If you placed a ksh100 bet on Leicester winning the 2015/2016 English Premier League, you would have walked away a winner one year later and Ksh500000 richer. No other business idea will guarantee you a return that can come close to matching the possible winnings from sports betting. However, the truth, to many, is that it is impossible to ever make money through sports betting.
I developed an interest in gambling in 2012, and for two years I dived into the world of sports betting, horse racing, blackjack, slot machines, lotteries, card games etc.
Still, nothing in the gambling world grabbed my attention as much as sports betting. It is important to note that I am one of the biggest football fans you can find out there. As a devout football fan, you develop a knack of making fairly accurate predictions of match outcomes.
After years of betting, against the better judgment of the economist in me, I came to a bitter realization.
Sports betting is ‘rigged’, and the only winner in the long run is Sportpesa and the likes.
With the increasing popularity of sports betting, all my weekends now involve an internal battle between the voice of the economist vs the football fan in me. The likely winner is often the reasonable voice of the economist urging me to put my cash to better use.
To understand why it is difficult for an economist to engage in sports betting, or gambling in general, it is important to understand how odds in sports betting work.
Usually, odds are used to show you the potential winnings. For instance, with an odd of 2.0 on the outcome of a football match, you will win Ksh.200 with a stake of Ksh100.
Stake x Odd = Winning
100 x 2 = 200
However, odds are much more important to the sports betting sites.
First, odds are used to ensure that bookies such as Sportpesa make a profit from all bets placed.
Bookies usually lower the odds on all bets to ensure they gain typically about Ksh5 or more for each Ksh100 bet. This is usually well hidden using complex mathematics, but you can easily spot it.
You can even carry out this simple experiment. Place three bets on all probable outcomes (Win/Draw/Lose) across a number of matches. Two things are bound to happen. One guarantee is that you will never lose, because you have all outcomes covered but you will soon realize that your money is gradually decreasing irrespective of your guaranteed wins.
The bookies have already won before the match even begins.
This is why the first unwritten rule in sports betting should be to never rely on one bookie.
On the other hand, the odds are usually set depending on the probability of the occurrence of the event you are placing a bet on. Thus, the probability of the occurrence of a result with an odd of 2.1 is 47.6% – which is very low. An odd of 3 is 33%, and an odd of 4 is 25%.
The formula is to calculate the probability is: 1 / decimal odds
If the decimal betting odds are 2.10, the equation would look like this:
1 / 2.10 = 0.4761904
Multiply your end result (0.4761904) by 100 to get the percentage: 47.6%.
Keep in mind; the higher the odds, the lower the probability of the occurrence of the expected event.
For an odd of 10, the probability is a mere 10%. This means that for every 10 bets placed, you will likely only win once.
Factoring in multi-bets and jackpots, the chances of winning are so low that you are guaranteed to lose all your money in the long run.
In the world of finance, no investor would ever spend their money when they have less than a 80% – 90% chance of getting a return on their investment – let alone 50 or 10%.
Only less than 10% of gamblers truly profit from sports betting.
Do you engage in sports betting? Let us know your experience in the comments section below.