How do your money management skills stack up? Take the following short quiz and find out:
1. After a short-term winning period, are you quick to raise your bet amounts for the following week?
2. After a short-term losing period, do you then lower the amount of your plays?
3. Do you (or have you ever) put all of your action on one game?
4. Do you ever find yourself chasing your losses?
If you answered yes to any or all of those questions, you may want to consider breaking a bad habit (or two).
Poor money management generates more losses for players than bad handicapping. Even the worst bettors seldom lose more than 55% of their picks. On the other hand, good money management skills will not always make you a winner (that still has to come from choosing the right teams), but it sure will help your bankroll last.
The Good, the Bad and the Ugly
Take a look at the following four scenarios. If you recognize any of these habits as your own, now’s a good time to make amends:
Scenario A – Raising your bet amounts. Alan is a $100 player. He typically plays half a dozen or so games a week and is a dedicated handicapper. The first week he makes 5 wagers of $110 to win $100 and goes 4-1. For the week, he has made a profit of $290 (4 wins of $100 and 1 loss of $110), a great week by any standard. He now thinks his handicapping skills are so sharp that he can beat the house on any week and now raises his plays to $200. In the second week he makes 6 bets of $220 to win $200 and goes 2-4. For the week he has lost $480 (2 wins of $200 and 4 losses of $220). So overall, Alan has lost $190 despite going 6-5 overall (54.5%). If he had simply played $110 on all 11 games he would have made $50 in profit. Raising the size of your plays after a short-term winning period will benefit the House greatly if and when things even out.
Scenario B – Lowering your bet amounts. Bill is also a $100 player but has a slightly smaller bankroll than Alan. He makes 6 plays of $110 and goes 2-4 for a loss of $240 (2 wins of $100 and 4 losses of $110). His bankroll is now too small to be able to play $100 a game so in the second week he only makes 5 plays of $55 to win $50 each. This week he wins 4 of the 5 and makes $145 (4 wins of $50 and 1 loss of $55). He now has the same overall winning record as Alan (6-5) but is down $95 anyway. Lowering the size of your plays after a short-term losing period or not having enough funds to make your plays will also benefit the books when your turn to win comes.
Scenario C – Risking your balance. Charlie likes to take big risks for big rewards. He posts up $110 and risks it all on a single game Saturday night, which he wins. His balance is now $210 and he risks it all on a Sunday 1pm game, which he also wins to bring his balance to just over $400. Feeling lucky, he puts the whole amount on a 4pm game and wins again to get his balance to an incredible $765 (and change) in less than a day. Then, he decides to go for the big win and risks the whole amount again on the Sunday night game, which he loses. Charlie has now lost $110 despite going 3-1. Wagering $110 for each of the four games would have yielded a profit of $190. Remember books have a 50/50 chance of wiping you out when you put all your action on any one game and those odds will catch up with you eventually.
Scenario D – Chasing your losses. David has a bankroll of $1000. He wagers $110 on a game and loses. He is frustrated at losing the money and wants to win it back so he wagers $121 (to win $110) on a second game and loses as well. He is now down $231 and is really frustrated. Thinking he can’t lose 3 in a row, he wagers $254.10 (to win $231) and loses yet again. He has now lost $485.10 and even a win with his remaining balance of $514.90 won’t get him back to even but he puts it all in play on another game hoping to get it close (it would be a win of $468.09). He loses the fourth game and has busted out. Losing streaks will happen to every player every year no matter how good they are and players that chase losses will not last for long.
Good Money Management: What You Need to Know
Money is an emotional thing. The more you have, the more you spend. If you don’t have enough of it, then you’re left wanting more. Generally speaking, those two factors alone will drive people to do things that they probably shouldn’t do. To avoid heading down this path, however, here’s what you should do: Keep your bets to reasonable, affordable and consistent amounts and your bankroll will last a long time. If you can pick more than 52.4% winners, you will come out ahead of the book in the long run and that is the only time frame that matters!
Stick to sports you know. There’s an old joke in the industry about the guy who ran his account balance right down to the ground. He went 0-5 on baseball for the day, 0-5 on basketball for the day, and 0-5 on football for the day. So one night he calls the book manager, desperate to get something back. He asks the book manager, What else have you got on the boards? The book manager says, Well, baseball’s done, basketball’s done, football’s done, but I do have a late hockey game. So the guy says, Hockey? What do I know about hockey? To which the book manager replies, Look, you’re 0-15 for the day. What do you know about football, basketball, or baseball?
One of the best handicappers I know once said, The Super Bowl is just another game. Actually, our first meeting was rather interesting. We were in Vegas, watching the Monday Night Football game from the bar at the Luxor Hotel. I asked him who he was cheering for and he said that he didn’t release a pick for that game. I was shocked. He realized that he probably disappointed a lot people, but because he didn’t have a good feel for the game he didn’t want to give out a pick. In my opinion, not only did that demonstrate his integrity as a handicapper, but it also proved that he was in it for the long term. He’s disciplined.
Food for thought: People are quick to justify their losses, yet they never forgive themselves when they miss a winner. Remember that Monday Night Football is just another football game. Know that the Super Bowl is just another football game. And look at it this way: there’s something to bet every single day of the year. If you don’t put your bet in today, there’s always tomorrow. Even in betting, patience is sometimes a virtue.
Good luck with your wagers!
Rob Gillespie is President of Bodog Sportsbook & Casino
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