Apr 24, 2017 Matched betting is one of the best ways to make money online, and at OddsMonkey we have all the tools and resources you need to get started. Find out how you can easily turn bookmaker offers into tax free profits today. How to Make Money From Your Betting Tips? Sports betting is big business with billions being wagered each year with online bookmakers. The advance of websites like Betfair has revolutionised the betting. Over the course of a sport betting season you can win yourself a lot of money from shopping the lines that would otherwise would not be one. Line shopping is definitely one of the best sports betting strategies used by winning sports bettors. To see a list of sportsbooks we recommend signing up for visit our Online Betting Sites section.

Most people who want to place bets on sports are fans to begin with. It isn’t unheard of for a gambler to place some sports bets, especially during big games like the Super Bowl or the NCAA basketball Final Four, but for the most part, sports bettors are sports fans looking to use their knowledge of a game or of a game’s players to earn a little extra cash. Being a fan of a particular sport, a team, a college or professional squad—these are all precursors to placing sports bet. Sports betting is also a way for a fan to get in on the action of the game, with something more than self-respect at stake.

All gambling is mathematics, even games of chance. If you understand the math behind the game, you understand the game and can give yourself an advantage. For many games, like penny slots or poorly placed roulette bets, are so bad that smart bettors earn their advantage by avoiding them altogether. In sports betting, the math is more complicated. Depending on your favorite sport, you may need to think about things like bye weeks, underdogs, quarterback ratings, and injuries with the same fervor other connoisseurs reserve for fancy winces.

So how difficult is sports betting math? The math behind placing a winning bet is fairly complicated, but the way to stay ahead of the bookmaker is rather straightforward. If you collect on 52.4% of your bets, you’ll break even. We’ll have more details on that number later, including why it takes more than 50% wins to break even, but first some general knowledge about sports gambling and the numbers behind it.

Sports Betting Basics

The easiest way to demonstrate the math behind a sports bet is to make up an example. Let’s say you and your buddy walk into a casino, each with $200 burning a hole in your pocket. There’s a big game on tonight, the Cowboys and the Redskins, so you wander into the sportsbook to check up on the latest news about the game. While you’re sitting there, you see the wagering board, with some funny numbers on it. It looks like this:

• 428 Cowboys +175
• 429 Redskins -4 -200 38

Some of this is easy enough to read. The Redskins -4 means the Redskins are favored to win and must do so by at least 5 points for a bet on the ‘Skins to pay out. The next number (-200) is the moneyline, in this case the Redskins are a 2/1 favorite. The last number (38) is the total, the over/under of the expected number of points scored in the game.

More on Placing Sports Bets

Look at that over/under number, in this case 38. If you or your buddy thinks this is going to be a particularly high or low scoring game, based on your knowledge of the team’s offenses and defenses, or information about a hurt player or bad playing conditions, you can place a wager on the total of points scored.

So how is a guy supposed to know how to literally lay down a sports bet? You need to know three things:

#1 – the type of bet you want to make
#2 – the number of the corresponding team you have chosen and
#3 – the amount you wish to wager

Knowing all that beforehand gives the ticket writer the details he needs to write the ticket without having to bend over backwards to process your bet.

Tipping and Sports Betting

We haven’t even gotten to the meat of the sports math yet, and we’re already talking about tipping the staff behind the window? Yep. Here’s why.

If you place two $100 bets, and you win, you’ll collect $440. You should consider leaving a tip around five percent of your winnings. Yes, that’s a $22 tip, but you just made a huge win, and surely you can spring for a twenty-spot for the guy who helped you win it. If you tip around the five percent mark regularly, when you win, you’re way more likely to get free drinks, which is about all you’re going to get comp-wise at the sportsbook.

So, back to the basic math of sports betting. You and your buddy, after much deliberation, decide to each place a $100 bet on your favorite team. What now?

To bet on the Redskins using the point spread, your bet is called “laying the points.” For your bet to pay off, the ‘Skins have to win by five or more to cover the spread. Remember, if the ‘Skins win by exactly four, the game is a push, and both sides recoup their bet. Another alternative is called “taking the points” with the Cowboys. That means the Cowboys have to lose by three or less for your bet to win, or if the Cowboys win outright. So you and your buddy go up to place your $100 bet, and you find out that the standard straight bet at any bookie pays 11/10. That means you have to bet $110 if you want to win $100. You and your buddy pay the bookie $110 and sit down with drinks to watch your bets come in.

These are deceptively simple bets. Deceptively because they make it look like the outcome of the football game is like the outcome of picking marbles out of a bag. Put one black marble and two white marbles in a bag, pull one out at random, and there’s your football game. After all, the odds are the same: 2/1 for white.

But we, as sports fans, know that the mathematics of a sporting event is much more complex. Sports bettors deeply involved in their hobby will subscribe to weather bulletins from major cities that take part in their sport, making huge wagering decisions based on a few mph of wind in one direction or another. Then there’s the unknown—does a player get hurt in the first quarter? Does weather become a factor? Is a particular player “in the zone?”

How Do Bookies Make a Profit?

Just as we finish ruminating on the concept of the difficult math at play in the background of major sporting events, we’re going to turn right back towards the simpler side of sports betting. Bookies make a profit because of vigorish. What’s vigorish?

Look at the above example again. You and your buddy each paid $10 to the bookie to place your bet. That’s what the standard 11/10 odds in sports betting are all about. You bet the Cowboys and your buddy bet the Redskins, a total of $220 bet. The sportsbook has to pay back $210 to the winner, leaving a nice $10 profit no matter what happens on the football field. That $10 built-in profit is called the vigorish, and it’s the final monkey wrench in the gears of sports betting.

Obviously, sportsbooks are going to take more than two bets on any game, but this example is for simplicity’s sake. Looking at the total number of bets on different games over the course of a week and adjusting the moneyline and other numbers is another way the bookie makes a profit. Adjusting the odds a tiny percentage point in either direction will affect the balance of beats and make the book more likely to turn a profit no matter what.

Essentially, a bookie is a person who holds on to money from bettors then pays them if they win and keeps their money if they don’t. That’s what the job is boiled down to its essence.

When a bookie sets odds for games, he will build what bookies call an “over round” into his set of odds. Another slang term used for this formula is “the juice.” For the sake of simplicity, let’s look at a boxing match where both contenders are equally talented, of equal stature, etc. Since they both have an equal chance of winning, a casual bet may be even money. You put $20 on one guy; your friend puts $20 on the other. Whichever fighter wins awards the bettor with the total of $40.

Bookies don’t offer even money like friends in a casual betting situation. In the above example, with two evenly matched boxers, a smart bookie will offer 5/6 odds for each. That way, a $10 winning bet would only return $8.30 plus your stake. What does this do for the bookmaker? He can float an equal amount of money on both fighters, winning no matter which fighter actually wins. If they take $1,000 worth of bets on one boxer and $1,000 on the other, the bookie would take in $1,000 but only have to pay out $830, for a guaranteed $170 profit regardless of the outcome.

Bookies look at the weight of their books all the time and adjust odds and other factors to make sure their books balance. Though it isn’t possible to completely balance a book, bookies that go too far out on one side run the risk of losing money, and losing money in gambling is the fastest way to find yourself in another industry. All of these factors are why bookies generally root for the underdog—too many favorites winning in a sport with a short season (such as the NFL) can cause a bookmaker to lose money, while a bunch of upsets (like you generally see in college football) is a guaranteed profit for the bookmaker.

The short answer here is that bookies making money has nothing at all to do with your betting. It is almost unheard of for a single customer to be allowed to place enough bets to sink a single book all on his own. High rollers in sports betting get special privileges in terms of their maximum bet size, but these privileges often change with the bettor’s luck—maximums get raised after the bettor sees big losses and decreased (sharply) when the bettor starts to get lucky.

In short, a sportsbook’s profits aren’t necessarily impacted directly by the way an individual bet is called. Unlike casino games or slot machines, where it’s you against the house, sports bettors fuel the bookmaker’s business and only rarely is an individual bettor betting against the bookie.

Sports Betting Odds

Remember at the beginning when we talked about the magic number necessary to guarantee a break-even week in sports betting? If you read enough about sports betting, you’ll hear this number repeated often: 52.4%. If a bettor can win 52.4% of his bets, he’ll break even. Where does that number come from?

When betting the spread, you get odds of -110. Sometimes, sportsbooks will offer a -105 line as a promotion or to welcome new business. But for the most part, if you’re betting the spread, you’re getting -110.

We draw that 52.4% break even number right out of the odds. -110 is equivalent to 11/10. That means if you bet 21 games, you’d have to win eleven of them and lose ten of them to break completely even. Even at -105, you’d still have to win an astounding 51.2% of the time just to break even.

If you don’t trust the basic math behind this break-even principle, look at another real-world example. Let’s say you get really into sports betting after your Cowboys cream the Redskins and you go home with a nice fat wallet. You then bet on the next 10 Cowboys games, winning six times and losing four times.

That 60% betting record (with the odds of -110 that is traditional for against the spread bets in football) will leave you with a profit of $160. Think about it—your $600 profit from your 6 winning bets minus the $440 you lost on losing bets leaves $160. It took you $1,100 to win $160, meaning you have to bet $6.87 to win $1 on average. So you see the small differences between a 52.4% winning rate and a 60% winning rate—inside those 7.3 percentage points lies hundreds of dollars in profit.

Now imagine instead that you lost one of those six winning bets, leaving you with a 50% betting record. You spent a total of $1,100, won $500, and lost $550. That means overall your 50% record drained your wallet by $50. That’s where the vigorish will get you. Not even winning half the time is good enough to break even in sports betting.

Professional Sports Bettors

Believe it or not, some people really do bet on sports for a living. Maybe they work part time at a sportsbook or in some other marginal job in the casino industry, but there is a group of gamblers who bet on sports for their life’s work. With all the math swirling around in our heads after the last bit of the article, it’s hard to imagine anyone wanting to do this for a living.

If you know that a 52.4% record will mean you break even, the simplest way to turn sports betting into a career is to bet enough so that a 53% winning record will bring in the kind of money you want to make.

Another example. After your successful Cowboys experiment, you decide to invest $10,000 in sports gambling over the first four months of the following football season. That $10,000 is set aside to win or lose in sportsbooks.

You plan on betting on 160 games during your investment period. You dream of a 55% winning record because your win-loss with a 55% winning record would give you an 88-72 record. That’s an expected profit of +8.8 units. How did we get to that number? To calculate your units, subtract the total of your losses (multiplied by 1.1 to include the vig) from your wins and you’ll get your unit profit.

Placing $460 bets on each of these games, a number pulled from some quick and dirty math about how much you could afford to bet in a single week’s NFL play without blowing your bankroll, would result in a $4,048 profit if you maintain that 55% winning record. Turning $10,000 into $14,048 in just four months is an investment return of 40.48%. I dare you to ask your bank for that kind of return on your savings account.

But that’s all assuming you can pick the winner 55% of the time. Do your research, look into the records of professional sports gamblers. 55%, while not impossible, would place you among the elite sports bettors in the country, if not the world.

Professional sports bettors have to worry about variance more than any other type of gambler. Working against the forces of variance means managing your bankroll over the course of the season to avoid the negative possibilities that could totally empty your wagering account. Professional sports bettors have the time and resources necessary to calculate these variances, and there are even a few pieces of software out there that can help you figure out your ideal bet in the face of negative variance. But the bottom line is that professional sports bettors would dream of having a 55% winning record, simply because it guarantees you’re beating the house.

Pro bettors make their money on bets that sportsbooks offer that give them even the slightest betting advantage. The key to becoming a profitable sports bettor is being able to find advantages, opportunities where the line a book is offering is vulnerable.

This is why many long-term sports bettors are math freaks. Good sports bettors understand statistics, particularly what are called inferential statistics, though any higher math will help when it comes time to place a bet.

Here is what a professional baseball bettor might do in his head. After looking over statistics from MLB (kept religiously by all sorts of bloggers, data archives, and magazines) between the years 2000-2010, he notices a particular statistic pop out. For example: when the home team starts a left-handed pitcher the day after a loss, that team wins 59% of the time. Good sports bettors can do this sort of math in their head or very quickly on paper. From that bit of information comes a new betting theory—look for game situations that mirror the above example and bet on them. That means he’ll only bet games where the home team starts a left-handed pitcher the day after a loss. Does he just jump in and start betting based on this back of the napkin math? No way. More statistical analysis is required—he may find that this was a fluke for that particular decade and isn’t a trustworthy statistics, or he may find an even more advantageous bet based on his original theory.

Pro sports bettors also keep near-obsessive records of their bets. Obviously, no edge in sports betting lasts longer than a single game. Taking proper records will also help you test theories, like the above one about left-handed pitchers and losses. Without taking good records, no sports bettor’s bankroll will last very long.

What Is a Good Record for Sports Bettors

So, at the end of the day, what could you call a “good” record for a sports bettor? Most casual gamblers looking into sports betting see a pro advertising his 1100-900 record and shake their head a little. How could such an abysmal record be something to be proud of? That’s a 55% winning percentage, and it indicates to those in the know that this bettor is actually turning a profit placing bets on sports.

A good record for a sports bettor is any record equal to or larger than 52.4%, because that number or anything higher means you’re not losing money. A 53% winning record, while not impressive on paper, means you’re actually beating the sportsbook and putting money back in your pocket. Ask your friends that play the slots or play online poker how often they end up putting money back in their pocket.

A -110 wager, standard for spread bets in the NFL, gives the house a built-in advantage of 10%. It means that even if you do win, and you line up to collect your $100, some sucker behind you just spent $10 to hand the casino $100.

A good record for sports bettors is any record that ensures they at least break-even. If you bet 16 games this NFL season and you won 9 and lost 7, you probably made money. And taking money away from a casino is always something to be proud of.

Other Advanced Sports Betting Strategy Articles:
» Future Betting Strategy
» NFL Bye Week Betting Strategy
» Parlay Betting Strategy

Sports Betting Break Even Video:

In the video above I go over the break even % for sports betting, and we take a look at the difference between hitting 52% and 53%. I also quickly show the amounts of profits you can expect if you can hit 55% consistently.

The odds you get at a bookmaker represent the chance of your bet winning. And sometimes, just sometimes, the bookies get it wrong allowing smart punters to get great value. This is the essence of value betting.

Value betting was the final and most profitable step of my eight-year career as a professional gambler. I started with Matched Betting, moved to Casino Bagging, then on to Sports Arbitrage and finally to value betting.

Warning: Before we start let me be very clear. This is an advanced guide. Value betting is profitable and mathematically sound. But it is not risk-free. Even when done right you can be unlucky and lose money. If you are new to profitable gambling start with matched betting instead. It is much easier and risk-free. And never use money you can’t afford to lose.

The first part of this guide will be on explaining what exactly is value betting. The second part is on the different types and how to find value.

Contents

• 1 What Is Value Betting?
• 2 Two Types Of Value Betting
• 3 Is Value Betting For You?

What Is Value Betting?

Very simply, value betting is placing bets when the bookmaker has priced their odds too cheaply. This happens when the odds on offer reflect a lower probability of the event happening than the true probability. The bookie has priced their odds cheaply, leaving an opportunity that will make the bettor money in the long run.

How Do Odds Work?

Let me explain in more detail. The odds you see at a bookmaker represent the probability of the outcome happening. The bookie wants to make money so will calculate the probability and then offers odds that are slightly worse. This is the essence of running a bookie – decide what you think the chance of the event happening is and then price your odds so you will make money. If you do that over every outcome of an event you have “made a book”.

Here are some odds on a tennis match at Ladbrokes:

Note: for fractional odds (like above) you can work out the implied probability by: denominator / (denominator + numerator) * 100. For decimal odds (not shown but also a common way to bet) you just take the inverse and multiply by 100.

In the tennis match above there are only two possible outcomes so the probability should add up to 100%. But it doesn’t, the bookmaker has created odds that add up 107.6%. This percent above 100% is known as the bookies overround and is the ‘book’. It is how they make their money.

When Is There A Value Bet?

If we knew that the true probability of Ulises Branch winning was higher than 47.6%, then betting on him at odds of 11/10 would now be a value bet. Over the long term, we would make money taking such bets.

Still don’t quite get it? Ok let’s go for a very simple example.

Let’s say we are betting on a coin flip. The true odds of heads coming up is 50%. So the true odds are evens (1/1 in fractional odds).

If someone was stupid enough to offer us 2/1 odds on heads coming up I would take that bet all day every day.

If we played 20 games and heads came up 10 times, and tails came up 10 times I would win £20 and lose £10. Leaving me with £10 profit.

A value bettor’s job is to work out the true probability of an event happening. And then find bookmakers who have got it wrong.

But Beware Of Variance

In the above example of the coin flip, I might get unlucky. Tails could come up and I would lose £1. But that doesn’t mean it was a bad bet. In fact it was a very good bet and I would take it again. And the more I took that bet the more likely I will make money overall.

Here are my real life value betting results over a 12 month period. This is using the second type of value betting that you will read about later.

The light blue line represents daily profit. And the dark blue is the 2-week average. I was placing hundreds of bets a day and there were some days where I got unlucky and lost money. But over the long term those losing days evened out and I never had a two week period where I was down overall.

How To Make Extra Money Online

The more you bet the more even your outcome will become.

Two Types Of Value Betting

There are two ways professionals generally make money from value betting. One (what I call fundamental) is to become an expert in a particular sport and create your own odds, and then when you think the bookie has got it wrong you bet. The other (what I call technical) is to use maths and logic to work out what the market thinks the true odds are, and then bet with bookies who disagree with the market.

1 – Fundamental: Being An Expert On Form

This is the traditional way to make money as a professional sports punter. And is also the type of value betting I have the least experience with. I will freely admit that I am not an expert in any particular sport and would not want to pit my knowledge against the bookies. I would lose.

To make money using fundamental value betting, you need to know a lot about the sport and also how to create odds. You are effectively becoming a bookmaker yourself but taking bets from other bookies rather than from punters.

And in fact going from a professional better to opening a bookmaker is a pretty well-trodden route. If you go to a horse racing track and talk to the small independent bookmakers there you will find that quite a few used to be professional punters. But eventually realised it was much easier to take bets from regular punters than the professionals.

There are plenty of fundamental value bettors but they are often very secretive and will only reveal their secrets after they retire. Until then do not want anyone else competing for the odds they have found and they really don’t want the bookie working out they exist.

What About Tipsters?

At this point I am often asked about tipsters. People who for a fee will give you tips on value bets.

Again they do exist. Good tipsters are often people who used to just bet for themselves but are now banned at most bookies. And even at betting exchanges like Betfair where they don’t ban, they do have premium charges that can make it not worth betting anymore.

This is something I experienced myself when trading on Betfair. Here is the email I received for making too much money at Betfair and getting hit with the premium charge. Bittersweet.

But finding a good tipster is very difficult. Most are amateurs and 9/10 tipsters will lose money in the long run. If you find a good one you want to hold on to it and not tell anyone.

While preparing for this article I asked a friend who makes a living following tipsters for any advice. He wouldn’t tell me exactly which tipster he uses, but he did recommend using a marketplace such as Betting Gods that is impartial and you can see the historic results of a tipster before you commit.

Now on to the stuff I actually do know a lot about.

2 – Technical: Using Technology & Market Data

I may not be an expert in sport, but I am an expert in how the betting markets work and the psychology of a bettor.

Sometimes Bookies Will Disagree With Each Other

There are a lot of different bookmakers and betting exchanges. And all of them have slightly different odds. If two or more start to really disagree and their odds separate then a situation can occur where you can bet on all outcomes and lock in a profit. We call these arbitrage opportunities.

You may already be familiar with arbing or sports arbitrage. If not you can read my full post on arbitrage here.

Now let’s take that concept of bookies disagreeing a step further. When two bookies disagree it normally means that one is right and the other is wrong.

If you can work out which bookie has the cheap odds and only place that bet, you are now value betting.

Whenever there is an arbitrage bet there is also a value bet

But it gets better. And here is the secret that converted me from arbing to value betting. When you place an arbitrage bet you are paying a commission to the smart bookie.

So by value betting instead you are saving on that commission. And you will increase your return on investment.

For reference when I went from arbing to value betting. My return on investment average went from a little under 3% to over 7% of turnover.

Below is a chart showing my profit from value betting vs what I would have made if I had only placed hedged arbitrage bets. This covers the same data as the value betting chart in the previous section.

Now bear in mind I was placing hundreds of bets a day which is why the variance is almost unnoticeable over the 12-month period. Some days, or even some weeks, were losing periods. Wheras with arbitrage there are no losing periods. But in the long run value betting made much more money.

But it goes even further than just increasing your return. Because there are certain situations where there is not a profitable arbitrage bet but there is a value bet. Situations where the difference between bookies isn’t big enough to create an arbitrage opportunity, or there isn’t a liquid enough marketplace for arbitrage. But you can still place value bets.

How do you know which bookie is weak?

Ok so you understand the logic? Now on to the most important question. How do you know which bookie is in the wrong. Which one has the value bet.

Generally there are some tells I look for. And they do change over time and there are special circumstances. So make sure to do your own research and understand why.

Here is a basic hierarchy to get you started:

1. Marketplaces such as Betfair are normally more accurate than traditional bookies. If a bookie disagrees with Betfair they are probably wrong.
2. If one bookie disagrees with everyone else, they are probably wrong.
3. Popular markets are more likely to be right than less popular ones.
4. Asian bookmakers are normally sharper than European.

If you want a simple place to start it is pretty safe to assume that any bookie who disagrees with Betfair is wrong.

Find Value Bets Using Arb Finders

One option is to use a normal arb finding service (I recommend my favourite sports arbing software in this article). And then work out which side of the bet has the value and place the bet on that. In matched betting circles they will often describe this habit as “not laying”.

In the below screenshot I have gone to the Oddsmonkey oddsmatcher and filtered it to show only matches involving Betfair. None of the matches that are shown are arbitrage bets, because the commission you would pay at Betfair would remove any of your profit. But they are value bets.

But traditional arb finding software isn’t designed with value betting in mind. So a better option is to find a dedicated value betting service that works off the technical principles I have described here.

Find Value Bets Using Value Betting Software

Up until a few months ago there were no public services available. The value betting I was doing in my screenshots were all from software we designed ourselves (I studied computer science at university and my masters’ dissertation was on sports arbitrage and value betting).

But recently Rebel Betting (one of the big names in arb finding) have released their value betting service*.

When it came out I was a bit sceptical because I wanted to know exactly how they calculate what is and isn’t a value bet. So I had a long talk with Simon, the founder, and was convinced that they were following pretty much the same philosophy that I was using and recommend here.

I also asked Simon if he would create a discount code or voucher for Rebel Betting. And he was kind enough to create a deal. If you click this link* you will get a “buy one month get one free” exclusive offer to readers and listeners of my podcast.

So you get 2 months for €49. I assume the price will go up at some point as that is really cheap compared to their standard arb finder which €129 a month.

Simon also offered me a refer-a-friend bonus so if you sign up I’ll also earn a bit of money. Win win.

Here are the results of one of their beta testers Mike:

As you can Mike’s does have losing bets. But the variance evened out pretty quickly.

Is Value Betting For You?

Value betting is great and has made me a lot of money. But it does have its downsides. And there is a reason why this is the first time I have spoken about it in detail on this blog.

While value betting is mathematically sound, it also can easily resemble normal betting and has some of the same psychological quirks. With arbitrage or matched betting you know the outcome before placing the bet and so are protected from the swings and adrenaline rushes of betting and risking real money. Not so with value betting.

With value betting luck does come in to play. You can be lucky and make loads of money, but you can also be unlucky and have a few days or weeks down. And I have heard too many stories of value bettors seeing red and and going on a tilt. Betting too much or deciding that they know better than the software and placing their own bets.

How To Earn Money Online Betting Money

It gets even harder when you use the fundamental version value betting (the first method we spoke about) and don’t use software but try and create your own odds. How do you know if you are right or just lucky? And likewise how do you know if you are unlucky or just bad at fundamental value betting?

So I would say, don’t try value betting if you have an addictive personality. Or if you are an adrenaline junkie. Or if you can’t afford to lose the money.

And I would also say that if you are just starting out with profitable gambling. Then value betting is not for you. Ease yourself in with matched betting. Then once you have built up a bank of experience and money you can do some value betting.

So there we have it. I know this is a complicated topic which I have tried to simplify as much as possible, so if you have questions please post in the comments below and I will do my best to answer.

How To Earn Money Online Betting Surveys

I have also recorded a podcast on the same question (what is value betting), so you may want to listen to that as well.

How To Make Money Online Apart From Betting

Listen to episode 33 of the Lazy Entrepreneur Podcast: Value Betting.

How To Make Money Through Online Betting

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