New sports betting trends are arising, with the potential to reshape sports betting. The United States of America have started to change sports betting regulation across the country. Big Data is piercing the industry quickly. Sports betting experts are changing their approaches and strategies. In Betmarkets, we have been paying close attention to these shifts, and also started to implement preemptive measures accordingly.
Sports betting has been deemed as one of the 21stcentury incredible investments. However, understanding that it is an “ever-changing landscape” is mandatory to prosper in it. Recently, we came across some very interesting articles on the Sports Betting Trends of 2019. You can find them here and here. After giving them some thought, we decided to explain to you how we have been tackling these issues. Some of which are part of our value proposition (like automatic bet replication). Some others were early risks that we decided to take (esports). The remainder betting trends are disruptive waves that we are now preparing ourselves for.
1. Sports Betting Deregulation in the USA
Well, what happens in Vegas no longer has to stay in Vegas.
Striking down a 1992 federal law that impeded sports betting in most places, in May of 2018, the U.S. Supreme Court laid the groundwork for states across the USA to legalize sports betting.
For a long time, sports betting in the US meant a road trip to Las Vegas, Nevada. Ever since May 2018, across America, people can now bet on sports. The image below is credited to ESPN. In it, you can check the states in which you can now place a bet.
Deregulation will expose the USA to market improvements. We predict that the betting market will become more efficient. As the process develops, the amount of information available in the market will increase, as will the speed at which it will circulate. The overall Sports Betting growth rate is, thus, expected to increase.
Less Regulation = More Information
The US Deregulation has the potential to be extremely disruptive. Certain American sports, like basketball, baseball, and hockey, are already big sports betting markets. Deregulation will further increase liquidity levels in such markets. This will result in sharper odds (i.e. smaller odds). Hence, in theory, the closing odds will be much closer to the real probability.
On the one hand, increased liquidity grants the betting provider the same absolute level of profit. Thus, the spread charged by some houses will be reduced. On the other hand, market information will proliferate, leading to more trustworthy predictions by the bookmakers. This is, fundamentally, more beneficial for the bettor. He/she will have access to information that is closer to the real probabilities. Consequently, he/she can make better decisions, thus resulting in a more efficient market.
As an example of this, let’s take a look at NBA’s two new subscription programs on their NBA League Pass. The first one, introduced in 2018, is a 1.99$ streaming subscription program that allows fans to see the final quarter of a game. The second one, announced in early 2019, is a 10-minute view pass. These services may be useful for people who can’t watch the full game. However, they are a particularly good deal for bettors who want, during the game, to bet live on critical moments.
Finally, some states that change regulation around sports betting, do not have casinos or race tracks. In our opinion, their decision sends a clear signal that digital sports betting platforms are viable. This represents another opportunity for the appearance of different sports betting related business models in American soil.
2. Big Data and Sports Betting
Sports analytics has reshaped the way athletes play the game and fans interact with it. In tennis, coaches and athletes can now use advanced Tennis Analytics to predict what a player is most likely to do, based on things like a player’s strength at any particular time, past results, his first-serve, and second-serve points and the strength of his opponent. Football clubs can now run complex algorithms to gather prospects about the number of expected goals that potential hirings could score. Data is transforming sports. So, why wouldn’t it change sports betting as well?
Prediction, valuation and other Big Data betting trends
Big Data is making its way into sports betting at a very fast pace. Some players in the market have already started to develop prediction models that are adaptable to both individual and team sports. Yet, we still believe that human input is of extreme value, particularly in the latter case. Let’s take it back to tennis and football. In tennis, each athlete acts alone. In consequence, the data can quite effectively predict the effect that an injury can have on a game. However, the injury of one particular player, within a team structure, represents a fault within the databases used for the prediction models. There won’t be enough data about that specific player being injured and all the consequences that circumstance represents for the team. These are the sports betting circumstances in which human input will still be fundamental.
Following these betting trends, some sports betting experts, with a Data Science background, have already implemented models that rely on Big Data to tell them when and how much to bet. Nevertheless, it seems reasonable to assume that sports betting won’t go fully digital in the foreseeable future. Sports betting involves a lot of emotional betting. And we believe machines are not (still?) really prepared for that.
3. From Arbitrage betting to Value betting
“I couldn’t find any value with these teams”. How often have you heard this? Well, if you are an active member within the sports betting sphere, probably a lot. That is because of the shift sports betting experts are operating. They are turning from Arbitrage betting to technical Value betting.
Arbitrage Betting is a complex move. Simultaneously, regardless of the result of the event, you place bets on all outcomes of an event on different betting providers, at odds that guarantee a profit. It’s a betting system that guarantees profits despite the outcome since it allows a customer to place multiple bets on different betting providers. Yet, the difficulty lies in understanding how to spot the discrepancy between odds and how to take advantage of it. When pricing a market, betting providers usually always factor in a spread. That being said, the probabilities computed from the odds of all outcomes add to more than 100%. However, by using different providers, you might catch events where that sum is less than 100%. You can grab a negative spread there and ensure a riskless profit. And that is Arbitrage Betting.
Compared to Arbitrage betting, Value Betting increases the volatility of the bettor’s returns. Yet, he will be rewarded for the extra risk he is exposed to. A value betting situation is one when a particular bookmaker presents you a probability smaller than the real probability of the event occurring.
Consider the following example. Team A is playing with odds of 2.5 to win. That means that this particular bookmaker is telling you that Team A has a 40% chance of winning. Now, we have done our research and studied the market. Our predictions are that Team A’s real probability of winning is 60%. That means that the odds should be 1.66. In this case, you calculate the value as follows: (0,6 * 2.5) – 1 = 50%. This team had a 50% value.
On a day-to-day basis, this incongruity is one of the few things our sports betting experts are trying to explore.
In Betmarkets, we have been trying to forecast some of these betting trends. It is curious to examine the effects that each of them could potentially have independently. But we also need to know how they intersect each other, and the consequent influence that derives from it.
We eagerly await to see the impact the US deregulation in sports betting will have on the way experts explore value bets. Yet, considering what we have put forward before, it seems to us that the wagers placed by bettors as well as the odds at which events will close on the major American sports will, for sure, change the way how experts operate. Most likely, they will be adapting their strategies to these market adjustments, since they like to work on inefficiencies – that is, essentially, what a value bet is. Furthermore, efficiency rates will also increase with the introduction of Big Data based Sports Betting Prediction models.
We are still not certain about the impact these betting trends will have. Nonetheless, it seems pretty sure to us that they will come. And our experts operating on US sports need to be aware of that. Sports betting is a market where emotions still play a crucial role in decision making. In result, we believe that our experts will still be available to pursue value betting which has, so far, proven to be a profitable strategy.
New sports betting trends will emerge down the road. We are very positive about what is to come – and we couldn’t be more grateful for having you guys joining us for the ride! For those of you that have not yet registered, be sure to do so. Don’t forget to use the code BM252 to receive a €20 bonus to invest in our platform during our Beta version. No deposits are required, and you get to keep all profits as credit towards future fees (eventual losses are all on us). The initial bonus will be removed from your account once the Beta version ends.