Money Management in Sports Betting
Sharp Sports Betting is a tool for those interested in winning money at sports betting. This book explains the most common sports bets, what all the numbers mean, and the mathematics behind the numbers.
I’m not saying don’t bet without an edge. Go ahead and bet if it brings pleasure to you, or if it enhances the enjoyment of watching the game. But in terms of what is mathematically optimal, if you have no edge then your optimal bet size is zero.
So if you want to bet on Duke and the only reason is that you graduated from Duke yourself, then go ahead and bet for fun but accept the reality that your bet cannot be justified mathematically.
If you are like me, you probably have a MinWin (minimum win size) in mind when you make a bet. There is no mathematical reason for a MinWin, but nonetheless I have one. The time required to keep track of every bet doesn’t seem like a bother except when a bet is tiny -- the time invested is the same no matter what the value of the ticket. I don’t want to go through the hassle of recording a bet and cashing a ticket if the amount involved is, say, only $10. Like in other forms of casino activity, advantage players in particular should always be aware of the value of their time, and continually determine the wisest use of that time.
It does not matter what your personal Min-Win is, and likewise my personal MinWin should be no more than a matter of curiosity to you. This money-management discussion merely assumes that you have a personal MinWin.
Maybe instead of MinWin, you have a standard bet size. Maybe every time you make a bet, it’s $110. If you like a game you bet $110 on it, to try to win $100, and if you don’t like either side enough you don’t bet the game. If that describes you, your MinWin for purposes of this article is $100.
The reason for focusing on a MinWin (of say $100) instead of a minimum bet size (of say $110) is to simplify the discussion of how much to bet if the terms are other than -110.
The important thing to keep in mind when betting sports is that mathematics justifies making a bet only when you have an edge. If you do not have the expected value in your favor, then you are better off keeping your money in your pocket.
You must have your own personal MinEdge (minimum-edge requirement) for making a bet. If you are leaning toward a team but do not think it is likely enough to win to justify betting to win your MinWin, then you should pass on that bet. Most sports bettors who have mentioned the subject of minimum edge on BJ21.com seem willing to wager with an edge as small as five percent. Again this is a personal decision; the important thing is that you need a MinEdge to justify a bet.
Five percent edge is not a magic number. I suggest having a MinEdge of at least 2.5 percent, but there is nothing wrong with requiring a MinEdge of greater than five percent.
You must decide what is right for you. If your personal preference is to make a few large solid bets rather than a large number of smaller bets, you might prefer a MinEdge of say ten percent on every sports bet you make. The higher your personal MinEdge for making a bet, the fewer bets you will make.
I suggest keeping careful records of all your bets so that you can look back and see how well your picks have done. You will need these records for tax reporting as well. The best measure of the expected value of your picks is the ratio of your net winnings to your total bets. If you really are making bets each of which has X percent MinEdge or more, then after a few hundred bets you ought to be able to add up your winnings and find that they are greater than that same X percent of your total bets.
To be continued ...