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Increase your betting bank by understanding soccer odds and how football odds work?
Is there a professional sports bettor within you? Learning how bookmakers think may improve your long-term profits.
Published on 22 December 2017
Updated on 22 December 2017
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As we all know, bookmakers are usually very, very good at using their information to generate odds.The ability to create odds based on previous information and number crunch statistics is so important to a bookmakers survival that they may even outsource their odds creation to other companies that purely specialise on generating accurate odds for sporting events.
The statistical likelihood of an event occurring is not necessarily the same as the odds. Odds represent the bookmakers opinion of the likelihood of an event occurrence alongside the need for the bookmaker to balance both sides of the bet and draw enough money into the event (i.e. Attract you and me to wager our hard earned cash on the prospect of an attractive return).
How can you make money by understanding football odds
This means that you’re running up against lucrative businesses that are only in the game to create accurate and realistic odds to help bookmakers. Therefore, we all need to understand that blindly betting on a favourite team or sporting event without understanding the markets may be exciting and a lot of fun, but it must be treated with the utmost respect, as losing your betting stake and betting bank is a realistic prospect.
How do odds work in football?
Now, let’s get on to the interesting bit and try to understand how soccer odds really work. From the passage above, we have learned that bookmakers obtain odds from their understanding of the sporting event and their need to profit from the outcome.
The bookmaker simply looks at the statistical likelihood of an event occuring and then decides the most appropriate odds for the event. The odds are based on the historical and statistical probability of an event occurring, but also the real need for the bookmaker to make a profit from the selection.
Understanding soccer odds with an example
It’s usually easier to think about an example, so let's imagine your friendly neighborhood bookmaker has a fair two sided coin. One face has heads and the opposite face has tails. If you were to toss the coin in the air and wait for it to land (and all other conditions are fair), the probability of either face landing upright is 50%.
Now, let’s take the example one step further. What if YOU were a bookmaker and wanting to draw people into betting on this coin flipping event. You’ve crunched the numbers over long periods, watched many coin flipping competitions and you’re certain the coin will always provide a 50-50 chance of a heads or a tails landing.
The betting public makes quick decisions and bookmakers use long-term data and statistics
However, during a recently televised coin flipping competition the world observed 50 coin flips and watched as the coin landed 30 times on heads and 20 times on tails...Remember that you’re a bookmaker and not a punter, so you’re not fooled by this short-term increase in the number of head flips when compared to tail flips. You also understand that just because something happened on TV once, it does not mean that it will ever be repeated.
As you’re still the bookmaker, you understand that many recreational sports bettors are not that savvy and after watching the coin flipping competition on TV, your betting customers may believe the next coin flip will favour heads over tails.
Obviously, they would be wrong, if bettors were to base their coin flipping bets purely on TV; they would lose their money over the long-term. Past performance is not always an accurate indicator of future profits and eventually the coin flipping will provide an equal 50-50 return on tails versus heads.
What would the bookmaker do?
Anyway, remember that you’re still the intelligent bookmaker, so you decide to offer your customer what they want...That’s right, punters want to see a clear favourite, so they can decide who should get their betting money. Therefore, you base the odds on 30 heads in every 50 flips (fractional odds: 50/30 or decimal odds: 2.67) and 20 heads in every 50 flips (fractional odds: 50/20 or decimal odds: 3.50) tails, which clearly demonstrates coins landing on heads will be the event favourite (i.e. lowest odds).
Providing a favourite will naturally entice more bettors to stake their money on heads rather than tails (even though both outcomes are equally likely to occur).
So, what does the bookmaker do next?
Let’s not forget that you’re still the bookmaker; punters, sports bettors and traders want to see more outcomes. So, you offer another outcome, which is less likely, but a possible occurrence. You offer the chance for the betting public to bet on the coin landing on its edge and balancing!
This coin balancing outcome, although not as realistic as a heads or a tails landing is still statistically possible, so you price an edge coin landing at 1 in every 50 flips (fractional odds: 50/1 or decimal odds: 51.00).
This now gives you three outcomes, although only two of which are realistic with the third statistically less likely to occur, but with exaggerated odds to increase liquidity (amount of cash wagered on the event) and drive more betting money. The three outcomes in decimal odds format are displayed below:
Heads Odds = 2.67 (based on 30 heads)
Coin Edge Odds = 51.00 (based on 1 coin edge)
Tails Odds = 3.50 (based on 20 tails)
If we look at the odds closely, we can see that 51 outcomes have been priced when only 50 outcomes are possible.
Therefore, the event now has OVER 100% chance of occuring, which means that you, as the bookmaker will collect a profit from every transaction that is wagered on this event. This bookmaker commission (i.e. juice or vigorish) is something that every bookmaker will retain as the service for their activities.
Using coins is simply an easier way to visualise probabilities, but this coin flipping example and bookmaker manipulation of the odds is very similar to how football betting odds work. Bookmakers slightly alter the odds of each soccer match to draw your betting money towards the event and specific outcomes within that event.
You just have to change Heads to Home Win, Coin Edge to Draw and Tails to Away Win and you have a win-draw-win 1x2 betting slip.
Now imagine this process for every sports betting event with an online bookmaker and you can see that slightly adjusting the odds against sports bettors could be very lucrative. This also demonstrates that bookmakers do not need to get the outcome correct, all they have to do is to influence sports bettors to place their money on both sides of the event and then collect the difference in backing odds against laying odds (juice) from the betting public.
How can you beat the bookies at their own game?
Winning more times than you lose and also making a betting profit is not going to be easy, but a long-term approach using a combination of historical information and statistics could guide you to return a long-term profit. Try our Soccer Predictions models, Value Selections, FREE Tips and VIP Tips to help you easily find more value within your match day selections.
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