"Send enquires about this paper to our newly acquired private island in the Bahamas." :-)
One of the most depressing things I realized when I learned to count cards, and confer upon myself a small but meaningful advantage in the game of Blackjack, was that the casinos simply ask you to leave if you win too much. That put an upper limit on the rate at which one could win. The folks who figure out slot machines have a much better time of it because it takes longer for the casinos to figure out they are losing money.
I used to use the betfair platform until it they blocked themselves from being viewed in Canada for some strange reason right after they were purchased by ladbrokes I believe it was.
Anyways, after playing with them for a few years, I was horrified to learn about their 60% tax on consistent winners that they have dubbed a "premium charge".
Found some sort of edge to exploit and reap profits?
Betfair doesn't even care to talk to you to ask you what you are doing, they will just charge you 60% of your winnings once you go over a certain limit. [0]
the casinos simply ask you to leave if you win too much.
I was actually backed off from the first place I went to after I learned how to count cards while I was losing. If the pit boss or dealers know how to count themselves and identify you as a counter, they want no part of it. In most cases, they'll either "flat bet" you (tell you that your initial bet is your maximum), or they'll tell you that you cannot play blackjack there. Actual barrings usually don't occur until the second or third offense.
I my experience as a card counter they'd just swap in a new dealer who would count themselves and just shuffle whenever the count got really good. Ridiculously unfair and probably illegal but what are you going to do, complain?
I've worked for an online bookie. I've also worked for an outfit that bets (on horses mainly).
The online bookie will indeed ban or limit winning accounts or anyone they suspect of cheating or betting smartly. Anyone betting large amounts dumbly gets taken out to nice dinners etc.
The company that bets on horses bets using exchanges, because bookmakers would tend to kick them out. The abstract of this paper is pretty much 101 to those guys who do some advanced stuff I can't talk about to make predictions.
One main difference is that the vast majority of sports betting occurs outside of casinos and "legality". The other huge difference is that the entity making the picks doesn't necessarily have to be the person placing the bets. There is a well established term in sports betting for one who places a bet for someone else, "beard". Fortunately for the bookies/casinos and the few winning bettors, there are always plenty of losing bettors to keep the system afloat and profitable for everyone with an edge.
There has to be more to this story. I would like to hear the bookmakers side of this. Perhaps the researchers were scripting or triggered some other kind of security tripwire.
Winning $900 split across several different bookmakers is absolutely nothing in the sports betting industry.
William Hill, one of the companies that the researchers claim restricted them is a multi billion dollar company. They aren't sweating small time bets like this.
EDIT: I noticed that the screenshots they used as proof their bets were restricted are for bets on very minor football leagues (Australian semi pro football), its common for betting limits to be lower for games that don't see a lot of betting action & is not proof enough to me that the bookmakers lowered their limits globally
Bookies will limit you no matter what your stakes are. You can get your account closed by placing £10 bets, and even if those bets don’t win!
Bookmakers are on the lookout for exactly the kind of betting behaviour described in the paper: people only betting on the top price, and shopping around for the best odds. If they see that you are only grabbing mis-priced offers, you are unlikely to be a profitable customer to them.
The bet size doesn’t really come into it. Just look at it from their point of view; why keep a customer who is costing you money, however little it is.
My guess is that it’s the manner by which they were winning. Thirty $50 bets per week over five months is over 500 bets. That’s not the long run but winning at an 8.5% ROI over that many bets is probably enough for the house to realize they’re somehow a winning player even if the stakes aren’t huge.
I've been trying my luck at tennis betting ( https://matchstat.com/profile/soniman ) and the only strategy that seems to work consistently is finding injured players and betting against them. Good example of an injured player is a player that limps (Andy Murray at Wimbledon this year). The computers don't watch matches so injured players can be overvalued by the models. Also, any British tennis player tends to be overvalued because the books are based in the UK. For instance there is an overweight British player named Marcus Willis that last week was a 1.01 favorite to win at a tournament in Las Vegas; he lost, apparently due to dizziness aka being fat. There are some other patterns that can be exploited but the highest return strategy has to be betting against injured favorites. However, I think that would probably require more tennis watching than I want to do. Maybe I could hire somebody on Mechanical Turk to watch tennis for me and report on players who appear to be injured or take medical time outs.
Maybe you could find a sport where injuries are logged or can be inferred from other data? For instance if a racehorse performs far slower than its typical pace, its odds of losing the subsequent race might be higher.
> A few weeks after we started trading with actual money some bookmakers began to severely limit our accounts, forcing us to stop our betting strategy.
Isn't this like literally one of the oldest tricks in the book? I remember reading Reminiscences of a Stock Operator, which talks in part about early 1900's bucket shops, and the same stuff was there even then. Similar stuff is also mentioned in market microstructure textbooks with market makers on one side and informed traders on the other side.
Is rigged even the right word here? It might be, but did the bookmakers have a responsibility to keep accepting their bets? Is it different from claiming that casinos are rigged?
Same here. If you have a strategy that wins you money overall, bookmakers either send you a nice email saying your account is closed as they do not welcome professional players or they just severely limit your stakes (think $20 a bet).
(Will Hill, Interwetten, Betway are exactly the type of bookies that will close your account as soon as they catch on)
Yes, the odds can be exploited and there is a whole bunch of services offering picks, but eventually the sportsbooks catch on and close your account. The sportsbooks that welcome professional players are few and far between and their odds are on point.
Correct -- the market maker (or casino) is under no obligation to take your action. And, why should they be? The penalty for refusing action is that you take your business elsewhere.
I always thought bookies just kept moving the lines until they were making money at the snap of the ball. Their initial line isn't as important as adjusting the line so that there is equal money on both sides of the line and therefore the bookie is guaranteed money due to the small fee they build into the bets. Their profits don't depend on accurately predicting the game's score, just moving the line strategically as more bets come in.
Yes, of course you can beat the "popular" bookmakers.
Once you start beating them ( being profitable in value prices ) they will simply close/ban your account. Nowadays, it happens extremely fast ( in a day or a few hours, depending on your moves ).
It's a well known tactic, and in practice, you cannot do anything about it ( other than keep opening new accounts in new names ).
"Retail" bookmakers are only interested in mugs. If your betting patterns indicate someone who is wise to the market, you will be limited or shown the door. Be prepared to have arbitrage positions pulled out from under you. The game is rigged insofar as the book decides if it wants to entertain your position.
If you want to make money you have to bet against, and be able to beat the books that know what they are doing - The high limit, low margin books like Pinnacle, SBO, IBC et al will happily take you on.
> A strategy intended to beat the bookmakers at predicting the outcome of sports games requires a more accurate model than the ones bookmakers have developed over many years of data collection and analysis.
I disagree with this assumption and I think they have painted themselves into a corner because of it. To illustrate, imagine charting win rates against bins of price-implied-chances. $3 horses win roughly 33% of the time, $4 horses 25% for example. It resembles a noisy 1:1 linear relationship. Do the same for your selections and your line will be noisier, but crucially you're not taking bets where the price is worse than your estimate. This can leave a window of profitibility when you subtract the two, even when you are less 'accurate' as measured by win rate or KLD or other measures.
The goal is profitibility, not accuracy. The problem with including the odds you are betting against as a feature for your ensemble is that it dampens that window. If you're right about your selections, you'll bet less and win less. * If you're concerned about the volitility that comes with being less accurate, there are better ways to address that.
I've been doing this for a couple of years and in many ways it's a dream side-project. Location independent, no customers, automatable, and in some jurisdictions tax-free. It can be a little lonely at times though. I would love to chat with anyone else applying tech/math to beat the bookies. Sorry for the throwaway, I'll put a contact in my profile.
What the authors are doing is “chasing steam” and most books will ban or limit you if you try this. This should come as no surprise to people with experience in the industry. The books aren’t limiting/banning them for winning - it’s the way in which they were winning. They are betting slow moving books’ lines. Their strategy only works at poorly managed books as long as they can bet quickly. I doubt they made any bets at a sharp friendly book like pinnacle.
If anyone would like to collaborate with some model building get in touch. I already have a large db of most of the stats you’d ever need and some okay but not amazing models for most major sports.
A couple of suggestions to improve on this method.
The authors' regression left an intercept or 'adjustment term' of 3.4% - 5.7%. For a perfect bookmaker, this intercept term would be equal to the overround. The number calculated unfortunately averages that overround between different bookmakers and at different times (overrounds often decrease over time). It might be more effective to adjust for the actual overround of each market sampled, i.e. divide each price by the sum of the inverse of the prospects.
They appear to use a flat betting strategy, and the threshold to bet or not was selected based on profitibility. I was simplifying in another comment when I said profitibility should be the goal. In reality it's utility you should be optimizing for. Nobody wants a ultimately profitable system that reads like an EKG, they want a high sharpe ratio. The paper's results are actually very good here, but the trend could be lifted and stabilized further by betting proportionally to expectation, or by explicitly optimizing for such.
Raises an interesting point regarding a staking strategy. Given the bookmakers are going to cut you off, it potentially could be better to just go as hard as you can & live with the risk.
Alternatively, an interesting tweak would be to see what the best historical edge has been, and wait for the best opportunities to surface & only bet on those. Effectively you limit yourself by saying "I can only place N bets per bookmaker, what should my strategy be?"
They claim the market is inefficient. I worked for a company that to some extend fixed that. Can't remember all the details (I worked on a different part), but something like this:
Most big betting companies were customers. They all continuously sent their updated odds to us, and we would broadcast to the other companies. They would react to the change based on certain rules and send new updated odds back to us. This would then converge.
The inefficacy comes from promotions, company X always wanting to have odds .1 better than company Y etc.
Haha, this exactly describes arbitrage. My old company was "sent ... updated odds" (well, we scraped their sites often...) and "we would broadcast to the other companies" by betting on those other companies' sites when the lines crossed, and "This would then converge" because one of the bookies in the arb would move the odds after we hit them (or after we hit them a second or third time...)
Just like the rake or the edge the house advantage of making the rules has always been the reality of betting. Online or offline. Forever. Get too successful and you’re no longer invited to bet.
Asymmetry of information has never been the bookmaker’s most powerful weapon. The book is.
Those who are successful at it accept this reality. They grumble and make peace with it - paying the super taxes and liquidising markets where they’re asked to.
Ultimately however, while it’s interesting to see how they do some of this (and there are plenty of practices not covered in the paper, I assure you) it’s a bit like complaining the DM won’t let you do something in dungeons and dragons - you’re dicing with the god of your domain so the rules can change at any minute.
I used to work for a popular UK online bookmaker. The thing that a lot of these comments are missing is that bookies aren’t going to sell a product at a loss. They’re also not even selling the product you think they are (something akin to an investment).
Bookmakers sell excitement / entertainment - the thrill of the potential win is the product, and costs approximately 10% of what you can afford to stake.
The most interesting thing was left out: how did they find this data? Both historical and realtime is pretty hard to find. Ten years of odds from a dozen bookies looks like a massive task.
Next: how do you mask this behavior to not be obvious. Once you have a betting stratetgy the real difficulty is turning it into one that isn't obvious.
I don't see why we cannot have completely distributed betting platform using para-mutual betting strategy that collects and distributes bets and winnings on the basis of publicly reported sports results with no take-out.
I prefer para-mutual rather than a house deciding the odds. It is a more free-market approach. It has been used in horse racing, but the takeout has been too large which makes it hard to be profitable.
They could have reduced a lot of the work (calculating the mean across 32 bookmakers and applying a constant for the margin) by just taking the price from a highly liquid exchange like betfair, which is pretty close to a 100% efficient de-marginated line.
Although it still wouldn't have prevented their accounts from being limited.
Shouldn't the goal of a bookie simply be to balance his book and have no position on the actual odds of the match? Of course it makes sense to deny action to known sharps, this should come as no surprise.
I don't totally understand why the bookmakers would limit their accounts.
The bookmaker wants to balance his book for each game to make sure he makes a profit no matter what the outcome is. To balance their books they might give better odds for an outcome than what a statistical model might suggest.
But what difference does it make if the bettor who helps them balance their books is a consistent winner or not?
Do they prefer to give these "good" odds to people who are losing money long term?
> The bookmaker wants to balance his book for each game to make sure he makes a profit no matter what the outcome is.
This part is not really true. Bookies will very often have an unbalanced book and will be happy to keep taking action on the side that increases their exposure, if the price is right.
Because people who bet sharply on lines reduce the long term profitability of the bookies. While they reduce the variance, they take directly from the profits.
Defeats the point of being a bookie when better bettors imbalance the book in one direction and win.
It’s really simple: For a bookie, if a customer is winning money, then you are losing money. Doesn’t matter if they are helping balance your books or not. So why take their bets?
Likewise, bookmakers will happily take bets from guessers all day long. If they are lucky enough to get a ‘whale’ placing huge (but dumb) bets, they can easily lay off those bets elsewhere to manage their risk. They don’t need skilful gamblers to help balance their books.
Don't try to overthink it: imagine the bookies having a dashboard that shows everybody's win rate (or alternatively, how much the bookie is losing) and then they ban or limit the top performers.
[+] [-] ChuckMcM|8 years ago|reply
One of the most depressing things I realized when I learned to count cards, and confer upon myself a small but meaningful advantage in the game of Blackjack, was that the casinos simply ask you to leave if you win too much. That put an upper limit on the rate at which one could win. The folks who figure out slot machines have a much better time of it because it takes longer for the casinos to figure out they are losing money.
[+] [-] GigabyteCoin|8 years ago|reply
Anyways, after playing with them for a few years, I was horrified to learn about their 60% tax on consistent winners that they have dubbed a "premium charge".
Found some sort of edge to exploit and reap profits?
Betfair doesn't even care to talk to you to ask you what you are doing, they will just charge you 60% of your winnings once you go over a certain limit. [0]
[0] https://www.theguardian.com/sport/2011/jun/29/betfair-premiu...
[+] [-] downandout|8 years ago|reply
I was actually backed off from the first place I went to after I learned how to count cards while I was losing. If the pit boss or dealers know how to count themselves and identify you as a counter, they want no part of it. In most cases, they'll either "flat bet" you (tell you that your initial bet is your maximum), or they'll tell you that you cannot play blackjack there. Actual barrings usually don't occur until the second or third offense.
[+] [-] CPLX|8 years ago|reply
[+] [-] quickthrower2|8 years ago|reply
The online bookie will indeed ban or limit winning accounts or anyone they suspect of cheating or betting smartly. Anyone betting large amounts dumbly gets taken out to nice dinners etc.
The company that bets on horses bets using exchanges, because bookmakers would tend to kick them out. The abstract of this paper is pretty much 101 to those guys who do some advanced stuff I can't talk about to make predictions.
Good luck!
[+] [-] webkike|8 years ago|reply
[+] [-] stephengillie|8 years ago|reply
[+] [-] grecy|8 years ago|reply
I have always thought about learning to count cards, instead of say learning a new language.
Can't you just go to another casino until they kick you out, and repeat?
Do you actually make money now that you can count?
[+] [-] StanislavPetrov|8 years ago|reply
[+] [-] unknown|8 years ago|reply
[deleted]
[+] [-] GrumpyNl|8 years ago|reply
[+] [-] utnick|8 years ago|reply
Winning $900 split across several different bookmakers is absolutely nothing in the sports betting industry.
William Hill, one of the companies that the researchers claim restricted them is a multi billion dollar company. They aren't sweating small time bets like this.
EDIT: I noticed that the screenshots they used as proof their bets were restricted are for bets on very minor football leagues (Australian semi pro football), its common for betting limits to be lower for games that don't see a lot of betting action & is not proof enough to me that the bookmakers lowered their limits globally
[+] [-] joosters|8 years ago|reply
Bookmakers are on the lookout for exactly the kind of betting behaviour described in the paper: people only betting on the top price, and shopping around for the best odds. If they see that you are only grabbing mis-priced offers, you are unlikely to be a profitable customer to them.
The bet size doesn’t really come into it. Just look at it from their point of view; why keep a customer who is costing you money, however little it is.
[+] [-] mason55|8 years ago|reply
[+] [-] nl|8 years ago|reply
That's... interesting.
http://www.abc.net.au/news/2014-09-22/soccer-clubs-obvious-m...
[+] [-] soniman|8 years ago|reply
[+] [-] flashman|8 years ago|reply
[+] [-] conistonwater|8 years ago|reply
Isn't this like literally one of the oldest tricks in the book? I remember reading Reminiscences of a Stock Operator, which talks in part about early 1900's bucket shops, and the same stuff was there even then. Similar stuff is also mentioned in market microstructure textbooks with market makers on one side and informed traders on the other side.
Is rigged even the right word here? It might be, but did the bookmakers have a responsibility to keep accepting their bets? Is it different from claiming that casinos are rigged?
[+] [-] agilebyte|8 years ago|reply
(Will Hill, Interwetten, Betway are exactly the type of bookies that will close your account as soon as they catch on)
Yes, the odds can be exploited and there is a whole bunch of services offering picks, but eventually the sportsbooks catch on and close your account. The sportsbooks that welcome professional players are few and far between and their odds are on point.
[+] [-] dogruck|8 years ago|reply
[+] [-] skizm|8 years ago|reply
[+] [-] dogruck|8 years ago|reply
Suppose your book is balanced, and you have $25,000 on each side. Then a new bet comes in, size $250,000, on one side of your book -- what to do?
Or, more simply, when you set your initial line, what do you do when a known sharp immediately wants action on one side?
[+] [-] antouank|8 years ago|reply
Once you start beating them ( being profitable in value prices ) they will simply close/ban your account. Nowadays, it happens extremely fast ( in a day or a few hours, depending on your moves ). It's a well known tactic, and in practice, you cannot do anything about it ( other than keep opening new accounts in new names ).
Try beating a betting exchange.
[+] [-] brucen|8 years ago|reply
[+] [-] psynapse|8 years ago|reply
If you want to make money you have to bet against, and be able to beat the books that know what they are doing - The high limit, low margin books like Pinnacle, SBO, IBC et al will happily take you on.
[+] [-] mherdeg|8 years ago|reply
> During that period we obtained an accuracy of 47.% [sic] and a profit of $957.50 across 265 bets, equivalent to a 8.5% return (Table 1, Figure 3).
For some reason the "ok but how much did you ACTUALLY MAKE?" is always my favorite part of this kind of business or economics literature.
[+] [-] au_gambler|8 years ago|reply
I disagree with this assumption and I think they have painted themselves into a corner because of it. To illustrate, imagine charting win rates against bins of price-implied-chances. $3 horses win roughly 33% of the time, $4 horses 25% for example. It resembles a noisy 1:1 linear relationship. Do the same for your selections and your line will be noisier, but crucially you're not taking bets where the price is worse than your estimate. This can leave a window of profitibility when you subtract the two, even when you are less 'accurate' as measured by win rate or KLD or other measures.
The goal is profitibility, not accuracy. The problem with including the odds you are betting against as a feature for your ensemble is that it dampens that window. If you're right about your selections, you'll bet less and win less. * If you're concerned about the volitility that comes with being less accurate, there are better ways to address that.
I've been doing this for a couple of years and in many ways it's a dream side-project. Location independent, no customers, automatable, and in some jurisdictions tax-free. It can be a little lonely at times though. I would love to chat with anyone else applying tech/math to beat the bookies. Sorry for the throwaway, I'll put a contact in my profile.
[+] [-] Bromskloss|8 years ago|reply
How's that contact information coming along? :-)
[+] [-] andr3w321|8 years ago|reply
If anyone would like to collaborate with some model building get in touch. I already have a large db of most of the stats you’d ever need and some okay but not amazing models for most major sports.
[+] [-] LittlePeter|8 years ago|reply
[+] [-] au_gambler|8 years ago|reply
The authors' regression left an intercept or 'adjustment term' of 3.4% - 5.7%. For a perfect bookmaker, this intercept term would be equal to the overround. The number calculated unfortunately averages that overround between different bookmakers and at different times (overrounds often decrease over time). It might be more effective to adjust for the actual overround of each market sampled, i.e. divide each price by the sum of the inverse of the prospects.
They appear to use a flat betting strategy, and the threshold to bet or not was selected based on profitibility. I was simplifying in another comment when I said profitibility should be the goal. In reality it's utility you should be optimizing for. Nobody wants a ultimately profitable system that reads like an EKG, they want a high sharpe ratio. The paper's results are actually very good here, but the trend could be lifted and stabilized further by betting proportionally to expectation, or by explicitly optimizing for such.
[+] [-] brucen|8 years ago|reply
Alternatively, an interesting tweak would be to see what the best historical edge has been, and wait for the best opportunities to surface & only bet on those. Effectively you limit yourself by saying "I can only place N bets per bookmaker, what should my strategy be?"
[+] [-] flashman|8 years ago|reply
[+] [-] shakedown1|8 years ago|reply
[+] [-] scwoodal|8 years ago|reply
https://github.com/Lisandro79/BeatTheBookie
[+] [-] maaaats|8 years ago|reply
Most big betting companies were customers. They all continuously sent their updated odds to us, and we would broadcast to the other companies. They would react to the change based on certain rules and send new updated odds back to us. This would then converge.
The inefficacy comes from promotions, company X always wanting to have odds .1 better than company Y etc.
Edit: Not sure how it works now, but: https://www.betradar.com/ and https://mts.betradar.com/
[+] [-] repsilat|8 years ago|reply
[+] [-] johnzim|8 years ago|reply
Asymmetry of information has never been the bookmaker’s most powerful weapon. The book is.
Those who are successful at it accept this reality. They grumble and make peace with it - paying the super taxes and liquidising markets where they’re asked to.
Ultimately however, while it’s interesting to see how they do some of this (and there are plenty of practices not covered in the paper, I assure you) it’s a bit like complaining the DM won’t let you do something in dungeons and dragons - you’re dicing with the god of your domain so the rules can change at any minute.
[+] [-] glenjamin|8 years ago|reply
Bookmakers sell excitement / entertainment - the thrill of the potential win is the product, and costs approximately 10% of what you can afford to stake.
[+] [-] alkonaut|8 years ago|reply
Next: how do you mask this behavior to not be obvious. Once you have a betting stratetgy the real difficulty is turning it into one that isn't obvious.
[+] [-] SubiculumCode|8 years ago|reply
I prefer para-mutual rather than a house deciding the odds. It is a more free-market approach. It has been used in horse racing, but the takeout has been too large which makes it hard to be profitable.
[+] [-] dogruck|8 years ago|reply
Said another way, customers will choose to place bets with market makers, instead of some paramutual operation.
[+] [-] shakedown1|8 years ago|reply
Although it still wouldn't have prevented their accounts from being limited.
[+] [-] rajacombinator|8 years ago|reply
[+] [-] watoc|8 years ago|reply
The bookmaker wants to balance his book for each game to make sure he makes a profit no matter what the outcome is. To balance their books they might give better odds for an outcome than what a statistical model might suggest.
But what difference does it make if the bettor who helps them balance their books is a consistent winner or not?
Do they prefer to give these "good" odds to people who are losing money long term?
[+] [-] dmurray|8 years ago|reply
This part is not really true. Bookies will very often have an unbalanced book and will be happy to keep taking action on the side that increases their exposure, if the price is right.
[+] [-] iopq|8 years ago|reply
Defeats the point of being a bookie when better bettors imbalance the book in one direction and win.
[+] [-] joosters|8 years ago|reply
Likewise, bookmakers will happily take bets from guessers all day long. If they are lucky enough to get a ‘whale’ placing huge (but dumb) bets, they can easily lay off those bets elsewhere to manage their risk. They don’t need skilful gamblers to help balance their books.
[+] [-] hudibras|8 years ago|reply
Instant and legal profit for them.