Odds Calculation – Soccerwidow http://www.soccerwidow.com Football Betting Maths, Value Betting Strategies Sun, 26 Feb 2017 11:21:12 +0000 en-US hourly 1 https://wordpress.org/?v=4.7.2 Are Betting Odds Worthwhile Calculating? Are Betting Odds Always Fair? http://www.soccerwidow.com/football-gambling/betting-knowledge/value-betting-academy/learning-centre/betting-odds-worthwhile-calculating-to-check-if-fair-4713/ http://www.soccerwidow.com/football-gambling/betting-knowledge/value-betting-academy/learning-centre/betting-odds-worthwhile-calculating-to-check-if-fair-4713/#comments Sun, 15 Jan 2017 04:05:01 +0000 http://soccerwidow.com/?p=4713 more »]]> Why are there more Losers than Winners in the Sports Betting World?

A vast amount of gamblers never achieve betting returns high enough to crossover to the exclusive group of people who make a living from betting. Even worse, the majority of sports betting practitioners consistently lose more money than they win.

Punters learn the hard way that they lack knowledge and understanding of probabilities. They constantly overestimate their skills in judging the chances of predicting an outcome.

Want to Win more than you Lose? Go Back to School...Collage of Shutterstock images: 3Dmask

Bookmakers remain in business and thrive at the expense of the majority of gamblers who possess two perfect flaws in their thinking:

A ‘strike it rich’ mentality which, in its most advanced state becomes ‘greed’

    and

A degree of ignorance when it comes to calculating betting odds

This particular human behaviour guarantees bookmakers their profits but, it’s devastating for the bank balances of bettors. Does this sound familiar to you?

Good Knowledge and Understanding of Probabilities Required

To make money with sports betting, determining the probability of a bet outcome and calculating the corresponding odds for it are unavoidable.

Comparing the betting odds offered in the market with the expected fair price is a constituent part of discovering whether the odds offered for a bet are too high (containing value) or, too low (without value).

Here is an example:

The screenshot below shows an excerpt from Soccerwidow’s Value Calculator for the EPL game on 25/10/2014 between West Ham and Man City.

HDA Odds Calculation via Soccerwidow's VC: West Ham vs Man City - 25.10.20141×2 Odds Calculation via Soccerwidow's VC: West Ham vs Man City on 25.10.2014

The statistical probability of a Man City win was 49%, corresponding to ‘true odds’ of 2.04 (100/49).

Translated into layman’s language the chance of Man City winning this match was approximately 50/50. Of course, this meant West Ham had a 50/50 chance of avoiding defeat (i.e. West Ham winning or drawing the game).

However, at kick-off the highest odds on offer for Man City to win were only 1.65, equating to a 60.6% chance (100/1.65).

Everyone who bought a bet on Man City to win placed their bets at the price corresponding to a 60.6% chance, whilst in truth City’s chances were only 49%.

Without a satisfactory knowledge and understanding of betting odds and probabilities, there were probably tens of thousands of punters backing Man City, clearly priced as the favourite in this match, at massively under-priced odds.

People who bet like this over and over again shouldn’t wonder why they lose more money than they win over the course of a season.

In contrast, the bookmakers make a good profit from bets of this nature. In this particular example, offering odds of 1.65 equates to a mathematical advantage over the punter in excess of 20%, meaning that their profit on a whole portfolio of bets like this is, in the long run, at least 20% or above.

Are you still with me?

You need to understand that the ability to calculate probabilities and odds is crucial and will enable you to better judge if odds are over- or under-priced (i.e. worthwhile or not).

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How do Bookmakers Tick? How & Why do they Set Their Odds as they do? http://www.soccerwidow.com/football-gambling/betting-knowledge/betting-advice/bookmakers/how-do-bookmakers-tick/ http://www.soccerwidow.com/football-gambling/betting-knowledge/betting-advice/bookmakers/how-do-bookmakers-tick/#comments Thu, 12 Jan 2017 08:00:20 +0000 http://www.fussballwitwe.com/?p=2343 Becoming a successful bettor requires not only a deep understanding of odds calculation but, it is also necessary to understand how the market works and especially how the bookmakers operate.

Of course, bookmakers are in the business of setting odds and determining prices which are offered for certain betting events.

Cartoon: Group looking at a whiteboard with very strange word on it / Karikatur: Gruppe vor einem Whiteboard mit einem sehr seltsamem WortIf I had to use just one word to describe how bookmakers think…

Image: Cartoonresource (Shutterstock)

When viewing odds in betting exchanges such as Betfair, Betdaq, Smarkets, or WBX, you should understand that it is neither the exchange platform or the traders using them who set the odds.

The fact is that the bookmakers are used as the market guide for traders on the betting exchanges, and it is the bookies who compile and publish their odds weeks in advance of the events in question (sometimes even months), and certainly well before the exchanges even open their markets for trading.

If you have ever calculated odds you will have noticed that the bookmakers’ offers often do not represent the ‘true’ picture, in other words, the ‘true’ mathematically calculated values (the statistically expected values).

Only occasionally (probably in less than half of all cases) are odds close to the statistical expectations of the betting event. However, in the vast majority of games, odds are either considerably higher than mathematically expected or far lower…

Why Is This So?

You have to appreciate that bookmakers do not really intend to predict an outcome (correctly). If you enjoy statistical analysis, then take a little time to do a simple calculation for any league of your choice. Simply convert bookmaker odds into probabilities and compare them to the actual distribution of the results.

Bookmakers have been around for thousands of years in one form or another. Their main goal is of course to make a profit. They price their odds to ensure that sufficient action is taking place on both sides of a bet.

If a bookmaker’s betting odds are not aligned to public opinion then a disproportionately large amount of money will be placed on only one side of a bet. This would be a gamble for the bookmaker. However, bookmakers are not in the business of speculating on an outcome.

The role of bookmakers is, strictly speaking, rather the function of an intermediary, similar to a stockbroker. They take money from various people on various outcomes and after the game is finished they pay out the winners.

In return for this service, the bookies take a “fee” known as the overround.

The bookmakers’ priority is balancing their books

The closer to the kick-off of a game, the more ‘fluid’ the odds become, as salient information such as team news becomes public knowledge, and this then has a knock-on effect with bettors’ opinions being confirmed or changed on the outcome of the match in question. Thus, the odds tend to change more as the start of the match gets nearer and nearer and more money changes hands.

Always remember

  1. Bookmakers set odds based on a mixture of statistical probabilities and public opinion.
  2. Bookmakers do not speculate (gamble). Their priority is balancing the books.
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Understanding Goal Lines in Over Under Betting http://www.soccerwidow.com/football-gambling/betting-knowledge/value-betting-academy/learning-centre/understanding-goal-lines-in-over-under-betting/ http://www.soccerwidow.com/football-gambling/betting-knowledge/value-betting-academy/learning-centre/understanding-goal-lines-in-over-under-betting/#comments Tue, 10 Jan 2017 11:45:19 +0000 http://www.soccerwidow.com/?p=5796 more »]]> Have you ever wondered what the different Goal Lines mean?

You can bet on Over/Under 2.5, or Over/Under 2,25 or Over/Under 2. But what are Over 2.5 bets, or even 2.25? There are no half goals! Or quarter goals! It doesn’t seem to make sense. Does it?

We will explain what the different Goal Lines signify and after you’ve finished the article you will never be confused again!

Betting on .5 Goals

One of the most common bet types is Over/ Under .5 goals.

Obviously, there is no way for half a goal to be scored in a game. The expression .5 is just an aid to ensure that it is clear on what you are betting.

For example, if you place a bet on Over/Under 2.5 goals, then the .5 is the ‘turning point’. You win if there are at least 3 goals scored, and you lose if the match ends with less than 2 goals scored.

Here’s an example…

Betting on Over/Under 2.5 Goals - illustration

If you still have difficulties understanding the concept, here’s another article on the .5 bet: A Brief Introduction to Over Under Goals Betting.

Betting on Goal Lines with Whole Numbers

Bets on whole numbers are often called Goal Lines or Asian Goal Lines. Although, technically, this isn’t correct as all bets described here are ‘goal lines’, but we will be using the term as it’s widely used by punters and bookmakers.

They are somewhat similar to Asian Handicap betting on the 1×2 result. As the name suggests, the possibility of a refund exists if a certain result comes in, in this case the ‘Goal Line’.

Similar to the AH, if the match finishes in a draw result (= ‘goal line’), it’s a “push”. The punter gets their money back. Otherwise, if there are less goals scored than the goal line, the stake is lost, and if more goals are scored, it is a win.

Illustration: Over 2 Goal Line Bet

In the above example, if you were to bet on Over 2 Goals then you get your stake back (push) if the final score is exactly 2 goals (e.g. 2-0, 1-1, 0-2).

All the other Goal Lines naturally follow the same pattern.

Betting on .75 Goals or .25 Goals – or – Whole Number, .75 or .25

If the .5 bets are combined with Asian Goal Line bets, then you get .75 or .25 Goals bets. Half of your stake is placed on the .5 bet whilst the other half is placed on the Asian Goal Line bet.

These bets are often shown as either Over 2.25 – or – Over 2, 2.5.

Illustration: Over 2.25 Goals / Over 2, 2.5 Goals

For example, if you place a bet of £20 on Over 2, 2.5 it means that you are placing a split bet. £10 on the 2 Goals Asian Goal Line, and £10 on Over 2.5 Goals.

If the match finishes…

  • with 3 or more goals, then you will receive the winnings of both bets
  • with exactly 2 goals, half of the stake will be returned as it was a push (2 Goals Asian Goal Line), and you will lose the other half (Over 2.5 bet)
  • with less than 2 goals… your entire stake is lost

The same applies to the .75 bets, as shown below:

Illustration: Over 2.25 Goals / Over 2.5, 3 Goals

In this example you place a £20 bet on the Over 2.5, 3 goal line. Again, you would be placing a split bet. £10 on the 3 Goals Asian Goal Line and £10 on Over 2.5 Goals.

If this match finishes…

  • with 4 or more goals, you will receive the winnings of both bets
  • with exactly 3 goals, half of the stake will be returned as it was a push (3 Goals Asian Goal Line), but you will win the other half (Over 2.5 bet)
  • with 2 or less goals… your entire stake is lost


To be honest, I would recommend keeping your hands away from these bets, although it may sound tempting to get half of the stake back. Although these are referred to as being a single bet they are actually two completely different bets rolled into one!

If you do not really understand odds calculation and probabilities, then it is definitely a bet which bookmakers love! They can adjust the pricing as they like, without the average punter fully understanding the maths behind it, ensuring that the mathematical advantage lies with the bookmaker.

Anyway, the silver lining is that it is quite unlikely to be exposed to the temptation as these bets are rarely offered by European bookmakers.

Here is another diagram to demonstrating split bets:

Illustration: Goal Line visualisation

Betting for Profit on Goals

At the end of the day the goal of each punter should be betting for profit. Am I right?

Bookmakers make a living from betting by using maths. They analyse and calculate the chances of an outcome and then price their bets. Of course, they make sure that the mathematical advantage is on their side, just like anyone operating a game of chance (e.g. Casinos).

The punter who relies only on gut feeling does not have a chance against the bookmakers.

However, with Over/Under Goal bets the punter at least has a chance to start understanding the statistics behind the bet. It isn’t too difficult to calculate the probabilities of the various results and number of goals in a game and to then find value bets.

If you are interested in starting to bet for profit, then you should seriously consider buying our Fundamentals of Sports Betting course. For the first volume, we have chosen to write about the Over/Under goal market as this is the easiest betting market to teach the fundamentals of statistics and maths on, without the need to dive deeper into more advanced formulas and concepts. Give it a try!

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Frequently Asked Questions – Fundamentals of Sports Betting Course http://www.soccerwidow.com/football-gambling/betting-knowledge/value-betting-academy/frequently-asked-questions-fundamentals-of-sports-betting-course-over-under/ http://www.soccerwidow.com/football-gambling/betting-knowledge/value-betting-academy/frequently-asked-questions-fundamentals-of-sports-betting-course-over-under/#comments Tue, 20 Dec 2016 06:32:38 +0000 http://www.soccerwidow.com/?p=5602 more »]]> Here are the most frequent questions asked by our readers and customers about the course. If you can’t find an answer to your particular question, then please free to ask us using the comments section at the bottom of this page. We usually reply within 24 hours.

These FAQ’s refer to the: Fundamentals of Sports Betting: Betting on Over Under ‘X’ Goals course.

Click on the arrows to reveal the answers.

Popular Questions

What’s the point of calculating odds yourself?

This is a very, very popular question and is answered in a dedicated article: Are Betting Odds Worthwhile Calculating? Are Betting Odds Always Fair?

Am I correct in assuming that you don’t use the usual criteria that 98% of ‘hobby punters’ employ when forming their opinions? I mean the last 6 games, the H2H stats, team news, etc.

Are your parameters different from the usual bog-standard criteria?

Yes, absolutely. The gambling industry as a whole relies to a large extent on the ignorance of its customers.

This course is designed to give the reader the essential, fundamental knowledge necessary to understand the bookmaker market.

We teach descriptive statistics and the reader learns how to look at data sets, calculate own probabilities and odds, analyse the market odds on offer, and make informed decisions when predicting football results.

Many false beliefs that the majority of gamblers and fans of football have about betting will be exposed and stripped away.

If team news, injuries, suspensions, recent form, etc. would have any relevance to setting odds how would bookmakers, who publish their prices weeks in advance, stay in business?

Will the course help identify value in-play?

With respect to in-play value the course is very helpful as you can apply the knowledge of calculating probabilities to both the half-time and full-time goals market.

Then you can choose, for example, matches with a high probability to score during the first half. These matches you can back, say Over 2.5 goals before kick-off, and lay them as soon as the first goal has been scored.

We are going to address this in more detail in an article to follow.

Can odds be calculated for Over 1.5 and Over 2.5 using this course?

Yes, the odds for all Over and Under options can be calculated using this course including Total Goals.

The course is about the German Bundesliga. Why not the EPL?

Yes, we are fully aware that the majority of our readers are far more interested in the EPL than the Bundesliga, but the problem is that the average punter is very influenced by his/her opinion and ‘knowledge’ about their own supported league.

It was therefore important to choose a more neutral league for the course, one where gut feelings and emotions are less strong. It had to be a league which is also well known, with plenty of bookmakers offering odds, and at the same time one where the majority of our English speaking audience is unlikely to connect emotionally.

Thus, the Bundesliga it is!

Are the principles and analytical techniques in this course transferable to other European football leagues?

Absolutely! The principles and techniques are transferable to any football league worldwide.

>>> read an excerpt from the book <<<

Product-Related Questions

Is it correct to say that the course is exclusively for the Over/Under Goals market or are the skills learned from it transferable to other bet types, such as 1×2 betting or Asian Handicap?

Yes, that is correct. Fundamentals of Sports Betting – Over/Under ‘X’ Goals is the first of a series of books educating the ‘Fundamentals of Sports Betting’.

There are more topics planned such as ‘Betting on Home, Draw, Away’, ‘Asian Handicap’, or ‘Betting In-Play’, and so on. Of course, it will take a while until all of these books have been written and published, but we reassure you that more course books are on their way.

For the first volume we have chosen the Over/Under goal market because this is the easiest betting market to teach statistics and maths without the need to dive any further into much more advanced formulas and concepts. You will need a basic grounding before moving on to more complex calculations for bet types with multiple options such as 1×2, HT/FT and the Correct Score market.

The course explains everything using European odds. Can I get the course with fractional odds?

Sorry, but we don’t offer the course in any other odds format than European odds.

The majority of calculations are carried out using probabilities (percentages) and these can easily be converted into fractional odds, or any other odds format. See our article here: Understanding Betting Odds – Moneyline, Fractional Odds, Decimal Odds, Hong Kong Odds, IN Odds, MA Odds

The automated Excel file sounds particularly interesting. What exactly is automated?

The tables in the Excel file are fully automated. Just select a team from the list in the ‘Betting Tables’ tab (cells B3 to E3) and every calculation in the workbook will update automatically to those of that team’s stats. How this works exactly and what the numbers mean is explained in greater detail in the course.

Is the course only available as a PDF or can I get a printed version like the one shown on the advert?

The PDF has been professionally optimised for double-sided printing. Just print your book in full-colour with a cover and add a binding of your choice.


Purchase Questions

There is a heading “Value Betting using the Value Calculator”. Does that mean that I will receive the Value Calculator (VC) for free when I buy the course?

You don’t need the Value Calculator to understand the course, therefore the VC is not supplied with the course.

When we refer to the ‘Value Calculator’ we explain how it works and what the calculations mean in terms of Over/Under bets. Of course, the VC also contains a wide range of other bet types such as FT and HT 1×2, Correct Scores, HT/FT, and many more. The goal of the course is to enable the learner to create his/her own Excel application which works for him/her. Empowering learners to think for themselves is one of our ethics.

Having worked through the course you should be able to build a Value Calculator yourself, if your Excel skills are good enough.

If I purchase the course, what else do I get?

The course comes in an electronic format and the bundle includes the course book (PDF) and a Bundesliga cluster table (Excel), which the examples are based upon.

In addition, you will receive for free the very latest Bundesliga table for the current season (valued at £27.50).

Within the course you will find a discount code enabling you to download for free the German Bundesliga sheet in future seasons, meaning that you will always have access to the most current Bundesliga cluster table, forever: it doesn’t matter when you bought the course.

Could you tell me where I can buy the Value Calculator if I can’t build one myself?

Here’s a link to the sales page: True Odds & Value Detector: League Games with H2H History

>>> product specifics <<<

Ordering & Delivery

How can I pay for the course? I have neither a PayPal account nor a credit card.

Details of alternative payment options can be found here: Payment Options. They include Skrill (Moneybookers), Neteller and bank transfer (EFT).

What is the price equivalence in USD?

To find out the exchange rate please follow this link to Google, which gives you the exchange rate of the day.

I live in Hungary; if I understand you correctly, the purchase price is therefore £59.00 * 1.27 = £74.93. Is that right?

Yes, this is correct. Soccerwidow Ltd is obliged in accordance with applicable law to charge Value Added Tax (VAT) on sales of digital products and services to customers within the European Union (EU).

The VAT rate applied to these products and services is based on the location of the customer. See the current EU VAT Rates.

When will my credit card be charged?

Your credit card will be charged at the time your order is placed.

Is it safe to use my credit card on your site?

Yes, it is safe.

For processing orders we use the services of GetDPD which is a fully PCI Compliant Service Provider. During the checkout process you will be offered to choose payment by Paypal or credit card.

If you choose credit card, then the platform integrated with GetDPD is Stripe; here is their security documentation.

Can I cancel my order?

As long as you have not paid there is no order. You can always return to your shopping cart and simply delete any items you don’t wish to see in your shopping cart.

However, once you have paid you will get the product download link delivered immediately to your inbox. As long as you don’t download the course and cluster tables you have a cancellation period of 14 days and the right of a full return. Otherwise, once downloaded, there are no returns for digital content.

If you have made a genuine mistake, it’s worth contacting us to see if you can get a refund. Normally, we will offer an exchange for another product or supply a discount code for future purchases.

How long will it take my order to arrive?

As soon as you have paid you will get the product download link delivered immediately to your inbox.

You will receive an email from GetDPD, our digital delivery partner.

Should your download link not arrive within 10 minutes after purchasing, please check your spam folder. We do sometimes receive reports from our clients that GetDPD emails land there occasionally. You can play it safe and allow within your email program emails with the endings: digitalproductdelivery.com (GetDPD) and soccerwidow.com (us).

‘Allowing’ communications from digitalproductdelivery.com and soccerwidow.com is actually quite important because we do upgrade products from time to time and you certainly don’t want to miss the free download link we will send out to buyers.


Trouble-shooting

When filling out my address details in the shopping cart order form, the field ‘State/Province’ is mandatory. I cannot see states or provinces from my country.

Try pressing the F5 button to refresh your screen. Failing that, clear your cache and refresh again. If the problem persists, please contact us.

I purchased your book but I have not received the download link for the item.

Please check your Spam folder; sometimes our automated emails from GetDPD appear there. If you can’t find it please email to support[at]soccerwidow[dot]com, and we will get it sorted.

My download link has expired. Is a reactivation possible?

The download time limit is set to two weeks from the moment you purchase. The reason being that customers have a cancellation period of 14 days with the right of a full return as long as they haven’t downloaded the product within this period.

Therefore, if you have not downloaded your product, after a period of two weeks has expired you can either apply for a refund or send an email to support[at]soccerwidow[dot]com for a link reactivation.

However, we sometimes get reports that the download link was received straight away but after opening it, a message appears stating that the download is ‘expired’. This is usually a problem associated with your browser. Please clean your cache and press the F5 button to refresh the screen.

Another request we occasionally receive is from buyers who have lost their original product or forgotten to download it, and then many months later wish to reactivate the download link. We are really sorry, but our grace period is 6 months only. After this time a fee of £10 will be charged for us to trace you in the system and manually reactivate the purchase.


Support Questions

I am having trouble at the beginning of the course. I don’t know how to calculate answers to some of the exercises.

Although this is a beginner’s course aimed at people with little odds calculation knowledge and basic Excel skills, it may be quite hard for those who have always found maths quite a challenge at school. Just take your time, read each chapter several times, repeat the practice areas, solve all the exercises, try to understand everything. You will be rewarded with knowledge.

To keep it simple, the course contains no shortcuts. All calculations need to be done manually. Once you master the course and understand everything you will certainly develop a method to make it easier for yourself.

All formulas are given in the course either in the chapter of the exercise, or at the end of the book together with the solutions of the exercises.

If you need help, you are welcome to ask specific questions here on this FAQ page.

Regarding the historical odds you’ve used to calculate the Home/Away quotient – Are these the opening odds of the bookmakers or the odds after adjusting to market conditions?

The course uses football-data.co.uk data. These odds are taken on Friday evenings before the weekend games, and on Monday evenings for the midweek games.

Our approach is to have plenty of time to do all the calculations and make decisions, and totally remove the need to sit in front of the computer just before a game starts. There are loved ones to share time with and lots of other nice things to do than spend time in front of a computer on a Saturday or Sunday morning.

Anyway, if you wish to use opening odds then you would have to adjust the tables accordingly. However, even if the clusters move slightly, there really shouldn’t be too much of a movement because odds don’t change so much that they significantly affect the HO/AO quotient. To play it safe, for fast moving odds you can always use two adjoining clusters when calculating odds.

You describe in the course two different methods to find value bets. Is it true that there are only two options to calculate value? The Value Calculator method and the Cluster Table method?

The course explains two different approaches to find value bets:
(1) Value Calculator
(2) Cluster grouping with HO/AO quotient

In reality, there are many more than just these two methods. However, these two are perfectly adequate, and they both work.

There is nothing wrong with admiring complexity, but solutions should be sought in simplicity. The course provides “simple” answers.

Can I e-mail you with any questions I might have about the course?

Please always ask any questions via the comment functions at the bottom of any article in this blog. You will receive our answer submitted directly to your inbox, with no need for continuous checking. Or see our Contact Us page for more information.

How do I get support?

You can ask questions via the comment functions in any articles on this site. We normally reply within a few hours. The answer will be submitted to your inbox.

In addition, if you subscribe to a post which interests you, then you will also receive questions and replies other readers have posted on the same article, and of course, our replies too.


Ethical Questions

How much do you earn based on your theories? Do you have any statistics for your betting history?

We simply don’t have any ‘theories’. We educate the public about bookmaker maths – bookmakers certainly don’t grow their businesses based purely on ‘theories’.

Regarding how much we earn: Sorry to disappoint, but we don’t like to brag about our personal successes – there are far too many websites already blinding their readers with such information. However, we have published results of our past value betting exploits located in our match preview archive. Here you will find plenty of articles with previews, maths and statistics, and this particular article is also worth pointing out:

Soccerwidow’s Value Betting Results: 274 Bets, from 07/12/2011 to 30/06/2012

2011-12 was a time when we were writing match previews for Betfair Germany based on our ‘theories’. Unfortunately for our growing band of followers Betfair withdrew from the German market in October 2012, and our match previews stopped. Why?

Because we lost our client (Betfair) who paid us for match previews.

Why didn’t we just simply continue publishing match previews on Soccerwidow?

Time limitations, mainly. Writing a single match preview, including all the necessary calculations, takes up to 6 hours. People love reading match previews but they are somewhat reluctant to pay for them…

I keep asking myself if your ‘system’ works so well, why don’t you earn your own money with it instead of selling it?

This is a question that probably interests many readers and it appears in the blog every now and then.

Firstly, the course is not a ‘system’. It is a ‘simple’ maths book (at least for us). A little statistics, a little probability theory, a little about standard deviations, etc. This is what odds compilers do in their sleep when they calculate their odds.

Secondly, there are enough people who teach financial analysis without ever trading professionally in shares. If every professionally trained person would trade, then there wouldn’t be any teachers. And if nobody wanted to teach, what then?

Thirdly, a day has only 24 hours and we too sometimes have to sleep. We run two websites (Soccerwidow and Fussballwitwe). Running these blogs takes an enormous amount of time. Everybody has to make a decision what they want to do in life… We run websites, write courses and develop betting tools. When we have time, we occasionally place a bet or two, but that’s our personal business – betting itself is purely a hobby for us.

In the betting business, in order to win, somebody must lose. Do you consider the moral side of betting, or is it just a numbers game?

The moral side is a very good question…

The intention of this blog is to educate people about gambling. Indeed, to teach them everything they need to know about gambling because our strong belief is that the more educated people are, the more informed decisions they will make.

We truly believe that people who buy our products and read our articles will eventually follow one of two paths:

(1) they will become far more successful punters (winners) than they were, or
(2) they will reduce their betting habit or stop it altogether. There are many qualities required to be a successful bettor and unfortunately, not everyone has them or can/will ever attain them.

If we can point you down either road then this is the achievement we are looking for. It’s our own way of fighting gambling addiction; we help people to better themselves and succeed, or to face facts and shed their habit to save money and free time for family and friends.

>>> buy the ebook <<<



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Stake, Yield, Return on Investment (ROI), Profitability – Definitions and Formulas http://www.soccerwidow.com/football-gambling/betting-knowledge/value-betting-academy/learning-centre/betting-terminology/stake-yield-roi-investment-definitions/ http://www.soccerwidow.com/football-gambling/betting-knowledge/value-betting-academy/learning-centre/betting-terminology/stake-yield-roi-investment-definitions/#comments Tue, 20 Dec 2016 05:25:00 +0000 http://soccerwidow.com/?p=1131 The terms Stake, Yield (Revenue) and ROI (Return on Investment) confuse many people. We have also noticed many online publications using these terms incorrectly.

This article is therefore a definitive guide to put the record straight…

funny man with calculatorImage: hightowernrw (Shutterstock)

Stake

The sum of money gambled on the outcome of an event. The amount of money played with, or placed as a bet.

In the online world of gambling, stakes are electronically placed on a desired outcome with another party that has agreed to accept your stake, whether this be a bookmaker or an anonymous person/group in a betting exchange.

These ‘adversaries’ are effectively backing with their own money against your selection, hoping to make a profit of your stake if your selection in the event turns out to be wrong.

Once the outcome of the event is decided, stakes are returned to you in full if your bet has won (plus the winnings), or, if you lose the bet, the stake is lost and either retained by the bookmaker, or transferred to the winning side in the betting exchange.

Technically speaking, stakes are guarantees! This means that they are short-term deposit payments to guarantee that the losing party can and will honour his debt obligation to the winner of the bet.

Yield

The Profit/Loss* ratio applied to the total capital employed (total staked)

*This is Profit or Loss, NOT Profit divided by Loss

ratio = the quantitative relation between two amounts showing the number of times one value contains or is contained within the other.

Literally translated, the term YIELD means profit, earnings, harvest, income, revenue…

When applied to gambling, Yield measures betting efficiency compared to total turnover.

If your aversion to risk is low, you will select bets with higher probabilities. Bets with higher probabilities of winning carry lower odds. Lower odds means a smaller yield.

If you enjoy higher risk strategies, the opposite will apply.

Generally speaking and depending upon the strategy employed, a good bettor will yield between 5 and 10 percent profit in the long run.

In football betting any yield over 7% is considered to be a very good result.

Yield Formula:

PL divided by ∑MS (written as a percentage):

Yield Formula

PL = profit/loss (MW minus ML = net profit or loss); equivalent to your bank growth
∑ = the sum of
MS = money staked
MW = money won (purely winnings; returned stakes are ‘neutral’, not winnings)
ML = money lost (stakes lost)

Example #1: YIELD

A bettor places 38 bets with stakes of 20 units each. The total amount staked [Capital Employed] is 760 units (38 x 20). 33 of the bets win and 5 of the bets lose; the net result [Profit] is a bank growth of 65 units.

Yield Formula Example

Yield in this example is 8.55%

We come across many forum threads with people talking about their betting strategies; It is also easy to find plenty of websites offering betting systems for sale.

What many of them have in common is claims of high yield results, probably intended to impress the reader.

If they are to be believed then this is an indication of high risk strategies employed.

It must be remembered that in the Yield formula, the sum of money staked (∑MS) includes all stakes, even those that have not been lost. (In other words, the refunded ‘guarantees’).

People tend not to understand this fully and as a result mistakenly overstate their yield results.

Yield is NOT the same as ROI (Return on Investment)!


Return on Investment (ROI):

The ratio of money gained or lost on an investment relative to the amount of money invested. In other words, the profit/loss ratio as a function* for investment (capital employed).

*function = a relation or expression involving one or more variables; in this case, investment, profit, loss.

investment = long-term employment of tangible, financial, or other assets that are not meant for immediate gains but are intended to generate benefits (normally earnings or profits) in the future.

ROI is also known as ‘rate of profit’ or sometimes just ‘return’.

ROI Formula:

ROI Formula

If you bet systematically, your starting capital will be turned over again and again: It is effectively the same money you are investing. (So long as you don’t lose every bet!).

The ROI formula resembles the yield formula, but here, profit/loss is related to the actual investment (starting bank) instead of the total of all stakes (turnover).

For a more accurate ROI calculation, in an ideal world, you should also factor in to the investment all other costs of ‘setting up the business’. For example, hardware/software costs (computers). However, we will leave this out of our calculations for the time being for the sake of simplicity; you can always include these costs once you have mastered the concept. 😉

Example #2: ROI

Returning to our previous illustration, 38 bets were placed, each with a stake of 20 units (760 units staked in total). 5 bets lost but the overall bank growth was 65 units. Let’s assume the starting bank [investment] was 200 units.

ROI Formula Example

ROI in this example is 32.5%

ROI is always calculated for a certain predetermined amount of time; in finances usually for one whole year, but it is also common and acceptable to calculate the ROI monthly or, in a betting sense, for only the number of bets within a specific time scale.

The return on investment index is especially suitable when the amount of capital has a strong influence on the result (e.g. with arbitrage).

However, this is probably rarely the case for the majority of punters. Therefore, it is the next formula, profitability, which is the most important one for the normal bettor.

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Value Betting – Popular Misconceptions & Common Myths http://www.soccerwidow.com/football-gambling/betting-knowledge/betting-advice/value-betting-popular-misconceptions-common-myths/ http://www.soccerwidow.com/football-gambling/betting-knowledge/betting-advice/value-betting-popular-misconceptions-common-myths/#comments Tue, 06 Dec 2016 09:00:17 +0000 http://www.fussballwitwe.com/?p=2746 In many betting forums there are regular discussions and queries about value betting. However, it seems that there are a good number of bettors who believe in myths and indulge false concepts.

Panning for Gold panning - man finding at least a nugget or twoImage: Jeff Banke (Shutterstock)

Here are some of the most popular misconceptions…

(1) Betting on low odds is not worth the effort because winnings are very little

This is absolute nonsense. Successful betting is not about the pay-out of a bet, but the main goal is to make a profit. Very often, especially in the small odds markets excellent value can be found.

In addition, low odds have the huge advantage that they stand for high probabilities and therefore losses are considerably fewer in number than with higher priced, lower probability events. Also, small odds experience shorter losing streaks and the patience of the gambler is never stretched too far.

However, what really matters is the price of the bet.

If, for example, the calculations for a match throw up an 85% chance that there will be under 3.5 goals (corresponding betting odds: 1.18), and the market is offering odds of 1.25 then this is a fantastically good value back bet opportunity.

(2) Betting on higher odds is more profitable

Again this is a very common misconception. Higher odds do not automatically hold more value and are therefore more profitable than lower odds.

Many punters believe that better returns can be achieved in the long run if playing at odds between 2.5 to 3.0. Of course, it is understandable that these bets are quite popular as the potential winnings are 1.5 to 2.0 times the stake.

However, what most gamblers do not consider (or perhaps simply do not know!) is that these betting odds represent chances of 33% to 40% of winning, meaning that on average six to seven out of 10 bets in this group will lose.

Since winning and losing bets are never evenly distributed it may well happen that, with a little luck, a few bets in a row may be won but, much more likely is that many, many consecutive bets will lose until the betting bank is depleted beyond recovery or is drained altogether.

(3) If odds are very low it’s a good idea to combine bets

Accumulator bets are the bedfellow of every bookmaker. Full stop! So far as the bookies are concerned the more people combining their betting choices, the better. It is an absolutely nailed on profit for the bookmaker, and only long-term misery for the punters.

We have already mentioned that bets at very low odds have a pretty high chance to win. There is no question about this. Nevertheless, even a bet with a 90% chance of winning still has a 10% probability of losing. Multiples of bets greatly increase the chances of losing. Only one bet needs to go wrong for a busted flush.

In addition, there is of course the overround of the bookmakers. When combining your bets, you usually have to pick one bookmaker limiting you to accepting their fixed prices. You can be sure that somewhere in the accumulator package you have bought will be bets priced well below their true value. No bookmaker offers best price on every event – if they did they would soon be out of business.

With accumulators you are invariably buying negative value and we have seen throughout this blog that the only way of making consistent profits through gambling is by having value on your side, constantly.

This sermon is therefore to encourage you to avoid multiple, accumulator or parlay bets. You can be sure that the bookmaker is god in this particular arena and the gambler always loses in the long run, guaranteed.

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Sports Betting Course – Over/Under Goals – Product Specifics http://www.soccerwidow.com/football-gambling/betting-knowledge/value-betting-academy/sports-betting-course-over-under-product-specifics/ http://www.soccerwidow.com/football-gambling/betting-knowledge/value-betting-academy/sports-betting-course-over-under-product-specifics/#comments Sun, 20 Nov 2016 05:41:09 +0000 http://www.soccerwidow.com/?p=5601 more »]]> Fundamentals of Sports Betting (Betting on Over/Under ‘X’ Goals) is unlike any other book you will find elsewhere. It contains insights into how mathematics and statistics are applied to bookmaking, information that is rarely (if at all) found in the public domain.

Have you ever wondered how bookmakers set their odds? They must be pretty good at it to remain trading in a high risk industry built on small margins!

Cartoon: Blindfolded people walk precariously close to the edge of a cliffRemember folks it’s all about finding the “edge”.

Image: Cartoonresource (Shutterstock)

It is common knowledge that the gambling industry as a whole relies to a large extent on the ignorance of its customers and, only by understanding how bookmakers think and act, will you ever be able to compete with them on a level playing field.

The Most Valuable Book About Betting You Will Ever Buy!

This course is designed to give you the essential, fundamental knowledge necessary to understand odds calculation and the bookmaker market.

It deals with relatively simple descriptive statistics and teaches you how to look at data sets, calculate your own probabilities and odds, analyse the market odds on offer, and make informed decisions when predicting football results.

Amongst the topics you will work through are distributions, deviations, graphs and charts, odds calculation, financial terminologies, risk management, and of course, how to identify ‘value’ in the betting market.

You will gain a deep understanding of the many different elements required to understand the bookmaker market and odds calculation. Many false beliefs that the majority of gamblers and fans of football have about betting will be exposed and stripped away.

Readers will also be enlightened to learn about how odds are set in the market, where to find ‘errors’ in market prices, how to evaluate data and graphs, and much, much more.

What Do You Get For The Money?

The course comes in electronic format and the bundle includes the course book (PDF*) and a Bundesliga cluster table (Excel) for studying. This course employs a didactic method of teaching, which is an educational technique. It is a very structured style of learning and as such, each section of the course should be mastered before moving on to the next.

To further encourage you to learn, there is a plethora of exercises to practice what you have learned, and the solutions to the exercises are found at the end of the book, sometimes embellished with further explanations.

All of the course lessons are presented in a pragmatic, easy-to-follow, step-by-step fashion, with no more than passing respect towards the sport of football and the passion of its fans. After all, this book has been written by a lady who loves maths but dislikes football…!

In addition, you will receive the very latest Bundesliga table for the current season, so that you can put into practice what you have learned and within the course, you will find a discount code enabling you to download for free the German Bundesliga sheet in future seasons, meaning that you will always have access to the most current Bundesliga cluster table, forever: it doesn’t matter when you bought the course.

*By the way, the PDF is a professionally formatted document and if you have a double-sided printer you can print your own book for studying.

Fundamentals of Sports Betting
Course with Cluster Tables for the German Bundesliga
Over/Under ‘X’ Goals

PRODUCT SUMMARY

Fundamentals of Sports Betting - book cover
  • Format: PDF & XLS
  • Download Size: Course (PDF): 5.2 MB & Excel file: 782 KB
  • Publisher: Soccerwidow Ltd; 2nd Edition (July 2016)
  • Pages: 169 (almost 38,000 words)
  • Tables and graphs: 70
  • Example tasks: more than 80 (with solutions)
  • Language: ENGLISH

Only £59.00*

* 0% VAT to UK customers, 0% VAT to Non-EU customers     Read more: EU VAT Legislation    


>>> read an excerpt from the book <<<



PDF document professionally styled for easy reading and printing

For traditionalists, the PDF has been professionally formatted for double-sided printing. If you like, you can print your book in full-colour with a cover and add slick spiral binding.

Those who prefer to read the document on their computers will find the chosen font (Myriad Pro) easy to read on the screen. Myriad Pro has a clean sans-serif aesthetic which makes it highly accessible.

The electronic version also contains a plethora of easy-to-navigate links to help the learner find his way around the document.

Contents at a Glance

Section A: Basic Knowledge

Probability, Betting Odds, Value, Yield, Profitability

Basic Statistical Terminology

  • Goal Distribution and Percentage Calculation
  • Deviation from the Mean
  • Standard Deviation – The Main Measure of Variability
  • Precision, Trueness and Accuracy

Betting Odds Calculation

  • Probability and Betting Odds
  • Opening Betting Odds Range
  • Calculation of ‘Zero’ (Fair) Odds

Risk Management Control

  • Financial Terms: Yield, ROI and Profitability
  • Risk Forecasting and Evaluation: Value of a Trade (Bet)
  • Preventative Measures: Setting the Starting Bank

Section B: Developing a Betting Strategy

Market Dynamics, Cluster Groups and Betting Tables

Market Dynamics

  • Betting Odds are Prices of Bets
  • Falling Odds represent Price Increase
  • Bookmakers adjust Betting Odds to Public Opinions

Building of Cluster Groups

  • What are Cluster Groups?
  • Clustering Depending on ‘Strength’ of the Team

Betting Tables: Over/Under ‘X’ Goals

  • Goal Distribution by Team
  • Team Calculation Tables
  • Standard Deviation Tables
  • Using Calculation Tables to Determine Betting Odds

Finding Value Bets

  • Everything that Glitters is not Gold
  • Method I: Value Betting using Cluster Group Tables
  • Method II: Value Betting using the Value Calculator
  • Cluster Groups, Value Calculator and Bets Identification


>>> frequently asked questions <<<


…or ask any questions in the comment section below.

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Over/Under Goals Football Betting – Course Book Testimonials http://www.soccerwidow.com/football-gambling/betting-knowledge/value-betting-academy/over-under-goals-football-betting-course-book-testimonials/ http://www.soccerwidow.com/football-gambling/betting-knowledge/value-betting-academy/over-under-goals-football-betting-course-book-testimonials/#comments Wed, 20 Jul 2016 09:26:33 +0000 http://www.soccerwidow.com/?p=5606 more »]]> We are very pleased that the 2nd edition of our comprehensive betting course Fundamentals of Sports Betting (Betting on Over/Under ‘X’ Goals) is now available for sale. It incorporates four more years of research and development and replaces our old flagship version.

Do you know how bookmakers set their odds? We do! And we will happily teach you too!

Cartoon: Maths! Why did it have to be maths?!Image: Cartoonresource (Shutterstock)

the upgrades at a glance

The 2nd edition is not just a ‘revised’ version, it is a total overhaul answering many questions raised by our original audience such as deviations and correction factors, which are explained in great detail.

The updated version is now a hefty document at 169 pages and almost 40,000 words, three times the length of the first course.

One enormous enhancement is that in this new version, we actually give away two proven methods of bet selection, making it as easy as possible to spot candidates for successful value betting portfolios.

Another substantial upgrade is that buyers of the 2nd edition will now automatically get the current, up-to-date German Bundesliga cluster table supplied with the course. In addition, you will find a discount code within the course enabling you to download for free the German Bundesliga sheet in future seasons, meaning that you will always have access to the most current Bundesliga cluster table, forever: it doesn’t matter when you bought the course.

What Customers Say

Attila

The course is really very well done! Concentrated expertise that cannot be found anywhere else.

Socrates

Finally an unbiased contribution to football betting, which goes beyond a simple description of betting options and also explains bookmaker calculations as well as betting odds formation in detail.

What really surprised me is how easy it actually is to calculate odds and even predict Betfair market prices to find value bets. However, I will still need a long time to work through the entire course, but now I have some guidance about how to change my betting behaviour.

Onheimlech

Hello Soccerwidow,

Your course is written very well. My bet portfolio now considers mathematical formulas and somehow I like this.

It is amazing to see how close my own calculated odds come to the actual odds for different bookmakers. Without your course I wouldn’t be able to find value.

André

I just working through the Over/Under X Goals course.

The examples described are simply fabulous. When I look back and see what I have previously evaluated and what is recommended by you – they are worlds if not galaxies apart.

Marcel Brand

Dear Soccerwidow,

Firstly many thanks for the great Over/Under Goals course. I would already personally call myself an advanced bettor, but your course has brought me further forwards, especially in the topic of cluster grouping.

Pete

Just bought your guide, and learned a lot. Many, many thanks! I can recommend it.
Worth every penny!

Ian

I’ve just purchased the Over/Under course and Value Bet detector. They are both excellent products and bring together all the knowledge that I have accumulated over a few decades.

Unfortunately, it has taken me this long to figure out the simple fact that value bets + staking plan = steady profits 😉

Janice

When I bought your course I was completely overawed by it and didn’t read it properly for a couple of months – in fact I stopped betting altogether…

But when I had nothing to do one day I re-opened it, gradually overcame my fear, and began making some satisfying progress.

The exercises and questions really are a great idea and help to commit the concepts to memory, and having the answers provided at the back of the book is hugely reassuring, especially when you get them right.

>>> product specifics <<<

what level of education does the course provide?

The course Fundamentals of Sports Betting – Over/Under ‘X’ Goals explains statistical applications required to calculate odds and find value in the market.

All the concepts explained apply basic maths, financial management, quantitative analysis, and statistics to football betting.

The course reinterprets maths covered in A-levels at school (such as analysing graphs, calculating the mean, etc.), and also introduces some statistics from the first year of university studies (e.g. standard deviation).

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What is Value? What is Value Betting? http://www.soccerwidow.com/football-gambling/betting-knowledge/value-betting-academy/learning-centre/value-betting-definition-concept/ http://www.soccerwidow.com/football-gambling/betting-knowledge/value-betting-academy/learning-centre/value-betting-definition-concept/#comments Thu, 31 Mar 2016 09:00:52 +0000 http://soccerwidow.com/?p=4084 more »]]>

Value betting is a phrase used to describe an approach to gambling for long term profit. Although this term is widely employed in the sports betting world, unfortunately neither ‘value’ nor ‘value betting’ are anywhere clearly defined, which naturally leads to misunderstanding and confusion.

Smart smiling business woman with a calculatorImage: Kristo-Gothard Hunor (Shutterstock)

When people talk about ‘value’ in connection with betting there are many different schools of thought.

This article therefore attempts to shed some light on this complex concept and its terminology…

Firstly, let us begin with a few synonyms for the word ‘value’: worth; usefulness; advantage; benefit; gain; profit; amount; rate; price…

You can see straight away that there is a plethora of different connotations.

The last two meanings in particular, ‘rate’ and ‘price’, are probably the reason why the expression ‘value’, when used in the context of ‘value betting’ is often unclear.

So, what is Value in relation to Sports Betting?

In order to really understand the concept of ‘value betting’, you need to grasp several connected aspects and I will tackle each of these individually for better comprehension.

Tip: Grab yourself a caffeine shot and read every section (re-read if necessary) until you are comfortable enough to proceed to the next. What I am about to say may initially be hard for some to digest, but don’t worry, you will certainly not be alone. Headache pills may be advisable for some… 😉

(1) Betting Odds are solely the Market Prices for Bets

Anyone interested in sports betting knows that bookmakers offer bets on a multitude of match outcomes and sometimes the list of available bets on a single event can appear endless.

For example, the 1×2 market allows you to bet on a home win, a draw, or an away win, either at half- or full-time. Will there be more than two goals in the match or not (over or under 2.5 goals), will both teams score, or will the match end goal-less? Et cetera, et cetera…

Only very few bettors fully comprehend and understand the fact that betting odds are nothing more than the market prices of bets.

Betting Odds are Prices that Few Understand

Betting odds are not only all-inclusive prices for bets but to add to the confusion they are displayed, not in simple and easy understandable monetary units, but in different formats such as decimals, fractions, or moneyline.

When buying a bottle of beer, for example, you pay one Euro, Pound or Dollar and walk home with your purchase. When buying a bet, say, at decimal odds of 1.27 (27/100 Fractional Odds; -370 U.S. Money Line), the only thing you may understand is that if the bet wins you will receive your stake money back plus 27% winnings. Of course, if the bet loses all of the stake money is forfeited.

Judging ‘value for money’ from a bottle of beer is far easier than evaluating the same in a bet. Many bettors struggle to calculate the expected return of a bet or a series of bets let alone analyse why the big win they hoped for failed to materialise.

Even if sports betting odds appear to be genuine offers, the fact is that odds are frequently distorted.

Betting Odds cannot be priced by Gut Feeling or Intuition

Very few people are born with a sense of probabilities and ratios. Statistics and financial education are rarely taught in high school and touched upon in very few university courses.

To develop a ‘feeling for price’ is impossible, even for those of us who are born with a sense of probabilities.

To make matters worse, every bet is actually a different product, even if betting on just one particular type, for example, the “over 1.5 goals” market. Think about this bet in the context of a match between two evenly matched teams as opposed to, say, the team at the top of the table playing the weakest team in the league. The name of the bet is still the same but the two match situations are totally different.

There is no way but applying maths and statistics to decide whether the price of any bet offered is “too expensive” or “too cheap”. Gut feeling is misleading and may prove fatal. Probabilities are a subject too complex to succeed with guesswork, feeling and intuition alone.

For those of you who are really serious about understanding sports betting in depth and developing a value betting strategy, there really is no alternative to learning the calculations necessary.

In order to grasp the concept of value it is of uttermost importance to comprehend that betting odds are merely prices, and not ‘true odds’.

Before I address the term ‘value’ I must first plunge into probabilities… please stay afloat!

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How to Calculate Losing Streaks & Optimal Bankroll http://www.soccerwidow.com/football-gambling/betting-knowledge/betting-advice/money-management/how-to-calculate-losing-streaks-optimal-bankroll-sport-betting/ http://www.soccerwidow.com/football-gambling/betting-knowledge/betting-advice/money-management/how-to-calculate-losing-streaks-optimal-bankroll-sport-betting/#comments Mon, 21 Dec 2015 14:49:07 +0000 http://soccerwidow.com/?p=5401 more »]]> In this article we will teach you to determine how large your starting bank needs to be to avoid bankruptcy by calculating the longest losing streaks that can be expected from your chosen betting strategy.

What is Bankroll Management?

Bankroll management is one of the most important pillars for success in sports betting.

Dollar notesImage: Alex Roz

A portfolio of sports bets placed over time can be compared to investing in the money markets on a portfolio of stocks and shares.

Indeed, the term ‘bankroll management’ comes from the financial sector and describes the use of the seed capital (i.e. in betting terminology, the initial stake).

Bankroll is the ‘starting bank’, and the intention is to manage it and increase it at the same time.

Bankroll management therefore deals with how to properly manage your starting bank.

The Continual Importance of Statistics, and Lots of Them!

The good news: It is actually possible to calculate the required starting bank mathematically.

The bad news: The calculations are naturally dependent upon statistics, and the ‘significance’ of the results relies on the amount of data used.

For example, any strategy based on one German Bundesliga team’s home games during a season produces a sample of precisely 17 sets of data, which is a very small number, statistically speaking.

The Law of Large Numbers is omnipresent so far as statistical accuracy is concerned: The larger the data sample, the more accurate the final results are likely to be, although a line has to be drawn between sample size and an acceptable level of error.

One way of coping with small data sets is to incorporate a risk discount into the equation. More about this later…

What does ‘Optimal’ Really Mean?

On face value, you might assume that calculating the necessary starting bank for a betting strategy can be derived solely from the stake multiplied by the number of bets (n).

With the 17 matches from our example above, and a constant stake of 100 units per bet, the bank would then be: 100 x 17 = 1700 units. But is this maximal amount really needed?

Although this may be true where returns from winning bets cannot be immediately re-invested, such a bank can never be optimal because an inordinate amount of capital would be tied-up.

What you should look for is the most cost-effective bankroll where all the money you have at your disposal is working for you as efficiently as possible.

Optimal bankroll is characterized by two things:

  • Cash holdings (i.e. money in reserve) is kept as low as possible
  • Gambler’s ruin is avoided


Calculating the Optimal Bankroll

There are five vital criteria you will need to establish:

  1. What is the size of your stake per bet?
  2. How many bets does your strategy expect to be placed?
  3. What is the expected hit rate of your strategy?
  4. What is its expected longest losing streak?
  5. Determine the risk variables and incorporate a ‘risk coefficient’.


Example Calculation

Okay, we will stick with the German Bundesliga for demonstration purposes and use a system gleaned from its latest full-time 1×2 HDAFU Simulation Table.

If you have already bought this table, you can see the full and detailed analysis of backing the underdog whenever Hamburg plays at home: This strategy has realised a yield in excess of 58% over the course of five complete seasons from 2010-11 to 2014-15.

In addition, there has been profit produced in every one of those same five seasons.

It’s an ideal candidate for incorporating into a large portfolio of other systems. (When we say ‘large’ we mean a portfolio that will generate at least 500 bets in a season.)

Remember the five criteria:

(1) Size of Stake per Bet:

This is determined by your own liquidity, and to keep this calculation simple, a Constant Stake (CS) of 100 units per bet will be used.

(2) Number of Bets:

For this mini portfolio of Hamburg home games, the Number of Bets (n) is 17 for the new season.

(3) Hit Rate:

The HDAFU Simulation Table reveals that from 85 Hamburg home games over five seasons, 32 underdogs triumphed: a Hit Rate of 38%.

The random selection of only 85 matches is a relatively small sample and the possibility of ‘random sample error’ is therefore relatively large.

To compensate, it is worth applying what is known as a ‘risk discount’ to reduce the actual hit rate experienced and to build-in an extra level of security if statistical expectations for the new season are not realised.

Taking a risk discount figure of 5%, the expected hit rate becomes: 38% – 5% = 33%.

[Have a look at this article for more information about hit rates].

(4) Longest Losing Streak Expected (LLSe):

The longest expected losing streak (or winning streak) can be calculated using the following formula:

Formula longest losing streak

n = number of trials (i.e. total number of bets)
ln = natural logarithm*
P = (negative) probability
| .. | = absolute value or ‘modulus’ (see Wikipedia if you would like to know more about these mathematical symbols)

*Suffice to say, explaining what natural logarithm is would be worthy of a series of articles. For the time being, use Excel to calculate this for you: to make life easy, the formulas to use are included in the free spreadsheet download below.

For this calculation, the negative probability or hit rate is used. In this case, having adjusted our hit rate down to 33% using a risk discount, the probability that the bet loses (negative probability) is 67%.

LLSe = |(ln (17) / ln (0.67))| = |2.833213344 / -0.400477567| = 7.07
rounded down to 7.00

From a pool of 17 bets, you can therefore statistically expect that a maximum of seven in a row may be lost without winning one in between.

(5) Risk Coefficient (RC):

The determination of risk variables depends primarily on your risk aversion. Risk-averse bettors choose a high coefficient figure (e.g. 5), whilst gamblers who are happier taking risks choose lower coefficients (e.g. 2).

But why are we including a risk coefficient at all?

We can assume that the longest expected losing streak (in our example, seven lost bets in a row), may already start with the first bet.

Although one bet may win after that, with the gains reimbursing the loss and allowing for reinvestment, there can still be a second stroke of bad luck directly after the first bet that you have won.

Neither winning bets nor losing bets ever line up in a uniform manner; they will always appear in a random pattern, so always better to be safe than sorry.

Optimal Bankroll Formula

The formula is:

Optimal Bankroll = CS x LLSe x RC

Our Bundesliga example is an underdog backing system, which by its very nature, is risky. However, as there are only a maximum of 17 bets in this mini system, we will choose a risk coefficient of 1.5: we are happy to take the risks!

It is not very likely that there will be two losing streaks of seven games in a row when betting 17 consecutive times. However, we are aware that it may be quite challenging for the nerves to sit through losing streaks watching the bank balance reduce before your eyes!

The optimal bankroll required to run this system for a season is as follows:

100 units x 7 LLSe x 1.5 RC = 1,050 units

If you remember the sub-optimal bank strategy at the beginning of the article where we touched on a bankroll of 1,700 units (100 units per bet x 17), you can see we have now released 650 units for investing in another strategy elsewhere.

Calculate Your Own Longest Expected Losing Streaks & Optimal Bankroll!

With this free Excel table download, you can easily and quickly discover what the longest losing streaks are for your own strategies. Just enter your stake, number of bets, and risk coefficient figures and let it calculate everything for you!

>>> Excel Workbook – Losing Streaks <<<

 
 Click on the above button – in the new tab click on the ‘Continue Checkout’ button. Enter your name and email address to allow our automatic shopping cart to deliver the file by email to you, free of charge. The .xls file size is 93 KB. When you receive your confirmation email, just click on ‘View Purchase Online’ (in the email text) to download the file.

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