With a recent influx of gambling companies, matched betting in the USA is becoming a reality. Access for the US audience to these new companies also opens other opportunities, albeit, this is a more intensive way of making a living through arbitrage betting. With matched betting, we simply leverage free promotional bonus bets, then hedge this bonus bet on another bookmaker and take the profit without risk. Very simple, a nice easy cash injection, however, the bookmakers give you a very limited amount of bonus bets, obviously they just use them to entice you to sign up.
So after we have turned the bonus bets into cash through arbitrage on two bookmakers, we will want to find a more sustainable way to make a profit with arbitrage betting on the bookmakers. This is more akin to trading than matched or arbitrage betting, so it takes a real time, effort and investment commitment to make it work.
There is however another way to make a living out of the bookmakers without the same risk that is involved in gambling. This is called Value betting. When you first hear of it, it can sound a lot like regular old fashioned gambling, rigged by the bookmaker so that you are guaranteed to lose over a long enough period of time.
If you’re willing to put the work in, it might just be a game charger for you, lets dig into how value betting works.
Value betting in the USA
Value betting in the USA is the best way you can beat the bookmakers at their own game. Coupled with matched betting and using bonuses and promotions for an extra edge, this can be a winning formula.
Since the change in the rules around online sports betting with PASPA in 2018, followers in the USA should be prepared for a huge growth in online sports betting over the coming years.
What does a value bet mean?
To prep you, this might sound very difficult to get involved in without having experience, rest assured that it’s easier that it sounds to get involved with the use of a few very clever tools.
Value Betting must be thought of like day trading, treated like a business. With all the third party tools available to us, the math, value finding and statistics are actually the easiest part, even if you are terrible at these things.
The hard part, similar to trading, is to get our biases and emotions out of the equation. We need to remove as much human bias and emotion from our decisions and replace it with data and statistical models and rigid risk management.
There will always be variables that we miss even with this information, so just like trading, risk management is the most vital part of all. Stay in the game long enough to win and make sure we can handle the variance.
We need to understand the statistical probability of an outcome happening and then find bets that are not aligned with this probability. (There is software for this, don’t worry). “The house never loses” Well it does, it just rigs the odds vs probabilities so that it wins more than it loses. The best example is the roulette wheel.
By the term value bet we simply mean, if a statistical probability of an outcome does not match the odds assigned by the bookmaker to this probability. For a crude example, if the bookmakers gives us +200 odds on a coin toss, this will mean that each time we get this choice correct we will turn our $1 into $2, but each time we get it wrong we will lose $1.
This discrepancy will put the odds of this bet in our favor. We may still lose that single bet and choose the toss wrong, the second time we may lose again. So we would be down $2, if this is out total assigned budget we would be broke, however if we had enough of a budget to play 100 times, we will know that statistically after 100 coin tosses, we should be looking at around 50% head and 50% tails. This will mean on average we will win 50 times and lose 50 times.
50 wins = $100
50 loss = $50
Total profit = $50
It wont always end up exactly 50/50 after 100 tosses, there is always some variance that you need to consider, you might be really unlucky and lose the first 10 coin tosses. However given enough time it should revert back close the statistical average of 50/50.
So with this in mind you need to divide you budget into enough little bets to make sure that you can play the game long enough so that the statistical law of large numbers comes into play.
Risk management is key
We need to take all emotion and compulsion to gamble out of the equation. Divide out investment into say 1000 small segments. Then with each value bet I find, I assign a number of these small segments to the that value bet depending on how favorable the odds vs the statistical probability of the outcome.
You want to stay in the game long enough so that over time the odds being in your favor each time you play will benefit you. You will win some, and lose some, but if you only choose to play when the odds are in your favor, over time will statistically come out ahead.
The best sports betting traders are able to methodically understand the discrepancies between the odds assigned to a certain outcome and the probabilities of it happening. In fact, this is how both bookmakers an casinos never lose over time.
There is lots more nuance to this and luckily you don’t need to be a statistic or sports betting expert to benefit from this
Understanding Probability vs odds
Do not think in favorites and non-favorites, only in probabilities
Probability a percentage assigned is how likely an event is to happen . All the way from 0% (not possible) to 100% (guaranteed). Bookmakers figure out the probability of the event happening and turn it into odds, which they then offer the public, however, usually skewed in their favor, otherwise they would not be in business long.
However they don’t always get it right, and they also offer value in the for of promotions too. The times the odds are not in their favor are the only bets we seek out and play. We can beat them at their own game.
Value bets occur when the odds are not and accurate representation to the probability of the outcome happening.
Our job is not to look at odds offered by a bookmaker and judging that their favorite selection is under or over valued, it’s to use Don’t get a rush of blood to the head and bet half of your stack because you’re drunk somewhere watching the game. This needs to be ran like a trading business to be successful.
Find these value bets and expected value explained (EV+ EV-)
Expected value is basically the model that is use to explain if the value bet will return a positive return over time or a negative return over time.
Even a negative EV bet can win a lot of times, but over time, statistically, if the estimated value of this bet is negative, you will end up more losses than wins over the long term, statistically speaking, so we only want to find and play bets that have a EV+.
You may lose some bets in a row, but by playing only +EV bets and the correct risk management strategy to be able to stay in the game long enough and not blow up your trading stack, over time, you will end up with more wins than losses, this is why it’s so important to have the correct risk management strategy in place so that you can handle a few losses.
Generally speaking, the more times we can place this bet, the closer we will get to the outcome of the either positive or negative EV. Like our above coin flip example, we could lose 10 in a row, with a probability of 1024 to 1, but to lose 20 in a row would be extremely unlikely, so with our 100 flips,
we weather a bit of variance and the results come back to the average expected value of the coin toss.
This is called the law of large numbers for further reading.
Finding value bets, risk management and probabilities.
There is a company that does all of this and they are keen to get people to try out value betting so they are offering a free 7 day trial.
You can get a good feel for how well suited you would be to give this a shot and to understand how it all works. If you do not make a profit in your first month they will also give you the 2nd month completely free. A Norwegian company that has been successful with their software has come to the USA.
Trademate USA Value Betting
- Trademate US: For US sports betting with American Football, Basketball, Baseball & Ice Hockey. You can build your bankroll here and then move onto the Asian markets 49/month or $125/3months
Which US bookmakers can I use this with?
Even if you can’t access them all, you should be able to do at least a few. Unibet, 888Sports, Bookmaker.eu, William Hill, Bet365, Fanduel, Draftkings, intertops, Betcris, and 5dimes.
How Trademate US Works
How much bankroll do I need to begin value betting?
Trademate US says;
The minimum recommended starting bankroll is €1,000 (this is to cover the variance we mentioned earlier and to see worthwhile results over time) One should start with a higher bankroll and it is highly recommended to spend at least 10 hours a week trading. This could be heavily skewed towards the weekend when there is a lot of action on.
The Trademate US only option doesn’t include their Analytics Tool but as long as you satisfy “Place 500 trades in your first month or 1,000 trades in the first 2 months” you will get their analytics tool for free for a month. So start when you are committed to giving this a real shot.