Handicapping The Sports Betting Market



When it comes to handicapping the sports betting market, only the most serious, or sharp bettors, engage in this type of activity. Handicapping the market involves shopping for the best odds among dozens of sports betting websites in an attempt to sift out wagers with the highest, or positive, expected value. Handicapping the market is a difficult topic to teach as the practice often comes with years of experience, resulting in a process that is very much intuitive. However, in this article, we’ll provide you with some tips and strategies on how to handicap the sports betting market.

Efficient Markets

When it comes to the stock markets, you’ve typically heard of the use of the term “efficient markets”. The same applies to sports betting as well. The general understanding when it comes to the sports betting market (the stock market as well) is the fact that all prices and lines reflect the true underlying odds of winning or losing. As a result, it’s impossible to gain an edge. In the past, many bookmakers were independent. However, oddsmakers in Las Vegas calculate the prices and lines, with bookmakers following along. With all the resources at the disposal of oddsmakers, it’s no surprise that it’s extremely difficult to beat out these guys. Fading the general public also used to be a sound tactic but in today’s sports betting environment, this is no longer the case. Additionally, with the plethora of odds tracker sites, it’s near impossible to find lines that offer positive expected value (+EV odds). What this means is that if one site offers a moneyline favorite at -275 and another site offers the corresponding moneyline underdog at +280, this represents a +EV bet and as a result, a hedging opportunity will arise, resulting in a guaranteed-profit arbitrage.

How Bookmaking Works

When sports betting lines are first released, they’re considered rough and have smaller betting limits. From the perspective of the bookmaker, their goal is to sharpen the odds by taking smaller bets. As more and more small bets are placed, the bookmaker will adjust the lines until they find a line where lopsided action ceases. From then on, betting limits are increased by making additional adjustments. When game time approaches, the bookmakers will have arrived at a price where the largest and most successful sports bettors in the world will no longer have an interest in betting either side. This signifies efficient markets, meaning that if we removed the juice or vig, the betting odds would represent the actual probabilities of each side winning.

How To Remove Vig Or Juice

The correct way to remove the vig or juice from a moneyline is to calculate the implied probability of each side. Implied probability refers to the winning percentage that you must achieve in order to simply break even. For example, for a side that’s favored to win the game with a -500 moneyline, this side is obviously a heavy favorite. As a result, in order to simply break even, had you taken a lot of these games at -500, you’ll need to achieve a winning percentage of .833 (take the inverse of the decimal odds of -500, which is 1.20). If you’re able to achieve a winning percentage above .833, you’ll profit over the long-run. On the other hand, if you’re not able to achieve this winning percentage, you’ll lose money over the long-run – simple as that.