This week marks the start of my second football season as a part-time columnist and the resumption of weekly publication (instead of my cushy off-season schedule of one issue every 2 or 3 weeks). For those of you that are new readers (and especially for new bettors) let me provide a little introduction.
Do you want to know why the pointspread moved from -7 to -8 on your favorite team last week? Have you ever wondered what goes on behind the scenes at a Sportsbook? If you’ve answered yes to either question, then you’ve come to the right place. I will take you behind the front lines to help you understand how the sportsbook business operates. As the Operations Manager for Bodog Sportsbook, Casino and Poker, I talk to book-makers, handicappers and players every day, so I can shed some light on the mystery of what goes on behind the numbers you see on your screen. Knowledge is king in this business, so my hope is that by reading this column, you’ll be better armed to make the right choices when it comes to picking the right teams and the right sportsbooks.
As a starting point for our weekly discussions, I want all players to understand the basic business model of sportsbooks. As you all know, when you place a straight wager on the pointspread of a football or basketball game, you need to risk $110 to win $100. The $10 difference between risk and payout is known as the juice, or the vigorish (or just vig for short) and is the reason sportsbooks are in business. Sportsbooks essentially act as a broker between you and another player who wants to bet on the other team and collects the small commission as compensation for brokering the deal and handling the transfer of funds between the two of you. This is important to understand, because it leads me to the biggest misconception in sports wagering. The pointspread is not the handicapper’s predicted margin-of-victory, but it is in fact the handicapper’s prediction of what number will be required to split the wagering evenly on both teams.
Now I want to discuss in a little more detail how the pointspreads are derived and what you need to know to take advantage of the numbers.
Linemakers are divided into two groups, oddsmakers and bookmakers. Oddsmakers deal in a theoretical world because they don’t actually take bets on the lines that they publish. Oddsmakers make their money by selling their lines to media outlets, sportsbooks, etc. These are the lines you see in your local newspaper or hear on the radio. The lines don’t change very much from day to day, because there are no direct wagers placed on these lines, and as such, there are no line moves required to try and balance action. On the other hand, bookmakers deal very much in the real world, as they take bets on the lines they publish. These lines then move as a result of wagering, because the books seek to balance action in an effort to minimize risk and maximize the vig (commission) collected. This fundamental difference is one of the main reasons that the lines you see in your newspaper are not always the same lines you get when you deal with a sportsbook. It is worth mentioning that time is also a factor. The lines in your paper were probably accurate (for lack of a better phrase) when they were submitted to the editor, but in the amount of time that passes from pre-production to when you read the paper, injuries, weather and other factors can dramatically shift the spread.
Linemakers use a variety of methods to calculate their idea of the pointspread. I cannot say which methods are best, or who is the most accurate. If I had this figured out, I would be sitting on a beach somewhere, enjoying my millions won betting on sports. Some linemakers use complicated computer programs that factor in recent performance, injuries, player match-ups, etc. Others simply have a feel for the games and produce a number out of thin air. However, most line makers use power ratings or some derivation. Power ratings involve assigning each team a numerical value based on performance and than comparing the ratings to generate a pointspread. For example, one set of ratings I saw last week had St. Louis rated 34 and San Francisco rated 30 so the difference would result in a 4-point line (assuming a neutral location) with the Rams as the favorite. The home team usually gets an additional 3 or 3.5-point advantage so if the game was in San Francisco the Rams might be a 1-point favorite. In St. Louis the Rams might open as a 7-point favorite. You get the idea. There are no standards for how to derive these ratings, and developing a good method is the key to success as predicting actual outcomes with better accuracy than the majority of the betting public is your key to success.
A few sportsbooks base all their lines on their own internal linemaking, but the majority of books rely either solely on oddsmaking services or a combination of external service and their own handicapping. I asked Kent, Bodog’s top bookmaker, how he derives lines, and he explained that his team handicaps the games themselves, compares these results to the opening lines out of Vegas and then adjusts for the historical action of Bodog’s player base before coming up with an opening number for each game. From there, the numbers are moved only to balance action or to account for special circumstances such as weather, injuries or the like.
Now that we know how lines are generated and where sportsbooks get them from, lets discuss what you need to do to win. You have some advantages over the sportsbooks that can compensate for the vig you pay on a winning bet. The key advantage is that you do not have to wager on every game, you can pick and choose your wagering opportunities. The bookmaker puts up a number on hundreds of events each and every week. In a typical NFL week, there are as many as 16 games for you to choose from and there are multiple betting opportunities on each game. You may not have a good feel for every game, but you most likely see several games where you are confident that one team will cover with better than 52.4% probability (52.4% is magic number to cover the vig on a standard football pointspread wager). This is what handicappers refer to as an overlay or getting value. For example, if you think Miami will win by 10 points and the pointspread is only 4.5, you have an overlay. The odds appear to be in your favor and if you find enough of these situations, you can make a profit betting on sports.
Next week, I will take a look at wagering on preseason NFL games. I look forward to a great football season and hope you find the columns helpful.
The enjoyment of your wagering experience with us is my number one priority. Should you have any questions, concerns, or comments, I will personally ensure you are satisfied with your Bodog experience.
Good luck with your wagers!
Rob Gillespie is President of Bodog Sportsbook & Casino
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