How Sportsbooks and Bookies Profit
Sportsbooks generally profit by taking an equal amount of bets on both sides of a game. This means that they look to get the same amount of money bet on one team as the other team. The fee for taking the bets is either the difference in the money line or the vig in the spread (-110). This is where sportsbooks and bookies make their profits.
For example, Baltimore is a 5 point favorite over Miami. The Spread would be Baltimore -5 and Miami +5. In order to bet either side, a player must be willing to risk $11 to win $10. By taking an equal amount of bets on each side, the sportsbook is in effect charging the players betting the losing side an extra dollar. When the game is over, and lets say Miami wins, a player who bet $10 on Miami gets bet $21 (the $11 risked and the $10 won) while the player who bet on Baltimore loses $11. The sportsbook then makes $1 on this transaction, the $11 lost by the Baltimore backer less the $10 won the Miami bettor.
Most people think that this is how bookies profit too, but in reality bookies often use several different methods to increase their profits above and beyond the $1.
Many local bookies may shave points to increase their odds. Shaving points is when the bookie knows that one team is going to get more bets than the other. Let’s say you live in New York and the line national line on the Giants is -3. Most likely if you tried to place a bet with a New York bookie, he’s spread would be -3.5.
The same is true for money line bets. Again you are in New York and want to bet the Yankees. While they may be favored nationally and the money line is -180, a New York bookie might charge you -240.
Bookies also shave points against the favorites simply because more players are known to bet the favorite than the underdog especially for big events such as March Madness or the Super Bowl.
Additionally, bookies may begin to remember certain players and adjust the line for each individual. If a bookie begins to notice that you always bet a certain team or never bet unders, they may begin to adjust there lines just for you in order to give them an added advantage. This means that 3 other players may have the Giants over 45, but because the bookie remembers you, he tell you line the is 45.5 knowing that you will most likely bet the over and not the under.
Parley Cards: Many local bookies also offer parlay cards to their clientele. These cards are offer the spreads on all the weekend’s games, and a bettor must pick at least 3 games in order to bet. These cards work as a normal parlay except that the payouts are far that from sportsbooks and even farther from the true parlay odds. While most bettors don’t bet much on these cards, bookies profit heavily from them. Additionally, some bookies shave points on these cards to protect themselves. This is when a team is favored to win by 3, but on the card the spread is -2 or +4. Now if the game is decided by 2 to 4 points, it’s considered a push and the players winnings are lessened by that 1 game.
To see more about parlays, check out Sports Betting 101 – Types of Bets
Making the Spread
The spread is created and originates out of Las Vegas. Las Vegas Sports Consultants is the primary provider of sports betting lines. This company attempts to put themselves in the shoes of the sports bettor to create a line that will get an equal amount of action on both sides of a bet. Factors they consider are power rankings, location, injuries, trends, public perception, weather, and current history/streaks.
Today all analysis is run through formulas to determine the spread. In football, the next week’s spread is released after the last game on Sunday. In basketball, baseball and hockey, lines are usually released overnight.
Power Ranking: The power ranking is used to create the original spread. If one team is ranked higher than the other, this team will initially be favored.
Location: A team is given points for playing at home. This can be about a 3 point move in football depending on the opponent. Factors to consider are natural grass teams, dome teams and climate.
Injuries/Starters: Player injuries are considered. A injured quarterback is considered a vital part of a team and could adjust the line 3 points while an injured linebacker may not move the spread at all. In baseball, starting pitching has a strong influence on the line and is considered in the power rankings.
Trends are important in rivalries when one team historically beats another and the line is adjusted accordingly.
Public perception is considered when the betting public likes to bet on one team or against another. Points may be added to public teams (i.e. New England Patriots) or against unpopular team (i.e. Kansas City Royals).
Weather is considered for outdoor games. In football, bad weather is considered to favor home teams, strong defense teams and under bets.
Current history: When a team is hot, bettors tend to follow it and the spread is adjusted accordingly.
Sportsbooks generally profit though taking equal action on both sides of a game. This means that they look to get the same amount of money bet on one team as the other team. The fee in taking the bets, either the difference in the money line or the vig in the spread (-110), is where they make their profits.
Line movement is essential to sports betting. It is a game that begins immediately after the line makers create the opening line (or virgin line).
The spread opens in Las Vegas and on the internet. This is when the game begins. Handicappers immediately start betting spreads that they see as weak. If a line is 3 and these early birds think that it should be 6 or 7, they will bet the favorite fast and hard.
Sportsbooks don’t hope for, but expect, this early action to help firm the line. If this action is equal on both sides, the line is good and will not move. If the action is bias to one side, these handicappers will continue to bet it until the line is corrected or until they have reached they’re limit of risk on that particle game. During this time, the line correction comes fast as the sportsbooks will adjust the spread on these early lines until they get equal action on both sides. A spread may move from 3 to 3 ½ to 4 to 4 ½ before there is an equal amount of bets coming in on both sides. Once the line is firmed up, it will not move much until game time, but it still can.
In football, sports bettors have a whole week to bet on games. This is a week in which new information becomes available daily. Sports Illustrated puts a team on their cover, injury reports are released, weather reports become more accurate, and paid handicappers release their picks to the public. All these things (and more) have an influence on the sides (and the over/unders) that are bet.
Similar to the opening line, if sportsbooks receive more money on just one side of the spread during the week, they will adjust the line. This is a much slower process as bets come slowly during the week, and sportsbooks don’t like to move the line once it has been set originally. Unless a team has a major injury or venue change, the spread should not move at this point 95% of the time.
The last period is which the line can move is on game day. Big bettors that did not hammer the opening line often place their bets a few hours up to 15 minutes before game time. These players come with a lot of money and want to get the most accurate information available before the game starts. They don’t have to depend on inaccurate weather or injury reports as they can see what is happening that day. This last minute action can be large enough to move the line right up until game time.
As you can see, the spread can move at any time, but the movement is much slower during the week. Early and late line movement is mostly attributed to action coming from expert handicappers while line movement through out the week is most probably due to public money. Once the game starts, the betting is closed and the line set.
Parlay Sportsbook Odds and True Odds
A parlay wager is a bet on two or more games that pays higher odds than betting on the outcome of both events. The drawback is that the odds aren’t right and that if one selection loses the whole parlay is a loss.
|Number of plays
The more events parlayed, the worse the odds shift in the casinos advantage. The advantage to the sports bettor is that parlays give you leverage to win more money on two teams who are playing at the same time.
Teaser Sportsbook Odds
A teaser bet is a bet on two or more games that allows bettors to adjust the spread. These bets are available for football and basketball. See the different odds below:
|Number of Teams
||11 to 10
||10 to 12
||10 to 13
||9 to 5
||8 to 5
||3 to 2
||3 to 1
||5 to 2
||2 to 1
||5 to 1
||4 to 1
||7 to 2
||7 to 1
||6 to 1
||5 to 1
||10 to 1
||9 to 1
||8 to 1
||15 to 1
||12 to 1
||10 to 1
||20 to 1
||15 to 1
||12 to 1
||25 to 1
||20 to 1
||15 to 1
Football spreads can be adjusted between 6 and 7 points, and basketball bets can be adjusted between 4 and 5 points.
Sports Betting Terms
Action – A wager or bet of any kind; having action means having a bet.
Against the Spread (ATS) – To bet against the spread is to make a wager that will be decided by adding points to one team or the other after the game is played.
Agent – A middleman who places players into a sports book for a commission.
Arbitrage – An arbitrage is a combination of bets so that if one bet loses another wins. There is an implication of having an edge, at no or low risk. The second bet hedges the first.
Back Door Cover – Meaningless points scored to cover the spread, by a team that is likely to lose
Bad Beat – A tough loss, e.g., when unwanted points are scored against your wager in the dying seconds of an event, or your horse loses by a nose, after leading all the way.
Book – A sports book or betting establishment that sets odds and accepts wagers on the outcome of sporting events.
Bookie (Bookmaker) – A person, house or organization that takes players’ bets.
Bonus whore – A player who opens an account in an online sports book, poker room, or casino in order to get a bonus with no intention of playing long-term.
Chalk – The favored team, side, contestant or horse in a sports event.
Cover – To win against the spread.
A Dime – The sum of $1,000.00.
Dime Line – Less than the standard 20-cent line, the “dime line” is sometimes offered in baseball by player friendly sportsbooks. The dime line charges only half the juice of standard football/basketball bets.
Dog – A term for underdog, Alpo or puppy, i.e., the contestant or team that gets the points.
A Dollar – The sum of $100.00.
Edge – The advantage in any wager.
Even Money – A wager where neither side lays any odds, both sides bet $100 to win $100.
Exotic Wager – Action other than a straight wager, e.g., teasers, futures, round robins etc.
Fade – To bet against.
Favorite – The team expected to win.
Fixed – A slang term referring to the outcome of a race, contest or game that has been illegally pre-determined.
Futures – A type of wager made, or lines/odds posted, on an event, or outcome, that will be determined sometime in the future, e.g., betting during the season on which team will win the Super Bowl, World Series, NBA Championship or Stanley Cup etc.
Handicapper – A person who analyzes, studies and rates sporting events.
Hedge – To bet the opposite of an original bet to offset the possible loss on the original action.
Hook – A half point added to football and basketball point spreads, as in 3.5 or 3 and a hook. Bettors “buying the hook”, are paying extra odds to move the spread by an extra ½ point.
Hooked – The loss of a wager by exactly a half point.
Juice – The amount charged by the bookmaker for taking bets.
Lay the Points – a wager on a favorite in a point spread event.
Lay the Price – a wager on a favorite in a money line event.
Line – Refers to the listed odds, points, money line or point spread for any given event.
Linemaker – the person who establishes the original and subsequent betting lines for an event.
Longshot – An extreme underdog.
Middle – Winning both sides of the same betting proposition. Placing a wager on the favorite team at -2 1/2 with one sportsbook, then taking +3 1/2 with another sportsbook. When the game ends up with the favorite winning by exactly 3 points, the player has middled the game. Middling is a favorite betting method of wise guys.
Money Line – Odds strictly on the straight-up game outcome with no consideration for a point spread.
Neutral Sites – The site of a sporting event where neither team has home-field advantage.
Newspaper Line – The lines that appear in various daily newspapers.
A Nickel – A $500.00 wager.
Odds – The likelihood of an outcome occurring, stated in number form.
Oddsmaker – Same as the linesmaker, i.e. the person who establishes the original and subsequent betting lines for an event.
Overlay – The odds of a wager are higher than they should be, and tend to favor the player rather than the house.
Over/Under Bet- Over/Under is a bet on the combined scores or total points scored by both teams in a game.
Parlay – A bet on two or more teams, or outcomes, in no particular order, where all selections must win for the player to be successful. All teams wagered on in a parlay must win to ensure a payoff.
Parlay Card – A set of sides, totals, and prop bets printed on a card. The numbers on the parlay card apply only to bets on the card and could be different from bets listed on the board. You will need to select at least three bets if you want to play the card.
Past Performance – an accurate record of the performance of specific teams, horses or contestants when participating in sports events similar to those scheduled.
Past Post – A bet made after a sporting event has started. Term originated from “post time” for horse racing.
Pick or Pick’em – a game where no team, or betting option, is favorite.
Point Spread (or Spread) – Used to even the odds of a particular sporting event. Each team has points either added to its score, or subtracted from its score, to determine if the bet is a winner.
Power Ratings – Numbers that handicappers assign to teams to estimate how likely one team is to beat the other.
Press – To wager a greater amount than usual.
Price – The money line odds or point spread on the favorite of a sports event.
Proposition Bet – A wager on a specific aspect of an event such as the number of field goals, free throws, etc., that will be made.
Public Money – The money that the public is betting on or action coming from unsophisticated bettors or squares. Public bettors possess no special information, but rather bet based upon information available in newspapers and TV preview shows.
Push – A tie between the player and the sportsbook where the final score of a game is exactly the same as the point spread, or the total points (combined scores of both teams). This bet has no action.
Revenge Game – A team playing an opponent who beat the team in their previous matchup – therefore the team would like to “revenge” the loss.
Rundown – A line (or spread) update.
Run Line – A line used when wagering on baseball. The line adds 1.5 runs to the underdog and subtracts 1.5 runs from the favorite.
Runner – A messenger player who places a bet for another.
Scalper – One who attempts to profit from the differences in odds, from book to book, by wagering both sides of the same game at different set prices.
Scout – A person who studies the performance and potential of teams, horses or contestants, in or out of play, and reports the pertinent findings to handicapper(s).
Sharp Bettor – A player who has an edge due to his superior knowledge.
Side – To bet on a single team to win a game against the spread (ATS).
Smart Money – Money wagered on a side by knowledgeable handicappers.
Soft Line – A wagering line that is not current with the true posted line, that is, a line that has been adjusted, or moved, as a result of action, but does not reflect the true line as posted.
Sportsbook – A person or company that accepts bets.
Spread- An abbreviated form of point spread.
Square – An unsophisticated player.
Stake – money used to wager on the success or failure of a particular event.
Straight Up – Winning on the scoreboard without any regard to the point spread.
Straight Wager – A single straightforward wager on a selected side, or over/under. The team wagered on must win by the point spread given at the time of the wager.
Sucker Bet – A wager that overwhelmingly favors the bookmaker or house.
Syndicate – A group of people making a combined effort to win money betting sports.
Take the Points – A bet on the underdog so that the bettor “takes the points” in the point spread.
Tapped Out – a condition experienced by players who are broke (busted).
Teaser – A bet on two or more teams where the line on each team is adjusted in favor of the player.
Ten Cent Line – The money line difference (10 cents) between what a player bets with the favorite, or takes back with the underdog.
Toke – A tip or gratuity.
Total – The total is a number set by the sportsbook for total points to be scored by both teams during a game.
Tout – Tout – A person who either sells or gives away his selections on games, races or contests.
Trend – Using past game results to predict future results.
Twenty Cent Line – The money line difference (20 cents) between what a player bets with the favorite, or takes back with the underdog. These odds are worse than the 10 cent line.
Underdog – The team, side or contestant in any given event considered to be the least likely to win.
Underlay – The odds of a particular wagering proposition are lower than they should be, that is, they favor the house.
Upset – A straight-up win for an underdog against a favored opponent.
Value – Getting the best odds on a proposition, the highest possible edge.
The Vig – The sportsbook’s commission (same as the Juice).
Wise Guy – A well-informed, knowledgeable, and successful sports handicapper or player.