usually 7 to 90 days following your deposit). Sometimes you don’t get the bonus until after you’ve completed the wagering requirement. Sometimes you get it right away and can bet with it, but you can’t withdraw it until you’ve completed the wagering requirement. Sometimes you get it automatically when you deposit. Sometimes you need to click something to claim it. Sometimes it’s supposed to be added automatically but it doesn’t happen, and you have to complain to customer support. Read the terms and conditions of the bonus carefully!
Let’s quickly run through the math on bonuses. Suppose you are awarded a $200 bonus with a 10x rollover requirement. That means you need to place a total of $2,000 in bets to earn the $200 bonus. Your earn rate is 10 cents of bonus earned for every dollar you bet. If you subtract the 4.5 cents of tax that you’re paying, you’re already in the black by 5.5 cents on the dollar and we’re only halfway through this article.
Now, a few caveats to make sure you understand what you’re getting into:
- Your 5.5 cents on the dollar is not a guaranteed profit, it’s a theoretical long-term expectation. Congratulations, you’ve achieved a state of “positive expected value” (+EV) which is the gambling version of the holy grail. But, your actual results will still be subject to the whims of Lady Luck. It’s very possible that you could lose money even after the bonus. Gambling is risky, +EV or no +EV. Don’t bet money that you can’t afford to lose.
- You only get a limited time period to do this, so time it for when you want your betting to be the most active. Want to bet NFL? Don’t open those accounts yet, wait until September.
- If the bonus is of the type that you don’t receive it until after you’ve completed the wagering requirement, and if you’ve lost your entire deposit amount before completing it, you’re in a sticky situation. Your options are to make another deposit and continue working toward your bonus using your refreshed bankroll, or to stop wagering at that book and forfeit the bonus. Obviously the former is a better strategy but again, don’t bet money that you can’t afford to lose. If your gambling budget is tight, think about planning ahead for this possibility by making a smaller initial deposit (and earning a smaller bonus with a smaller wagering requirement) so that you can keep some ammunition in reserve in case you need to reload. You can also make a withdrawal from a book where you’ve already cleared the bonus in order to move money to an account that needs it.
Pretty easy so far, right? Let’s keep going…
Step 2: Use an Odds Aggregator Like betstamp
Story time! A long time ago I worked for a company that sold car insurance. When we analyzed our profitability, one pattern was clear year after year. We made money on the customers that came to us directly, and we lost money on the customers that came to us through one of those quote aggregation tools where you enter in your information and it automatically searches a bunch of insurance companies and finds the best price. Why? Because those customers were the most price sensitive. They found the spots where our pricing was the weakest and they hammered them.
An aggregator is like a vacuum that sucks up maximum value for the end customer with minimum effort. Use them as much as you can. And guess what? betstamp functions as an aggregator for sports betting odds! All you have to do is decide what you want to bet, then go to betstamp to find which book is offering your bet at the best price.
To demonstrate how this works to your advantage, I’m going to borrow the concept of “synthetic hold” from Ed Miller and Matthew Davidow’s excellent book “The Logic of Sports Betting”. Here’s how it works:
Suppose there are two books offering odds on the same hockey game.
Maple Leafs at Book X -180
Canadiens at Book X +150
Maple Leafs at Book Y -160
Canadiens at Book Y +135
Each of these two books is charging a hold of around 4%, pretty standard stuff. Now consider this betting strategy: if you like the Leafs, take them -160 at Book Y, not -180 at Book X. If you like the dreaded Habs, take them +150 at Book X, not +135 at Book Y. By line shopping, you’ve created a market for yourself that looks like this:
Maple Leafs at Book Y -160
Canadiens at Book X +150
This “synthetic” market built out of two separate books’ lines has a hold of only 1.5%. No matter which side you bet, you’ve cut the tax rate you’re paying by more than half! This is the power unleashed by shopping for the best lines, a power that an aggregator like betstamp can supercharge by doing all the work for you. And, that power grows even stronger with a larger number of different books among which to shop. On a busy sports day it’s common to find synthetic holds below 1%, sometimes as low as zero - and if you’re really eagle-eyed you may even find the occasional one that’s negative! It takes a little bit of math to calculate synthetic hold, but we can spare you even that with this simple approximation: take the best price on each side (in American odds form) and add them together. So, -160 and +150 would give you a total of -10. Anything that adds up to between -5 and -1 will generally give you a synthetic hold between 1% and zero. Anything that adds up to 0 is a synthetic hold of zero, and anything that adds up to a positive number is a negative synthetic hold.
The combination of bonuses and line shopping is a one-two punch that will tilt the odds quite substantially in your favor. Now is the time to test the warning I gave at the top of this piece, because professional bettors who read this will be screaming at the top of their lungs “they’ll limit you! They’ll kick you out!” And yeah, it’s possible that they will. This strategy is a winning one for you, which means it’s a losing one for the books. And guess what? Books don’t like to lose. If they think you’re not a player who will make money for them (by losing money for you), they have every right to limit your bets to pennies or close your account entirely. You can read more on this here. If this happens, you still get to keep any money you’ve won - they can ban you but they can NOT stiff you. This is where it’s important to have the mindset of a recreational player. These accounts are your entertainment, they’re not your livelihood. If you lose one or two of them, keep going with the ones you have left. And the smaller stakes you’re betting, the less likely that you will even attract their attention in the first place.
One question that you may be asking: “what if I bet the Leafs -160 AND the Habs +150? If that helps me clear two bonuses, won’t that make money?” Yes, it will. You’ll put in a lot of effort, clear a few dollars and the whole thing will feel like it work. You won’t even enjoy watching the game because you no longer care who wins. Who needs it? Dear reader, you’re better than that. For sports fans, betting is not an investment. Betting is entertainment. It’s fun. You have an opportunity to enjoy this thing that normally costs 4.5 cents on the dollar, for free or possibly even for negative cost? (One more time, I’m talking about “cost” in terms of hypothetical long-term expected value. Gambling is risky. You could get unlucky. You could lose. Don’t bet what you can’t afford.) Why hedge out of all the fun? Enjoy the ride!
So that’s all there is to it. Open accounts at many books, and use an odds aggregator like betstamp. You get to enjoy betting on whatever you like, and this simple strategy is enough to tilt the odds in your favor. Good luck and have fun!