I’ve had a couple of e-mails from members asking for advice on how to get around bookies limits and how to make sure they are getting the best prices in general. Rather than send individual responses I thought I’d write an article on the subject and send it out to everyone. I hope it proves useful.

In order to maximise your long term profits, it is crucial that you have numerous accounts with different bookmakers and always make sure you are taking the best price. You should have accounts with Ladbrokes, Hills, PaddyPower, StanJames, SkyBet, BlueSquare, B365, BetFred, BoyleSports, sportingbet, Bet Direct, Coral, ToteSport and Victor Chandler as these will be the companies whose prices I recommend. CentreBet are an Australian based firm who have grown quite a bit over the last few years and I also recommend you open an account with them.

All of the above are safe and secure to bet with and all offer various forms of free bets when you first open an account. Most bookmakers bet to around 110% on the match odds of many European leagues. This means that they have worked out the percentage chances of each event occurring in any particular game and added on a 10% profit margin. This makes it very difficult to make profit from betting with just one bookmaker as even if they get their prices wrong, they have to be more than 10% wrong to give you a fair chance of beating them. Those who just use their local high street shop have virtually no chance of long term success.

However, if you have ten accounts with ten different bookmakers, the differences in opinions between the bookmakers on some games can erode the margin you are facing down to practically nothing. When there is a big move for something and certain bookmakers are slow to react the odds can then swing in the punters favour and you can lock in a profit by backing all three outcomes with different bookies. We’ll use a hypothetical fixture between Aston Villa and Everton as an example with the following bookmakers offering the following prices:

SkyBet

Villa 11/10 (48%) Draw 11/5 (31%) Everton 11/5 (31%)

Ladbrokes

Villa 10/11 (52%) Draw11/5 (31%) Everton 11/4 (27%)

BetFred

Villa 4/5 (56%)   Draw 12/5 (29%) Everton 3/1 (25%)

Each bookmaker is betting to 110% but if you take the best prices for each outcome from across the three bookmakers you get:

Villa   11/10 (48%) with SkyBet
Draw  12/5  (29%) with BetFred
Everton 3/1 (25%) with BetFred

these three prices only add up to 102% rather than 110% so straight away by shopping around for the best price you have eroded 8% of the margin. We will continue to use this hypothetical fixture as an example and introduce a scenario where Tim Cahill, Phil Neville, Lee Carsley and Andrew Johnson pick up a virus for Everton the day before the game and are unable to play. BetFred and Ladbrokes pick up on this information and both firms cut their prices to:

Villa     4/6 (60%)
Draw   13/5 (28%)
Everton 7/2 (22%)

SkyBet however, are slow to pick up on this information and do not cut their price until one hour later. Therefore, the best prices available for that hour are:

Villa 11/10 (48%) SkyBet
Draw  13/5  (28%) BetFred and Ladbrokes
Everton 7/2 (22%) BetFred and Ladbrokes

These prices add up to 98% and present punters with an opportunity to lock in a 2% profit regardless of the result by taking the three best prices available.

BetFair is another account EVERY serious gambler should have. They are a betting exchange who allow you to bet against other punters by backing or laying any outcome. Because they are not a bookmaker there is no built in profit margin and they make their money by taking 2-5% of your winnings depending on how many loyalty points you build up with them. The more money you put through the site the less commission you pay. They advertise that on average their prices are 20% better than you can get with bookmakers and therefore it is well worth the relatively small commission charge. This is true to an extent but slightly misleading.

Generally BetFair will be the best price but when it comes to backing a favourite the difference between BetFair and the bookies is rarely 20%. It is generally a big enough difference to make it worthwhile having the bet with BetFair rather than the bookie though. Outsiders on the other hand are often a much bigger price on BetFair than they are with the bookies. You should always check the price on BetFair when I make a recommendation as it may be bigger than the recommended bookmaker price.

Another useful tool for gamblers is shop coupons. These are often printed days in advance of a fixture and the prices will still be available in a shop even though they have been cut online. Some bookmakers are very sly however and will accept your bet on the coupon and then pay you at the new lower price. They are supposed to tell you if a price is no longer available yet the poorly paid and unmotivated staff will often not bother until it comes to paying out. Therefore I only recommend Ladbrokes and Hills shop coupons as if you get the bet on they will pay you at the coupon price.

Messages are sometimes sent to shops telling staff that limits have been imposed on certain teams. Using the Villa v Everton game from before as an example, Ladbrokes might send a message to shop staff that customers can only have a maximum of £100 on Villa at the coupon price of 10/11 and anything over £100 will have to be at 4/6. If you want £200 on Villa then simply say you only want £100 and then walk down the road to the next Ladbrokes shop and put the second £100 on there. Obviously this is much more difficult if you live in rural areas. If there is any sort of dispute with the shop just phone up customer services and complain. I have a friend who used to work for Ladbrokes customer services a few years ago and apparently they have a cupboard full of free bet vouchers to give out to anyone who has a legitimate complaint. They are very keen to keep the customer happy so its always worth giving them a ring.

Anyone who has had any success with their betting will know that eventually bookies start to get upset when you start winning on a regular basis. Bookies call these people “unprofitable customers” and they will restrict how much money you can get on by factoring your account down. Going back to the Villa v Everton game again, SkyBets maximum bet per customer on the internet might be set at £1000. An “unprofitable customer” might be factored to half of what a regular customer can get on and might only be allowed £500. Depending on how unprofitable you are you might be restricted to a tenth or even less and at this stage some accounts become literally unusable.

There’s more than one way to skin a cat though and with most bookmakers you can simply open a new account with a different credit/debit card in your own name and carry on regardless. Some might realise its the same account quite quickly and a few will do IP address checks to see where you are placing the bet from and link you to other accounts at that IP address. Your account will last longer if you change your username too as some traders might remember the old one. It’s best to set your username to something unremarkable too, such as a set of numbers or maybe a foreign name as it is less likely to stick in a traders memory. If your username is “bookiebasher72″ or something along those lines, then traders are much more likely to remember you having a bet on that dodgy non league game last week and decide to restrict your account. Another way around bookies limits is opening a “shadow” account in a partner/family members name as this will be very difficult to link to your other account unless they run an IP address check. Obviously get the permission of your partner/family member first

If you do bet in reasonably large amounts the likelihood is that you will soon start to have difficulties with some bookmakers if you follow my selections. If you follow the instructions above though you should be able to sidestep these problems and continue fleecing the bookies. I would recommend using BetFair as much as possible as they will not stop you getting on after a few big winners. If the bookmakers price is only going to pay a couple of quid more than BetFair after commission then it might be worth taking the marginal drop in profit, especially if it means protecting an account that might be on borrowed time. Use shop coupons where you can and use different shops where possible as this will prevent them from monitoring your business.

Best Wishes

The Oracle

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The Oracle works as an odds compiler for a major uk bookmaker.

He retired from his moonlighting job as a tipster to free up more time for his family. You can read more sage advice from him however in the free soccer betting course available at www.football-bets.co.uk

The Favourite-Longshot Bias in Football Fixed Odds Betting

Consider a typical Premiership game, Manchester United (home) versus Bolton (away). In an efficient betting market, the prices for the home and away win should reflect all available information about the chances of either side winning, which if available to both bookmaker and punters alike, should then be backed in direct proportion to the probability of each result occurring. Suppose Manchester United was considered to be 6 times more likely to win than Bolton. An efficient betting market might then predict home and away win odds of 1.333 (or 1/3) and 8.0 (or 7/1) respectively, and we would expect punters to bet £1.333 on Bolton for every £8 that was bet on Manchester United. If the draw was priced at 4 (or 3/1), the bookmakers margin, or overround, for this book would be 112.5%. There might be subtle changes in price, in response to varied money flow, but if the market remained efficient, every price would remain close to that predicted by the information available.

Unfortunately for the bookmaker, punters don’t readily conform to normative theories of economic efficiency. Whilst market efficiency implies an equality of expected returns for Manchester United and Bolton alike, many punters express different utility attitudes to bets of equal profit expectancy if the bets have different win probabilities. Put more simply, a risk-loving punter sees more point to a 7/1 shot than a 1/3 shot even though over the long term he won’t win any more or less on either. He sees more benefit or utility in a short term reward of £7 for a £1 stake than making 33 pence even though he is 6 times more likely to win the latter. Consequently, whilst there will still be more money bet overall on Manchester United than Bolton, the bookmaker will see proportionally more money bet on the 7/1 shot than is justified by its objective chances of winning. In this example, for every £8 bet on Manchester United, the actual amount bet on Bolton might well be £1.50 or more

There are all sorts of reasons that might explain why many punters express this attitude, which is beyond the scope of this article. For now it is sufficient to say that if Bolton, as the underdog or longshot is overbet, whilst Manchester United, the favourite, is underbet, the bookmaker will have to shorten his price for Bolton and lengthen his price for Manchester United until they reflect the actual volumes of traded bets and the liabilities he faces. More generally, a bookmaker will have to lower the expected return on longshots whilst raising them for favourites, until they once again provide equal expected betting utility for the population of punters. This market anomaly is more commonly known as the favourite-longshot bias and is simply the result of too much money being bet on longshots, and too little on favourites, relative to their “true” chances of winning.

Just how much are expected returns raised and lowered on favourites and underdogs respectively? An analysis of betting odds taken from the bookmaker William Hill for over 14,000 games played from 2000 to 2007 in the English professional league divisions confirms the presence of a favourite-longshot bias. Backing every home and away result would have yielded, on average, a loss of 12.44 pence for every £1 staked. By contrast, backing all home and away prices greater than 2/1 would have lost the punter 16.75 pence for every £1 staked, whereas betting on all teams with an odds-on price would have lost 9.17 pence. Backing teams at shorter than 1/2 would have lost only 4.86 pence for every £1. A more detailed breakdown of returns against betting price is illustrated in the figure below.

Of course, understanding this favourite-longshot bias will not on its own make a profit for the punter. It should demonstrate, however, that making money from underdogs is that much harder than one might otherwise have expected.

Joseph Buchdahl is the author of the book Fixed Odds Sports Betting: Statistical Forecasting & Risk Management and webmaster of www.Football-Data.co.uk

Fixed Odds Sports Betting investigates:

·Markets in fixed odds sports betting

·The bookmaker’s overround

·Value betting

·Ratings systems for sports prediction

·Profitability and risk

·Singles versus accumulators

·Staking plans and money management

·The favourite-longshot bias

·Sports advisory services

·Betting records and their significance testing

Marketing Points:

·Adopts a numerical approach to fixed odds sports betting

·Provides an in-depth examination of betting risk and money management

·Utilises extensive data analyses and staking plan computer simulations

·Invaluable reading for statistically-literate sports bettors

·Many useful ideas for the more casual punter

·Exposes some of the long-standing myths surrounding fixed odds betting

Nothing beats what your eyes see themselves when it comes to picking winning selections however the right stats and ratings can be a useful tool in every punter’s armoury. Here Darren Davies, launches his new look at ratings with a debut contribution to Progambler.

Onside

‘It’s better with a bet on’, and with Ladbrokes posting pre-tax profits of £235m for 2006, it just gets better and better. And it’s not like the Magic Sign are on their own, Gala Coral is the UK’s biggest private firm, Bet365 have increased their sales from £112m in 2002 to £986m last year, whilst BetFred have doubled their turnover from £387m to £874m in three years. Earlier in April, the eighth annual Profit Track 100, which ranks Britain’s fastest-growing private companies by average profit growth, listed spread betting firm SpreadEx, boosting profits 76% a year from £1.2m in 2003 to £6.4m in 2006, bookie StanJames, increasing its profit 70% a year from £1.1m in 2002 to £5.5m in 2005, and BetFair, where an average of 6m of bets matched every day helped profits surge 61% a year from £8.3m in 2003 to £34.6m in 2006. ’It’s better with a bet on’, as far as the bookmakers are concerned never were truer words spoken.

This article intends to guide the reader through the complex task of denying the bookmakers of some of their hard-earned prosperity. By concentrating on the fixed-odds markets for football betting I will show how it is possible not only to win, but to win consistently and ultimately to make an income. However, before reading on you need to ask yourself this question, ’why do I bet on football?’ If the answer is, ’to make it more interesting’, or ’cause I always back the Hammers’, or worse, ’that bleedin’ scorecast is bound to come in if I don’t’, then stop here and think nothing of it, this article is not for you. If, however, your answer is indeed, ’to make an income’, then read on.

Value Betting

It may well be that I am preaching to the choir, however the concept of value is so central to any winning punter’s thinking that I would like to reiterate a few basic principles and dispel some commonly held, and widely purported, myths regarding value betting.

Principle #1

In simple terms a punter has identified value when a bookmaker prices the outcome of an event at odds greater than the true odds of that event occurring. The assumption is that a skilled punter can identify such situations, a matter to which we shall return.

Principle #2

Where value has been identified the outcome has to be backed to occur, regardless of whether the punter thinks it will win or not, conversely, where the absence of value has been identified the outcome must not be backed, even when the punter in question believes it to be a stone cold certainty to occur, due to Principle #3.

Principle #3

Backing outcomes at odds greater than their true odds of occurring will guarantee a long-term profit, backing outcomes at odds less than their true of odds of occurring will guarantee a loss and will break your bank in the long run.     Now let’s dispel some commonly held myths.

Myth #1’Value betting means always backing outsiders’. Referring to Principle #1 it should be clear that this is the case only when the outsider in question is priced up by the bookmaker at odds greater than the true odds of it winning, otherwise Principle #2 applies and no bet.

Myth #2’There is no value in backing odds-on shots’. Again, Principle #1 applies, if the selection is overpriced, even at odds-on, value exists and Principle #2 demands a bet. In fact, Joseph Buchdahl, in his book Fixed Odds Sports Betting, argues that there is a such a thing as favourite-longshot bias, which he provides evidence for and that states bookmakers overprice odds-on favourites and underprice longshots, ‘in order to insure themselves against insider information and subsequent excessive liability’.

Myth #3’Value betting removes the element of skill in picking a winner’. Any fool can get lucky, it takes real skill to identify value, bookmakers are nobody’s fools, quite the contrary, and to figure out when they have made a mistake is the consummate punting skill.  To summarise, and to quote Buchdahl, whose approach outlined in his aforementioned book provides the basis for this analysis of football betting,’ Value-bet or don’t bet at all’, and finally and most pertinently, ’Find the value and the winners will take care of themselves’.

Finding the value

We have all experienced that feeling when we look down at the coupon and something just jumps off the paper screaming to be backed, that team, that opposition, and at that price. We know their going to win and we know the price is too big, in these cases follow your instincts every time. For ’feel’ is an important weapon in the successful punters arsenal, that gut feeling, the hunch you get is more often right than wrong and you should follow it every time. However, these experiences are usually few and far between and it can’t be forced, as soon as you start to look for it, by definition, it isn’t there. Give it up.  Often we ’fancy’ a particular team to win (or lose) and start to look for reasons to back (lay) them, usually they are a form team, running particularly hot or cold which is what alerts us and qualifies them as a ’fancy’. We start to look for team news, maybe we look into their home/away form more closely, even look at recent head-to head results, look up the football forums on the internet to see if there is any wisdom to be found in cyberspace. Based upon the results of this analysis we decide to invest some of our hard-earned money, and again, such endeavour is often rewarded.  Both these approaches can be described as a qualitative analysis. Making a judgment based upon available information. Few punters take the next step and quantify these factors, assign them a numerical value, and total them to provide a quantitative measure of the superiority of one football team over their opposition. This is essentially a Ratings System, the sophistication of which is dependant upon the amount of information used to determine the numbers, ranging from the very simple, say league positions and goals scored, to the very complex, incorporating league positions, goals scored and conceded, head-to-head record, match statistics (shots, corners, possession), home/away performance etc etc. Once the number crunching is done, the rating (the number for the away side subtracted from the number for the home side) for the match needs to be translated into the relative chances of a home win, a draw, and an away win, from which a judgment about available value can be made.

Developing a Ratings System I have developed and perfected my own ratings system over the last three years. The first step involves identifying a potentially profitable market, the second to develop a theory as to the factors that influence the outcome and to then quantify them into a ratings system. My first relatively unsuccessful attempts centred around correct score betting and the total goals markets. The former suffered from the huge overounds the bookmakers enjoy on these markets and the latter didn’t provide enough value with regard to the matches that the system was throwing up. The point to note here is that I tested a theory about the outcomes of football matches, what I learnt was not to test it in real time, rather back-test the theory against previous seasons results (much cheaper when the theory is wrong), and to choose markets that favour the punter rather than the bookmaker.Up until recently, pre-internet, it was impossible to bet singles on football matches, it was minimum trebles with the high-street bookmakers. The arrival of the internet and the subsequent competition it introduced to the market meant that betting singles on football matches soon became a reality. This is a punters market for sure; only three possible outcomes, low overound, widely available information, reliable form, lots of competition. Take a look at the table below:

Table 1. English Football % 1X2 2006/07

The results for this season are consistent with previous seasons. What struck me is that nearly half of all football matches end as a home win. This pattern is repeated year after year and across the football world. This seemed a promising market to investigate further. I theorized as to the factors that influence the outcome of a football match, listed and prioritized them, assigning them relative values and began to back test. A laborious task involving calculating a rating for each team for each match, converting it to a percentage chance of a home win and from there to ‘fair’ odds.The website www.football-data.co.uk provides access to results and statistics from previous seasons for the English, Scottish and major European leagues. Additionally, and crucially they also provide data on the odds available thus allowing an available value judgment to be made once the ratings system has provided the ‘fair’ odds.A good ratings system will model reality; it will predict the outcome of a football match. If, historically, this can be demonstrated it can be used with confidence in the future. My own system, developed through three years of back testing, the final year of which went ‘live’, so to speak, with real money, models

reality like this:

Table 2. Rating System results distribution

For the purposes of Table 2 the ratings from seasons 2004/05, 2005/06 and 2006/07 have been grouped by intervals of 5 and the corresponding percentage of home wins for each interval are shown, together with the total number of matches for each interval. If the ratings system is any good we should see a low percentage of home wins where there is a large negative rating, i.e., the home side has a rating much lower than the away side, whereas we should large positive ratings have a high percentage of home wins, where the home side has a superior rating to that of the away side.  

Doing the Math! A decent secondary education and you are more than capable of doing the maths required for this type of analysis. Even if you’re not, Excel is, though a word of caution, Excel only does what you tell it do, it has yet to develop the function that tells you you’re stupid and that you should really be doing it like this! Anyway, looking at Table 2 it seems that the ratings system is doing a decent job of describing reality. Again though we need to move from a qualitative description to a quantative analysis. In order to do this we need to consider the degree of correlation between the ratings and the number of home wins. Excel does this very well in the shape of a scatter graph and the resultant correlation coefficient.

Graph 1. Scatter Graph for Ratings and % of Home wins

The x-axis is the ratings, the y-axis the percentage of home wins and the points the plot for each interval. The regression line passes through these points as a line of best fit and R² is the correlation coefficient of the regression line. The value of R² can fall in the range of –1 to +1, where –1 would indicate perfect negative correlation and +1 perfect positive correlation. R² describes how much of the distribution of the ‘real’ data can be described by the ratings system; the closer to +1 the more of the distribution is described by the system. The R² value of 0.8101 indicates the system is a good description, a good model, of reality. Oftentimes R² can be expressed as a percentage, in this case 81%, however this does not mean that it predicts 81% of the results correctly (no such luck!), rather that it predicts 81% of the variance observed in the results, the remaining 19% of variance is not described by the system and is due to factors outside of the computations involved.The equation of the line is a mathematical description of any point on that line. The equation can be used to predict the percentage chance of a home win when we know the rating of any given match.  Let’s look at an example. Home team rating = 65Away team rating = 37 Match rating = 65 – 37 = 28 Equation of the line: y = 0.428x + 37.063 Where x = match rating and y = percentage chance of a home win. Therefore y, the percentage chance of a home win, is calculated as follows y = 0.428(28) + 37.063 y = 11.984 + 37.063 y = 49.047 We now know that for this match there is a 49.047% chance of a home win, close to 1 in 2, which we commonly know as 50-50 or evens. To convert this percentage to decimal odds we need to do the following calculation, 100/49.047 = 2.04 So, now we know that, according to the ratings system, the ‘fair’ odds for the home win are 2.04. Using decimal odds as opposed to fractions allows easier comparisons to the odds available and subsequent value judgments. Let’s say that our favourite bookmaker has priced the home win up at 2.25, well then we have identified value and Principle #2 demands we have a bet. If however the odds are a miserly 1.87 then there is no value to be found and therefore no bet. Of course if we shop around we might get 2.1, and we’ll probably be able to get 2.24 on BetFair, in each case a bet is warranted.For my own purposes I compare my ‘fair’ odds to the average odds for the home win as shown on BetBrain and take it from there. Conveniently football-data collate this information for ready analysis.

Results

Looking at three seasons results, backing each match where value is identified on BetFair, the results are as follows:

Three consecutive seasons of profit, yield is defined as the percentage profit on turnover, and certainly for 2004/05 and 2005/06 this is more than acceptable, for 2006/07 less so. In 2004/05 I back tested only against the Premiership, in 2005/06 the Premiership and the Championship whereas for 2006/07 the data comes form the Premiership, the Bundesliga, Serie A and the Spanish Primera. During this time it has been clear to me that certain sub sets of ratings are performing better than others. This is illustrated by the following table:

Table 3a. Ratings sub sets

Grouping the sub sets into less than or equal to 30 and greater than 30 reveals a clear pattern. That being that returns are maximized by only betting on matches with a rating below 30. Table 3b. Sub set groupings

Note. Detailed results from 2004/05 unavailable Why is this the case? I have no definitive answer, a few theories, that these are for the most case evenly matched teams where home advantage is decisive for example, or that in extreme cases with low or even negative match ratings we are looking at the ‘minnow effect’, where unfashionable teams at the bottom of the leagues play host to one of the top four or five teams in the league and raise their game, or maybe the top teams are somewhat complacent and lower their performance, or a combination of both. Another possible explanation is that these unfashionable teams are under-estimated by the bookmakers; or rather their more illustrious visitors are under-priced based upon reputation, players, coach etc. thereby overpricing the hosts in relation to their actual chances, or ‘fair’ odds. Whatever the explanation there seems to be a niche to be exploited here.

Conclusions

The ratings system produces an average yield of 19%. Any self respecting tipster or system would be more than satisfied with such a return given that it has the potential to generate over 200 bets per season. With three years of supporting data the system can be said to be both reliable and valid, that is the results are repeatable given similar conditions, and that it measures accurately what it is designed to, i.e. the superiority of one team over another, or as one of my favourite adverts on TV used to say about it’s product, ‘it does exactly what it says on the tin..’. Personally speaking, the motivation to develop such a system is not so much about making money but about how to beat the bookmakers at their own game. Of course, it would be disingenuous of me to say that making money isn’t a motivating factor, it is, simple as that, but the satisfaction comes from knowing that I can better predict the correct odds for a football match than the combined forces of the bookmaking fraternity, and given my Dad’s cautionary wisdom, ‘that you never see a bookie on a bike’, then that is no mean feat indeed. In order to help you develop your own system I intend to explore in greater detail the factors that influence the outcome of a football match, what constitutes form, how long form is valid over, how to quantify home advantage and how to quantify the quality of opposition. Additionally I intend to show how to use Excel to both help collate all this information and to do all the number crunching subsequently. Unfortunately a ratings system, a good one at that, isn’t a promise of financial success without the understanding of the importance of a bankroll, of a staking plan or of risk management. Otherwise it all can be a waste of time, effort and of course, money. On a positive note such an understanding can maximize your profits, for example, taking the 2006/07 season and backing all matches with a rating under 30 to level stakes produces a finishing bankroll of 921.4 points from a starting bankroll of 500. However, using a particular staking plan, virtually risk-free, the bankroll swells to an impressive 3407.2 points.  Well worth the effort of time and energy I think you will agree.