Straight Bets

I know I know, they aren't exotic and they aren't going to 10x your bankroll over night, but they are simple and profitable. In order to be a profitable sports bettor, you'll need to beat the sports books "juice". Well, what is "juice" you may ask? Juice is simply the sports books' fee for allowing you to place your bets.

Here let me try and explain a little better. Outcomes that have a 50% chance of occurring should realistically double your money for the risk you're taking. With that same logic, outcomes with a 10% chance of occurring should 10x your money, if you were to win. This is known as an inverse relationship. The less likely chance of an outcome occurring should yield a larger return for the bettor, since they took a larger risk with that specific outcome.

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Now that you have a basic understanding of probability and risk/reward, I can show you how the sports books take their juice! If you were to place a bet on a sporting event that had a 50% chance of occurring, you would be offered the betting odds of -110. This implies that if you bet $100, you have the potential to win $190 in total. This means you would risk $100 for a reward of $90. If you recall what I just mentioned above, we should receive double our money when betting on an outcome with a 50% of occurring. But in this instance, we only win $90 instead of a full $100...well, where'd our extra $10 go you might ask? This is the sports books juice! In this instance, we paid a 10% juice to the sports books. 

Let me show you why it is tough to be profitable in the long run using parlays. In our previous example, we paid a 10% juice to the sports books on our straight bet. Now, let's make a parlay. Let's say we choose to parlay 5 picks, all with a 50% chance of occurring, meaning they all have -110 odds. To calculate the true probability of this 5 pick parlay hitting, we can multiple 0.5 x 0.5 x 0.5 x 0.5 x 0.5 which gives us a little over a 3% chance of us winning our parlay. Betting on something that has a 3% chance of occurring should yield us a reward close to 33x our risk. So if we were to bet $10 on this parlay, in reality, we should receive $330 in profit. When placing this parlay on a sports book, you will only receive 20x your risk instead of the 33x we would expect. This means by placing this 5 leg parlay, we are paying close to a 40% juice to the sports books!

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Lastly, let's bring this full circle. I started by telling you that the way to be a profitable sports bettor in the long run is to beat the sports books juice. In our first example, I showed a straight bet that resulted in a 10% sports books juice. I then followed this by showing an example of a 5 leg parlay which resulted in a 40% sports books juice. Simplifying it to this basic statistic really shines a light on how much more profitable straight betting can be compared to high risk parlays.