PRLog - April 1, 2015 - On March 14, a Romanian gambler named Laurentiu Andronache uploaded on SlideShare his first ever presentation. While its design certainly wasn’t memorable, it was introducing to sports bettors around the world the new concept of “honest odds”. The main takeaway was a simple formula that transformed the odds offered by a bookmaker to odds that would make him break even in the long run. In order to work, the market that the bookmaker was creating had to be efficient (multiple studies have shown that to be the case for big bookmakers at the money lines and the spread lines) or he had to handicap events perfectly. This seems certainly useful in order to determine when you’re getting screwed with bad odds, but nothing else. Even the description of the presentation summarized: “Learn how to calculate the honest odds because otherwise you might start to believe that the risks offered by your bookmaker are appropriately rewarded.”
But this was just the first lesson of his guide
Before going further, I must remind you that becoming a long-term winner at sports betting is really hard. Don’t listen to your deluded friend when he brags about it; he’s actually losing money in the long term. If he’s into accumulators and other types of fancy bets (like choosing the goal scorer) he’s probably losing consistently in the short term as well. A study named “Sports betting: can gamblers beat randomness?” concluded that “the information used by bettors, along with near-misses, reinforces their perception of expertise. The results of this experiment suggest that the so-called ‘skills’ of the sports bettors are cognitive distortions.” (Cantinotti et al. 2004). Since people deal with too much information by enforcing biases, experts/tipsters are no better than a system which would always take the home win (Forrest & Simmons 2000, “Forecasting sport: the behavior and performance of football tipsters”) or a system that would take the team with better historical results as the winner. Paradoxically, a layman could give you better picks than a soccer expert, simply through heuristic analysis (Andersson et al. 2005, “Predicting the World Cup 2002 in soccer: Performance and confidence of experts and non-experts”). In “Sports forecasting: a comparison of the forecast accuracy of prediction markets, betting odds and tipsters” (2008), Spann & Skiera concluded that the prediction markets and the bookmakers yielded “a comparable and good forecast accuracy”, while the tipsters were just a bit better than a system which would choose the winner randomly. Is your friend winning at sports betting? Probably not.
Take all this into consideration before reading further.
On March 21, Laurentiu Andronache published the second lesson of his guide, curiously named “Bulldozing small bookmakers”. It went mostly unnoticed, even though the information provided there was quite interesting for bet-takers and bettors alike. It is a strategy that defeats certain bookmakers and numerous people at the exchanges. Their mistake is either that they use fixed odds or they do not correlate the probabilities on their events with the probabilities generated by an efficient market. Bulldozing is a new term and the presentation exemplified how anyone could easily calculate the honest odds for the events of a big bookmaker, then use them to participate in bankrupting a smaller one. It’s quite easy to understand… let’s say Federer is playing against Nadal and some friends of the latter find out he’s injured and his morale is low. Big bets will be placed on him to lose at the big bookmakers, therefore forcing the odds to change and reflect the new probabilities. At the smaller bookmakers this kind of information will arrive slower or it won’t arrive at all, therefore they will still offer odds rooted in the old probabilities. Even people unaware that Nadal is injured will be able to deduce something is wrong because they’ll see the odds changing at the big bookmakers. They can then place a value bet on Federer to win until the odds at the smaller bookmakers get in line with the honest odds of the bigger bookmakers. If they are fixed, even better, then everyone will get to make a profitable bet on their expense. Bulldozing is fun indeed.
For anyone interested, here are the presentations that were mentioned:
This is an example of a study supporting bulldozing as a strategy: “On determining probability forecasts from betting odds”, Štrumbelj 2014.
From the abstract: […] We also provide empirical evidence that some bookmakers are significantly different sources of probabilities in terms of forecasting accuracy, and that betting exchange odds are not always the best source, especially in smaller markets. The advantage of using Shin probabilities and the differences between bookmakers decrease with an increasing market size.
Laurentiu Andronache has stated that he has already planned for the next two lessons: “I know that in lesson 3 I will discuss how everybody seems to be using the Kelly staking wrong and lesson 4 will be called ‘The Power of Priority Information’. The whole guide will have around 10 lessons. Once I finish with them, life will be a lot harder for the average bookmaker.” He has also called upon help from fellow professional gamblers in order to write articles for gamblers-united.com to educate the population and make the tagline of the project come true: “Intelligent risks. No more gambling when the house has an abusive edge.”
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Sports betting system that actually works revealed
April 01, 2015 at 13:14 PM EDT