, over the years, have traditionally thought of sportsbooks as an amenity to offer to their customers as opposed to a "real way" to make money. They cap the bets made on traditional over/unders and to people who consistently win in sports gambling (known as 'sharps'). The casinos believe that sports gambling is beatable by a select few and just hope that the losses of the masses can wash out the gains of the few. As venues move to live sports gambling markets, that also might mean more exploitable bets for sharps.
But, back up a step. The obvious question is: if sports gambling is beatable, how does one stay ahead of the market/line-setters?
Why the Dealer Always Wins
First, a quick word about how lines are set and money is paid out on various outcomes.
Lines are set to hopefully establish even money on each side, not necessarily to predict the winner. The sportsbooks then make money no matter which side wins by the small additional odds they charge (called the ‘vig’ or ‘juice’) for an equal payoff.
For example, the Patriots (-3.5) play the Giants (and, unfortunately, lose). This means that the Patriots were laying 3.5 points or were favored by 3.5 points. A bet on the Patriots paid off only if they won by 4 or more. A bet on the Giants won if the Giants won or lost by 3 points or less (they won by 4). Each of these went off at -110, meaning a bet of $110 only won $100. So if they got an even amount of bets on each side, the books won $10 off each losing bettor.
That is pretty much the essence of making money in keeping a sportsbook.
But, how does a gambler make money off of a sportsbook?
That is a bit more difficult and many books have been written (and fortunes lost) attempting to gain this recipe. This article doesn’t deal with how to win in sports betting, but deals with an even more interesting development in sports betting which might be exploitable: live sports gambling markets.
The M Resorts Spa and Casino currently encourages sports betting. And, unlike every other sports book in town, they offer live odds on many events. This could be a strikeout on a single at-bat, an interception on a specific drive, the number of points in a certain quarter in a basketball game, etc, etc.
They are able to offer this through advanced algorithms that can determine the odds of every particular event in real time. The sportsbook itself currently feels that they can make money off of the small amounts of vig they gain from each trade and encourage people to try to beat them.
As mentioned above, if the odds are correct and 50% of the bets come in on each side, then bookmakers always win. The key is to always have the same money laid on each side, and that is where the complex math comes in.
Live Sports Gambling Markets: New Avenues for Betting
This amount of liquidity in gambling allows interesting propositions for gamblers, too. For example, if you bet on a certain basketball player to score 10 points in a quarter at odds of 3:1 and 6 minutes into the quarter when currently has 8 points, you can then bet that he will only score 8 points. The odds at the beginning of the quarter may have been short, such as 1.5:1, but are now trading off at 4:1!
Betting this will guarantee that you will make money with another bucket, either at 3:1 or 4:1 (so long as they don’t get 9). This allows the accurate timing of certain bets, the ability to leverage one’s own mistakes and mitigate risks. In this way, much more advanced betting methods can develop!
This is very new technology, and Cantor Gaming feels that they can increase revenue twenty-fold in a few years, which will give them even more accurate live price setting (due to accumulated history of past betting). All of this is very exciting to a math nerd like myself who believes that markets can exist in, well... everything.