When it comes to popular pastimes around the world, sports betting is right up there with the best. It is now an industry thought to be worth around $833m per year in the USA alone and one that is predicted to rise to annual revenue of $8bn in the States by 2025. When you also look at how popular betting on sports is across the rest of the planet, you can see how much we all love it.
Of course, sports betting has come on in leaps and bounds during recent years thanks to legalized online sportsbooks and the latest mobile apps. Even a brief look at the best New Jersey gambling app shows that to be true. One thing you will notice every time you log into an app like this is the odds are shown for a particular team or player in a match. But how do bookies come up with them?
How are odds worked out?
Whether you bet on sports in person, via a bookmaker or online, odds are always there. If you mainly play online roulette or other casino games, this can be tricky to get a grip on. The first thing to know is that bookies themselves never gamble on one outcome happening over another.Instead, bookies are very careful to set odds that reduce their exposure and leave them with profit, whatever happens (within reason). Of course, they also take care to set odds that accurately show the probability of any outcome occurring.
To begin with, bookies set their margin – that is the profit they plan to make. This figureis incorporated into their thinking when setting odds. The bookie will then carefully consider and research each match on which they will take bets. That enables them to set odds for each outcome occurring that is sensible. Let’s say Liverpool are taking on a non-league team at Anfield in a cup game – they would look a little daft to be setting low odds for the non-league side to win!
What happens next?
Once the bookie has calculated the odds of each outcome happening, the margin they decided on is taken off. The new odds which remain are the one they will offer to punters. Of course, the other thing to factor in when bookies set their odds is how the market is moving. They may set their odds at 5/1 initially for one player to win a tennis game, for example, but bring these down to 2/1 if they notice the market is taking a lot of money for that same player to win. Doing so means they do not get caught with big payouts ifan event occurs which they did not foresee.
Understanding the odds is vital in sports betting
But how does this affect those who like to bet on sports matches? Knowing how odds are worked out can help in terms of knowing how likely something is to happen or where to put your money, based on odds shortening or moving out over time.