Money Management in Sports Betting
Sports bettors need to do a lot of things right if they want to have any chance of winning over the long run. Making accurate picks is only one piece of a much larger puzzle. Before you can really start to turn a regular profit, you will to have to master one of the most challenging aspects of sports betting: bankroll management. By making some simple changes to your betting strategies, you can protect yourself from losing streaks and allow your skills to produce a net profit in the long run.
Make Smaller Bets
Almost all recreational sports bettors make bets that are far too large. This is a serious mistake for a number of reasons, but one really stands out: variance. Remember, bookmakers offer relatively fair odds. Even if you are a very savvy bettor, your statistical advantage will always be small. In order for you to take full advantage of this edge, you need to make a large number of bets and, therefore, offset some of the risk due to variance. Some of your wagers will lose, but even more will win (assuming that you are actually skilled). If, like most bettors, you were tying up your entire bankroll in only a handful of bets each week, you would be exposing your money to huge swings due to variance.
So how large should each of our bets be? Most experts would recommend 1%-3% of your total bankroll, but going up to 5% is reasonable for bets that you are very confident about. For example, a player who wants to bet a total of $1,000 could make forty $25 bets (2.5% each). This would spread the money around and insulate him from losing a large portion of his bankroll due to variance.
Using this strategy is a good idea statistically but it does have some downsides. By making smaller bets, your gambling will become much less exciting. A lot of small wins will never be nearly as exciting as one big score. This is also a much more difficult way to bet. It takes significantly more time and information to make several dozen educated bets than it does to make four or five obvious ones. In fact, this kind of ideal bankroll management strategy will force most players into making wagers on teams (and even sports) that they didn’t have to consider about in the past.
Limit Your Exposure
There are no sure things in sports betting and even the best bettors occasionally go on expensive losing streaks. This brings up an interesting question about how much of your bankroll should be in play at any one moment. Every dollar that you bet has the potential to be lost but every dollar in your pocket is completely stagnant. The opportunity cost of holding on to your money and the risk associated with gambling are opposing forces that need to be balanced. This is a completely personal decision based on the size of your bankroll and your risk tolerance, but when making this decision, keep the worst-case scenario in mind. If you lose all of your outstanding bets, make sure you have enough money in reserve to get back in the game. It should go without saying that you should never bet more than you can afford to lose or gamble with money that you need for important non-gambling life expenses like paying bills.
Give Your Bankroll The Best Chance
After you have made your picks, it’s time to find the best odds possible. This means shopping around and seeing what different online sportsbooks are offering. It can be a time consuming process, but you are making an effort to take every advantage possible, and that’s what makes all of the difference. This also means that you will need to have player accounts with several different sportsbooks. Check out the reviews on this website to find the safest online sportsbooks with a reputation for great odds.
Keep Track of Your Money
If you follow all of the above advice, there is a very real risk that you will lose track of your bankroll. You will be spreading dozens of bets over multiple sportsbooks on a regular basis. In order to know how well you are doing while ensuring that you are being paid properly, it makes a lot of sense to start a betting journal. Write down each bet as you make it, it’s location, size, and the odds associated with it. Then, record and sum all wins and losses to chart your own performance. Over the long run, this journal will help you to identify recurring mistakes and further optimize your money management strategy.