The Truth About Sports Betting
The attraction of applying skill and relevant knowledge to win at sports betting is understandable against the alternatives of casinos and slots, yet the full story isn't quite so black and white.
We'll provide clarity, to help you find out the whole truth when it comes to betting on sports, including:
- How luck still plays a large part in the outcome of sports events.
- The effect that a sportbook's margin has on your sport wagers, particularly when placing accumulators.
- Examining the theories and myths that surround sports betting, to help you separate the fact from the fiction, and stay in control your hobby.
The Presence of Luck in Sports Betting
Placing a fun bet to spice up the big football game, or applying your knowledge to win at sports betting, can both be thrilling experiences. The appeal when compared with playing slots is stark, as your destiny is no longer based solely on luck.
However, it’s important to appreciate that luck still plays a significant role in the outcome of sports events. A ball can take an unexpected bounce, an official can make a controversial call, and a freak injury or inclement weather can sink even the most well-reasoned sports bet.
The Correlation between Skill and Results in Sport
Michael Mauboussin, author of The Success Equation, investigated the correlation between skill and results across a variety of sports.
Lottery tickets, roulette games and slots machines rely entirely on luck, as you’d imagine. For all the strategies you can employ, there’s no way to create an edge against the casino. The presence of luck gradually lessens as you move across different sports, yet it’s always present to some degree. It’s important to keep this in mind when betting, to avoid the likelihood of overconfidence creeping in, and to stand against the perception that a ‘sure thing’ ever exists when it comes to sports betting.
The Impact of Luck in Sports Betting
You may have watched sports events where one player or team dominates throughout, before somehow contriving to lose. The final score tells us little about the impact of luck on the game, but a metric called expected goals (xG) can be used to tackle the problem.
The xG analyses the quality of chances that take place in a soccer match, with each shot attributed a probability of becoming a goal.
The chart below focuses on the finishing positions in the 2019/20 English Premier League soccer season. On the left, the positions are based on expected goals. On the right, we can see the actual final positions.
Premier League - Expected and Final Positions
While there are similarities – for example, the same four teams occupy the top four positions in both cases – we also have different winners, and a different team at the bottom of the table. This demonstrates how a good bet doesn’t always win. It should act as a reminder to keep your staking plan in check and under control.
The Effect of Margin on Sports Bets
Margin, vig, juice, overround and house edge are all terms used to define the profit margin that sportsbooks and bookmakers bake in when offering odds. Rather than having the opportunity to double your money in a heads or tails type scenario, you will typically win between 2-10% less than that.
Having to bet when up against a margin may sound unfair. However, if no such edge existed, a sportsbook would do no better than breaking even in the long-run, and would therefore be unable to operate.
Accumulator Bets
Accumulators – wagers made up of multiple selections in a single bet – are incredibly popular amongst sports bettors. This is predominantly due to the possibility of winning a significant amount of money from a relatively small wager.
Sportsbooks are more than happy to take on these wagers though, and one of the key reasons relates to the margin. For each selection placed, the house edge increases, and it does so at a compounded rate.
The table below shows the effect on the total margin as the number of selections in the accumulator increases, assuming a 3% edge is applied to each selection.
| Total selections in accumulator | House edge faced by bettor (%) |
|---|---|
1 | 3.0 |
2 | 6.1 |
3 | 9.3 |
4 | 12.6 |
5 | 15.9 |
6 | 19.4 |
7 | 23.0 |
8 | 26.7 |
If you find accumulators are the most entertaining form of sports wager, and you’re betting within your means, there’s no reason to change your betting habits. But there should be a realization and acceptance that achieving profit is far tougher when faced with a margin of 26% than the 3% you’d often be up against when wagering on the outcome of a single event.
The Theories and Realities of Sports Wagering
By now, you should already have a clear idea of the impact that luck and a sportsbook’s margin both have, but here we’ll delve deeper into some other stories that you may have heard.
The Theory
Betting tips are often written by former sportspersons, who have played the sport that they’re talking or writing about for years. Others feel the need to look through reams of stats, before suggesting or placing a bet.
The Reality
Firstly, there’s no evidence that playing a sport, professionally or otherwise, puts you at an advantage when it comes to betting on it. Former sportspeople are regularly commissioned to give their opinions, but they often have biases, conscious or otherwise, which can easily impact their thought process.
Watching sports events neutrally will generally provide you with enough insight to confidently place a bet.
The Theory
There are numerous sports tipsters, particularly on social media, that talk up their tipping history. If they’ve won their last 10 bets, surely it is worthwhile to follow their suggestions.
The Reality
In most cases, it won’t pay to blindly follow a tipster. Many will tip heavy favorites with the eventual intention of enticing people in with a lengthy winning streak. In fact, a long run of winning bets doesn’t tell the whole story.
The return on investment (ROI) and overall profit or loss figure provides a far better indication of whether a tipster is worth paying attention to. Even when this looks promising, it’s important to remember that strong past performance doesn’t guarantee similar outcomes in the future.
The Theory
They say form is temporary and class is permanent, so it follows that ignoring short-term dips in the form of a player or team can pay dividends.
The Reality
Gambler’s fallacy is the misplaced belief that, if a particular event occurs less frequently than normal during the past, it is less likely to happen in the future. This thinking can be applied to many scenarios. Throwing consecutive sixes with a dice doesn’t make it any less, or indeed more, likely to happen again the next time. Similarly, expecting a player to regain their form for no apparent reason other than it being ‘due’ makes little sense from a mathematical perspective.
Of course, it can be fun predicting that a player might suddenly find form and extra motivation when suddenly up against a former team but expecting to make long-term profit by betting on this basis is unrealistic.
The Theory
There are opposing theories when it comes to betting on either favorites or outsiders. One school of thought is that teams are favorites for a reason, so it should pay to bet on them. Opponents would argue that sport is unpredictable and so taking a contrarian view can be beneficial.
The Reality
There is some credence to both sides of this argument, but ultimately no hard and fast rule can always be applied to guarantee winning bets. Favorites do win regularly, but there’s never a ‘sure thing’ when it comes to sports betting. Being contrarian by taking on the favorite can pay, but looking at every bet you place in isolation is the best approach here.
The Theory
In a competitive market, bookmakers regularly offer promotions to attract customers. Taking advantage of these can be a profitable experience in the long-run.
The Reality
Sportsbook promotions are the equivalent of a shop putting their best offers in the window. The idea is to entice potential customers in, in the hope of winning their loyalty and encouraging them to also spend money on products which aren’t on sale.
It’s advisable to take a safety-first approach when it comes to sports promotions. If you understand the intricacies of the terms and conditions and have the discipline to only place the bets that you want to, there’s nothing wrong with embracing promotions. Be wary if something sounds too good to be true though. A free bet may have rollover requirements attached to it. Our casino reality check page discusses this in more detail.
Keeping your Sports Betting in Check
Staying in control of your sports betting hobby is key to it remaining an enjoyable source of entertainment. Here are a few ideas to help you avoid it getting out of hand.
Track your Bets and Analyze Past Performance
Keeping a log of your previous betting history is one way to stay on top of your betting habits. Many sportsbooks will have this information readily available when you log in to your account. Specific areas that might enlighten you are:
- Analyzing preferred markets: are there certain sports or types of bets that you enjoy placing or tend to do better at?
- Investigating your betting style and frequency: is there a time or day where your bets are more impulsive, leaving you wishing you’d taken a watching brief?
- Looking into your betting stakes: does the amount you wager vary, based on either your confidence that a bet will win, or the results of your previous bets?
Uncovering trends of this kind can be a simple yet effective way to increase your profitability, and ultimately your enjoyment too.
Don't Set Targets
Setting targets can be dangerous for even the most experienced bettors. Sport is seasonal, so it’s natural to expect peaks and troughs in terms of the quantity and quality of attractive wagering opportunities. Giving yourself a target can result in placing bets that you hadn’t originally intended. It can also put yourself under pressure to chase losses. Try to take each bet in isolation to avoid placing wagers you might regret later.
Use Responsible Gambling Tools
An increasing number of sportsbooks and casinos have introduced responsible gambling tools to ensure their customers are betting for the right reasons. UK bookmaker Skybet claim that over half a million of their customers already set a deposit limit, so you shouldn’t feel uncomfortable adding to that number.
Here’s a summary of some of the available tools:
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Deposit Limits
This facility allows customers to limit the size of their deposits over a period of a day or a month.
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Reality Check
This gives you the ability to receive an onscreen notification after you have been playing on a betting site for a predetermined length of time.
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Cool Off Periods
This provides the opportunity to block yourself from accessing a sportsbook for a short period of time, from a day through to a month.
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Self-Exclusion
This lets customers prevent themselves from accessing their betting account for a longer period, typically between six months and five years.
Sports Wagering FAQ
Can you really make money sports betting?
Yes, it’s certainly possible to make money by betting on sports. However, doing so over a long period requires discipline, knowledge, and effort, not to mention a slice of good fortune, so there are relatively few people who are able to make a living in this way.
Is sports betting rigged?
Although there have been betting scandals over the years, it’s safe to say sports betting isn’t rigged. Sportsbooks do apply a margin or house edge to the events they accept bets on though, so it’s more likely than not that you’ll lose money in the long-run.
Is sports betting illegal in the US?
Sports betting rules vary depending on the state you’re in. Our best advice would be to investigate the specific rules and regulations relating to where you’re located.
Is it legal to bet on eSports?
Yes, eSports are classified as fantasy sports contests rather than sports betting, so it’s legal to bet on eSports across most US states. In countries like the UK, betting on eSports is becoming increasingly popular, so sportsbooks are actively increasing their offerings to cater for the increase in demand.
Is sports betting skill or luck?
Sports betting involves a combination of both skill and luck. It is perfectly possible to win a single bet by picking an outcome at random and hoping for the best, as you might do with casino games. However, you must possess a level of skill and knowledge to expect to win on sports betting in the long-term.
How does the house always win in sports betting?
In the long-term, the house will win in sports betting because they apply a house edge on all bets that are placed. However, it’s possible for the house to lose in the short-term and on individual markets. This happens when a large majority of bettors back a very strong favorite, or alternatively if an individual is lucky enough to scoop a big win from an ambitious accumulator.
What is the most profitable sport to bet on?
Research has shown NBA and NFL to be the most profitable sports to bet on. Every bettor has a different level of knowledge though, so it would be advisable to focus on the sports that you’re most familiar with.
Is it a good idea to place accumulator bets?
Accumulators are one of the most entertaining form of bets, so placing them can be a good idea if you’re betting for fun with small stakes. Combining events in an accumulator does result in compounded sportsbook margins though, so steer clear of them if you’re striving to turn a long-term profit.
