Betting Knowledge

Overround Explained: The odds offered by bookmakers are unlikely to correspond exactly to the actual probabilities of the outcomes in any market happening, as no bookmaker is likely to operate without trying to offset its costs (and trying to make a little something on top)! Bookmakers are likely to be taking money from lots of customers over the possible outcomes – they may try to guarantee themselves a profit regardless of the result. Bookmakers may start a market by working out the actual probabilities of the outcomes in a market occurring and then incorporating a profit margin into the odds, but as money comes in on the market they will often adjust prices to attract less or more money to particular outcomes – e.g. they may want to limit their liability on an outcome they already face a big payout on if it comes through, or they may want to attract more money to different outcome(s) to one(s) they already have taken a lot of money on to guarantee a profit or minimise potential losses. How do bookmakers use overround to try and make profits?

As an example, here are the odds a bookmaker was offering, at the time of writing, on an upcoming Rugby Union match.… Read the rest

• Wisdom of the Crowd refers to the phenomenon that a large number of individuals in a group, will usually be able to make better decisions than any individual in that group.
• For example, at a funfair say their was a big jar with an unknown amount of marbles. People were asked to guess the number of marbles (with the closest getting a prize). If you took all the guesses and averaged them (provided there was a sufficient number of people in the group) it would usually come close to the actual number of marbles in the jar. Obviously, the more people who participated the closer to the actual number you would get.
• This happens, because individual noise is filtered out.
• In the case of betting odds, Wisdom of the Crowd also has an effect as bookmakers are forced to lower prices getting a lot of betting action (and increase prices not getting a lot). So, highly backed outcomes get their prices lowered, and less well back outcomes get their prices increased.
• However, for Wisdom of the Crowd to work people have to be making rational and independent decisions. In the case, of marbles in the jar at the funfair this may be the case.

Numerous websites and software tools have popped up which claim to allow you to spot guaranteed profitable betting opportunities, by taking advantage of the differing prices on outcomes in the same market between different bookmakers. We explained how you could start to find the best value markets at your favourite bookmaker. This involves working out the overround on a particular market. The lower the overround the better. However, these websites and tools take this a step further, and claim to be able to find opportunities (by placing bets at multiple bookmakers, on different outcomes in the same market) when there will effectively be no overround, and in fact the book will be less than 100%. This is called arbitrage betting. We strongly recommend you avoid arbitrage betting. Although, the opportunities they spot will be real (if you are using a reputable service), we still recommend you avoid this form of betting. There is usually a fee involved to use these services, and even though the opportunities to make a profit might be there in theory, in practice they are difficult to profit from.

Why avoid arbitrage betting? Your account may be closed, or bets revoked.

• Bookmakers generally hate arbitrage betting.

If you keep placing bets on outcomes of events, just because you fancy teams/players to win (Gut Instinct), without considering the odds fully then you will likely be losing money in the long run. Value betting involves independently considering if the odds offered are better than the true probability of the outcome happening, and only placing bets if that is the case. Let’s start our Why is Value Betting superior to using Gut Instinct? article off with an example:

Let’s say you are considering placing a bet in an event in which there are two outcomes only, e.g. the final of a competition where either team/player A wins, or team/player B wins (no draws possible). You need to calculate the true probabilities of the outcomes. This requires taking into account a lot of factors (prior results, injuries, officials, form etc. – variables will depend on what event you are betting on), and coming up with a statistical model (which may require, amongst other things weighting the factors).

Let’s say you calculate A wins two-thirds of the time, and B wins one-third of the time:
Two-thirds of the time is the same as odds of 1/2*, i.e. for every 1 time they don’t win, they will win 2 times.… Read the rest

When you place a bet on a horse race, instead of taking the fixed odds price on offer you might be able to place a bet at an unspecified Starting Price. Sometimes for future races, which haven’t been priced up by your selected bookmaker, you can only place a bet at the Starting Price (SP).

When you place a bet at the SP, you do not know in advance what odds you are getting! So, why on earth would you want to take this option? Odds on horses can fluctuate, in the build up to the race. When the race start time comes closer, it is clearer what the conditions will be like (e.g. is the ground heavy or soft, will it be raining or really hot at the time of the race), if any other horses have withdrawn, and if the horse has any issues etc. Odds can thus fluctuate for many reasons, including the amount being bet on a horse. So, with lots of money coming in, the price is likely to go down and vice-versa. In the UK, a panel decides the starting price (it should be the same regardless of which bookmaker you use), based on how they view the fluctuations of prices.… Read the rest

Diligent sports betting bankroll management can be the difference between winning sports bettors, and those who are destined to lose all their money.

Here’s an example:

• Let’s say that you have £1,000 to gamble with in total in your sports betting account with a bookmaker, but cannot replenish this money if you lose.
• Let’s say you were betting on an event with only two possible outcomes, and the bookmaker was offering 6/5 on outcome 1, and 1/2 on outcome 2 (this is a made up example).
• Let’s say according to your value bet calculations, you thought the true odds of each outcome was 1/1 – i.e. there is a 50% chance of outcome 1, and a 50% chance of outcome 2.
• Of course you would want to bet on outcome 1, as you are getting better odds than required. You would never bet on outcome 2, as you are getting worse odds than required.
• If you bet £1,000 on outcome 1, there’s nothing intrinsically wrong with the bet in terms of value. After all, you will be making £1,200 profit if outcome 1 happens!
• However, what if outcome 2 happens? 50% of the time it will, and you will lose your stake of £1,000.

We have already explained how to understand the Fractional Odds system used by UK bookmakers, as well as the popular Decimal Odds system. For completeness, we thought we would also explain the ins and outs of Moneyline Odds. This system is popular in the USA, and as such we will use dollars in the examples below (but of course the same principles apply whatever the currency). To understand Moneyline Odds, first look at if the odds are positive or negative. Then, look at the odds. Moneyline Odds are expressed per $100 staked (although of course, you should be able to bet any amount, subject to minimums or maximums).

• POSITIVE Moneyline Odds show how much profit you will get if your bet wins, for every $100 staked (if you win you will get back your original stake too).
• NEGATIVE Moneyline Odds show how much you will have to stake, to get $100 profit if your bet wins (if you win you will get back your original stake too).

Let’s look at two actual examples:

• +500: this means for every $100 bet, $500 profit will be paid if your bet wins (i.e. if your bet wins they will return you original stake of $100, and pay you another $500).

Having understood the ins and outs of Fractional Odds (traditionally used by UK bookmakers), we think it will be a useful exercise for you to understand the Decimal Odds system as well. Decimal Odds show how many times your original stake (INCLUDING your original stake) you will get back if your bet wins. Obviously, this number should always be more than 1.0 as you should always get back your original stake if you win, plus some profit. Compare that to Fractional Odds which only show the potential profit you will get back if you win (of course regardless of the odds system, you will always get your original stake back if you win).

Let’s look at some Decimal Odds examples:
6.0 – for every £1 bet you will get £6 back, if your bet wins (i.e. you make £5 profit, per £1 staked). 5/1 (Fractional Odds), and 6.0 (Decimal Odds) are equivalent.
1.2 – for every £1 bet you will get £1.20 back, if your bet wins (i.e. you make £0.20 profit, per £1 staked). 1/5 (Fractional Odds), and 1.2 (Decimal Odds) are equivalent.

Fractional Odds are popular in the UK & Ireland. Decimal Odds are popular in Continental Europe, Australia, New Zealand, and Canada.… Read the rest