Handicapping the Market in Sports Betting

Those most serious about betting on sports for profit
frequently engage in a strategy called capping the market. This
involves shopping odds at dozens of gambling sites in an attempt
to spot wagers with positive expected value, generally written
as +EV for short. This is perhaps one of the most difficult
topics to instruct as a great deal of the process is intuitive
to those who have spent years using it. For this reason, we
break down the various aspects of capping the market into small
chunks so the casual bettor can better understand how it all
works.

Sharp Books and Square Books

Every sport has what is referred to as sharp book, with some
sports having more than one. An example is Pinnacle Sports that,
despite not accepting US players, offers reduce juice -104
pricing on NFL sides and takes up to $30,000 maximum bets with
multiple max bets allowed for this league. It’s well known that
Pinnacle Sports is one the most difficult sports gambling sites
to beat, even though they generally offer what appear to be
great odds.

Meanwhile, Bookmaker.eu (US players accepted) is also in many
ways a sharp book. They are relevant to professional bettors,
because they were the first to open betting odds, have a great
reputation for fast payouts and no personal limit collars,
accept US players, and have betting limits of up to $50,000 per
bet on NFL football point spreads.

The opposite of sharp books that service professionals are
“square books” or in more politically correct terms
“recreational sportsbooks.” A good example in the US market is
Bovada, an online betting site with a great reputation that only
allows United States residents to open accounts. It has no
interest in professional players and therefore posts their
betting odds much closer to game time than other sites, offers
smaller maximum bets, and doesn’t offer moneylines on all
markets. As we cover below, Bovada, while targeting recreational
players, is a great site for lower or mid-level players.

Now that you have a brief introduction to sharp books and
square books, allow us to show you some of the ways this
information can be used.

Off Market Prices

What does it mean that some betting sites are sharp and
others are square? Shop for off-market prices, and you’ll find
out. Let’s say dozens of betting sites are offering New England
Patriots -7 -105 and their opponent the Washington Redskins +7
-115. We then notice Bovada has the Patriots -7.5 -105 /
Redskins +7.5 -115. Of course it would be silly to bet the
Patriots at Bovada because this would be taking the wrong side
of an off-market price; however, for reasons covered in our
article on buying half-points, here at Bovada, Redskins +7.5
-115 is likely close to a neutral expected value bet.

Steam Betting

To introduce you to the most powerful concept that comes from
monitoring betting odds, we’ll give an example ofsteam
betting. For the example, let’s imagine every online
betting site in the industry is offering betting odds for an NBA
basketball game between the Milwaukee Bucks -7.5 -105 and
Washington Wizards +7.5 -115. You then suddenly notice the line
moves at Bookmaker.eu and BetOnline to Bucks -8 -110 and then at
5dimes to Bucks -8 -108. Meanwhile, you notice all the
recreational gambling sites such as JustBet, Bovada, and TopBet
still have the Bucks at -7.5 -105. The smart play is to quickly
place a wager at one of these websites taking Bucks -7.5 -105
before they get a chance to also move the line.

The reason steam betting is highly profitable is because odds
movement is triggered by something: a highly successful
professional bettor such as Billy Walters making a bet or by
insider knowledge of an injury, player illness, lineup change,
or something else. These odds aren’t moving at sharp betting
sites without reason, and more times than not, moves are the
result of professional bettors using their syndicates to make
bets. Obviously, our goal here is to use recreational sites to
make the same wagers as professionals at the same exact odds.

Sharp Line Movement

Betting steam is difficult to do as the betting odds tend to
move quite fast at online betting sites, while slow moving sites
are quick to limit collar or ban anyone betting steam too often.
The same concept is far more effective by developing the
intuition required to spot sharp line movement before steam
actually occurs.

An example might be seeing an NFL point spread move +6.0 -110
at Bookmaker.eu when the consensus market price is +6.5 -110
everywhere else. This situation happens frequently when
professional bettors from the US make large wagers. Many of
these big players don’t have syndicates, and the only
professional book left in the US market is bookmaker.eu.

Also worth noting: if +6.5 -110 is the fair consensus price
with vig, than moving to +6 -110 in and of itself is not enough
to make a wager +EV. However, knowing that some sharp bettor
somewhere likely made this wager, it’s now useful to do your
own analysis to see if the +6.5 offered elsewhere is worth the
price for other reasons.

How to Handicap the Market

Now that we have covered sharp versus recreational sites and
some uses of this information, it’s time to actually discuss
handicapping the market. Before doing so, allow us to ask a
question. Let’s say all sharp books are offering moneyline odds
on a NFL football game of Patriots -550 / Buffalo Bills +450,
yet someone comes along and offers your choice of Patriots -500
/ Bills +500. Which of these bets would you take and why?

Although many people would answer Patriots for the sole
reason they prefer betting favorites over long shots, most might
not realize that under these circumstances, the Patriots are a
-EV bet and the Bills are a +EV bet. In order to let that
sentence sink in a bit, we move to a new topic before circling
back.

Efficient Market

In the early days of sports betting, it was possible to
profit using a strategy called “Fade the Public.” This basically
meant finding the most degenerate gambler you know, seeing what
he’s betting, and then betting the opposite. This method worked
well as most bookies were independent, offering their own point
spreads and prices geared toward the recreational punter.

If the oddsmaker who capped the game gave the bookie a fair
point spread of -6 on a fan favorite, the bookie might offer
-7.5. The few clients betting the opposite side simply reduced
his risk level, while he booked lopsided action on the side +EV
for him and also had the advantage of charging vig.

Fade the Public Less Relevant

In today’s betting market, the concept “Fade the Public” in
and of itself isn’t a profitable system. The internet has made
the market more visible and also has allowed betting limits to
increase. While local bookies of the past had low maximum
limits, today it’s very easy to get down six or even seven
figures using a combination of sharp sportsbooks like Pinnacle,
SBO, and Bookmaker while using peer-to-peer betting exchanges
such as Betfair.

Meanwhile, there are a plethora of odds tracker sites like
oddsportal.com where anyone can view the betting odds at dozens
of sportsbooks. For this reason, while recreational betting
sites such as Bovada shade their lines in such a way that you
can often get better value on underdogs and unpopular favorites,
they are not shaded so much that +EV betting opportunities
exist.

The reason +EV bets aren’t routinely found at recreational
betting sites is because not only would sharp bettors beat them
badly, but so would arbitrage players and those good at shopping
odds and/or handicapping the market. It doesn’t take a genius to
realize if the sites dealing with the largest bettors in the
world are offering -275 on a Moneyline while recreational
JustBet.cx is offering the other side at +280, then JustBet is
near certainly offering a +EV bet. Because the Internet allows
bettors to shop the odds at dozens of locations with a few mouse
clicks, recreational betting sites can change the lines some,
but not so much, that the other side becomes +EV.

How Bookmaking Works

To have a decent grasp of the betting market, it’s important
to understand how the sharp bookmakers controlling that market
operate. The first step in the process is opening the betting
lines. For NFL and college football betting, the first site to
open is Bookmaker.eu which opens the lines early Sunday evening
for the next week’s games.

When betting lines first open, they are considered rough and
therefore have small betting limits. The goal of the bookmaker
is to sharpen the odds by taking small bets. As these bets come
in they adjust the lines until they find a line where lopsided
action stops. They then keep increasing the betting limits
making additional adjustments.

Come game time, the bookmaker has long since arrived at a
price where the largest and most successful bettors in the world
have no interest betting either side. For all intents and
purposes, he now considers the lines efficient, meaning if we
removed vig, the betting odds given would represent the actual
probabilities of each side winning.

No Vig Prices

Now that you understand more about the betting market,
let’s come back to the question asked earlier: if all sharp
online betting sites were offering -550 / +450 on a game, and
you had a choice of -500 / +500, which would you take and why?
Under these circumstances, -500 is a -EV bet and +500 is a +EV
bet. Many novice punters struggle with this concept, because they
are fooled into thinking the no-vig price of -550 / +550
calculates to -500 / +500. This is false; money lines cannot be
averaged to remove vig.

How to Remove Vig

The correct way to remove vig from a moneyline is to
calculate the implied probability of each side. Implied
probability is simply how often you must win to break even. So
in the case of -550 / +450, starting first with the favorite
(-550) how often would you need to win to break even? The math
for this is risk/return = implied probability. To specify return
means how much a winning ticket would pay.

So for example, staking $550 on a -550 moneyline is risking $550
to win $100, and the return is $650 ($550 stake + $100 win).
When betting $100 on +$450, this is risk $100 to win $450, and
therefore the return is $550 ($100 stake + $450 win). To do the
math and actually calculate the implied probabilities on -550 /
+450, see below:

• -550 is 550/650= 0.84615 (84.62%)
• +450 is 100/550= 0.18181 (18.18%)

Thus, at -550, we need to win 84.62% of our bets to
breakeven, and betting at +450 we need to win 18.18% to
breakeven. Adding these together, we see 84.62%+18.18%=102.8%.
The probabilities are greater than 100% because the bookmaker
has vig. To remove it, let’s divide each by 102.8%. Here you’ll
see 84.62/102.8= 0.82315 (82.32%) and 18.18/102.8= 0.17684
(17.68%). Just like that, the two probabilities (82.32%+17.68%)
now total 100%. From here, we can go to our

odds converter and under the implied probabilities field,
plug in 82.32% to see this is American odds -466 and plug in
17.68% to see this is American odds +466.

We have just determined the fair market price of -550 / +450
is not the +500 / -500 that novice bettors might presume, but
rather it’s actually -466 / +466. Those who thought otherwise
simply misunderstood how juice works. When the bookmaker first
got the report from his oddsmaker, he discovered an 82.32%
chance that Team A will win and a 17.68% chance that Team B
wins. He then built into his margin (juice) by adding 2.8% to
each probability, arriving at 84.62% and 18.18% for -550 /+450.
Perhaps he didn’t actually start with 2.8%; maybe he did 2.75%
seeing that it came to an odd number and he added a little more
to get the clean numbers of -550/+450; but this provides the
general gist of how juice is added.

Simple Logic Leads to Profit

Using the information covered in this article, with a little
practice you’ll be able to start making wise sports bets on
almost any given league without even knowing the sport. To use
an extreme example, let’s say you’re on a holiday in Poland and
are introduced by a friend to the betting site efortuna.pl.
After viewing their odds, you’re shocked at how much juice they
have, but also that the odds are always closer to European
betting sites for one team while way worse for their opponent.

You’ve just discovered the square site for Poland, and using
this information despite knowing nothing about Polish sports,
you’re now able to quickly spot who the fan favorites are. Your
next step is to check out all the betting sites you’re familiar
with to see which offer PLN currency, and trust me, you’ll be
surprised that even US friendly site Bookmaker.eu offers this.

After shopping the odds, you discover that Unibet (which
accepts PLN currency) is offering Team A -260 / Team B +220. You
then find Pinnacle Sports, who also offers PLN currency, has
-230 / +210. Great, so between these two sites we’re getting a
choice of Team A -230 / Team B -220. In deciding which one to
take, we notice square book efortuna.pl is offering -300 / +210
on this game which hints that the favorite is the square side.

We also see that Pinnacle Sports has a $5,000 max bet on this
game and Unibet has a $500 maximum. It appears that everything
is pointing to Pinnacle as the sharp site. We then look at their
betting odds of -230 / +210 and use the math already shared in
this article to see the fair market no-vig price according to
Pinnacle is -216 / +216. Unibet is giving us +220; and we
suspect, based on everything we’ve now researched, that this
probably a +EV bet.

Just from this small experience of betting some random sport
in Poland, we have learned new information we can potentially
use in the future. If we want, we could keep watching to see if
our analysis that unibet is square, efortuna.pl is squarer, and
Pinnacle is sharp is correct.

We could also keep watching to see which other books are
frequently giving off-market prices, where steam plays originate
for this sport, and from where one-off sharp line movement comes
equipped with this info, we could actually start learning the
sport, reading up on it a bit, and following news wires. Those
who understand the betting market well, and can make decisions
based on capping the market, stand a great chance of winning
despite lacking expertise in the sport.

If you are an expert on a sport such as NFL football,
equipped with this new understanding of the betting market,
you’re now ready to learn advanced
football betting strategy. Clicking the link and reading
articles contained within will no doubt help you win more money
this betting season. Alternately, if you are ready to place
wagers and put all this into practice, head back to our
gambling homepage to find the highest-rated sites for online
sports betting.