3 categories of punters

[zbrochu]

Hi guys, I've just finished writing an email to one person and I thought it would good idea to share this thoughts with you to maybe expand it a bit more in discussion. There are 3 categories of punters: 1) The guys that have math model, a very rare bread. Often they are math and stats wizard, stuggling and working on their stuff for many many years. It is important to know what sports they bet on and what stats they use. The more popular sport, the hardest it is to beat (with NBA spreads leading the pack). MLB, NFL and football big leagues are very tough too. Eurohockey, eurobasket and other low liqudity sports are better. As far as stats are concerned, the best are players based models where every player is evaluated (by his number of shots, accurate passes, tackles dribbles etc. depending on sport) and from this individual ratings overal team strenght is derived. Team-based stats are good too assuming one has access to detailed stats of teams like ball posession. If one relies only on goals scored/goals allowed he is in very very tough spot as bookmakers have amazingly accurate model for that and their numbers are sharpened by market that is affected by team news, injuries information etc. The model is like a holy graal - super difficult to find but once it is created, it can produce as many as 500 winning bets per month. 2) The guys who have "insider information". They usually specialize in some narrow fragment of any sport or market, for example Serbian Basketball. They know a lot about coaches and teams' dynamics. What players were sold, what bought and if they are good. What players are injured or suspended, what players have diarrhea this week and who is conflicted with manager. What teams struggle financially, what teams are motivated about Cups but not the league or other way around. I believe this guys can have long-term edge over bookmakers because they use information that bookmakers don't. Of course market frequently is affected strongly by this kind of information and odds are influenced . They drop a lot and drop too much so it is no longer a good betting opportunity, but all in all I think it is way to go for people who are not math wizards with deep pockets for buying expensive databases and programmers. 3) The guys who "think" they have insider information but they really don't. 90% of bettors are in this category and they don't achieve long-term edge over bookmakers. Their analyses include information that bookmakers already priced-in in odds: Example 1: "I believe Team A is better because they are in very good form at home and they have better h2h stats from previous years vs Team B". Example 2: "I watched last games of Team A and Team B and I saw they both have weak defenses and I expect a low scoring game". Example 3: "Team A is very good team , a runner-up from previous year and after few bad games they must start winning!". Example 4: "Team A have average of 3.2 goals this season and Team B have average of 2.7 goals this season. Easy over 2.5 bet". All this examples are wrong in terms of possibility of achieving profits. All this information are included in the odds. It is not that difficult to know that game A is likely to be high scoring game. But the point is to know if this game is more likely to be high scoring that bookmakers' odds suggest. Example: There is fourth round of Dutch league and there is a game betwene teeam that had 2-4 3-3 5-4 and 3-2 results and team B who had 4-1 3-3 2-2 and 2-3 results. Both teams are high scoring and high "allowing" and many people would be inclined to take bet between these teams as OVER. But bookmakers know this results too! What if they set line for this game differently and instead of giving OVER 2.5, they give OVER 8.5 goals 1.9/1.9 odds. Would you still want to take OVER in this game? I don't think so , you would be more inclined to bet UNDER. So as Einstein said, everything is relative and so should be our predictions and estimations. "Do I believe there will be more goals in this game that bookmakers think?" instead of "Do I believe there will be many goals in this game" or "Do I believe this team is bigger favourite that -1.5 1.85" instead of "Do I believe this team is very likely to win this game" Nothing new, some obvious stuff for many of you but I think it is worth recalling.

[AlanJenkins2]

Re: 3 categories of punters Excellent stuff,Zbrochu.Of course,there are also the 'mugs' who will just bet on team 'A' because they think they will beat team 'B',or put lots of odds-on bets in accumulators.They are the people the traditional bookies most want.

[Max2112]

Re: 3 categories of punters Yup Mugs are missing from the list Anyone who has worked in a bookies will also add "Penny Punters" - those little old men with 2p combination 7-folds who the bookies hate because they can win thousands with a very small outlay Also Arbers are missing - they don't care about form or even which team will win - just content to make a small profit whatever the result :)

[zbrochu]

Re: 3 categories of punters I think the 'mugs' are partly included in third category AJ. Good point about arbers and BF traders and middlers - this is definately a fourt category. Money management skill is different universe. If someone does not have it, he is screwed regardless if he has a winning strategy or not. It is why many sports journalists with encyclopedic knowledge or stats professors and geniuses are poor at betting - you get money management skills mostly by making bets, making mistakes and loosing money :)

[Jase82]

The irony is that all gambling is a mugs game :lol Recent modernization has bred a section of snobbery amongst gamblers. Someone's a 'mug' for taking this bet or that bet, everyone giving off the impression they have the answer. Its all bullshit.

[Max2112]

Re: 3 categories of punters

The irony is that all gambling is a mugs game

Very true At least with arbing you can only be a mug through your own ineptitude :D

[AlanJenkins2]

Re: 3 categories of punters The punter who thinks he has insider knowledge but doesn't is still clever enough to use odds comparison sites.So he will get banned by firms like Stan James and Betfred,who want punters who will bet with them when they aren't offering the best odds.

[jtw1]

Re: 3 categories of punters

The irony is that all gambling is a mugs game :lol Recent modernization has bred a section of snobbery amongst gamblers. Someone's a 'mug' for taking this bet or that bet, everyone giving off the impression they have the answer. Its all bullshit.

Possibly the most honest and true statement ever posted in the history of internet betting forum's..well said Jase :clap

[negapo]

Re: 3 categories of punters To add a little something Bettors do not race against bookmakers, they don't need to beat them. Bookmakers don't care (or they shouldn't) if in the prices they offer there is a huge miss valuation on one selection. They just want to find the equilibrium between the different bettors, that sweet spot. Take an example. Bookie A feels the true probabilities of a soccer match are: Team A to Win: 36% Team B to Win: 34% Draw: 30% So they make the odds (decimal) like: Team A to Win: 2.77 Team B to Win: 2.98 Draw: 3.30 They run it to expert A who tells the math guy: People are crazy about Team A, they have scored 5 goals on their last game and people will inflate their probability of winning (he is basing he's analysis on some bias that bettors have). We don't want to get hit on that selection so squeeze that odd. I think punters will settle for a market like this, says the expert: Team A to Win: 2.38 Team B to Win: 3.23 Draw: 3.70 So the bookie takes it and then applies their 3.5% margin across selection and final odds look like this (they can also take their margins unevenly): Team A to Win: 2.32 Team B to Win: 3.11 Draw: 3.55 So the bookie thinks is offering the odds for Team B with value, 3.11 against the fair odds estimate of 2.98, but he doesn't care as long as people find it in equilibrium and bet accordingly on every selection. When you bet on team B that has a lot of value that value is coming from the suckers that bet on Team A (and good punters that bet on draw that has value also). This is the magic of betting and the reason why there can be bookmakers like Pinnacle. Not every bookie is like this, there are bookies who just don't like winners, and there are bookies who take risks and like to be open on some selections that they find to be valuable. So, following the line of thought, there is a subtle variation of the stats/math guy: You don't need to model the game, you can model the bettor. Imagine that people undervalue favorites (like the favourite longshot bias) in a regular basis. So bet the favourite, ignore the game, the rules, etc. In financial markets they call it behavioural finances (thet study of how people act and not how should they be acting). It's a little bit like the difference between how the world should function (the true odds of a game, the true value of a stock, etc.) vs. how the world functions (people overreact to big wins, people overvalue things they love like Apple and it's stock, etc.) If you know where people make their mistakes and they make it on a regular basis then you can make a living out of it (the marketing guy make that).

[zbrochu]

Re: 3 categories of punters Maybe in ninety-nineties bookmakers' purpose was to set odds that divide action evenly but not any more. Unfortunately..

[AlanJenkins2]

Re: 3 categories of punters Why unfortunately ? If the bookmakers bet to a certain margin,but they choose to take more on one selection,then they must be taking less on another.So that makes them easier to beat on the selection they are taking the smaller percentage on.

[negapo]

Re: 3 categories of punters If that was true then bookmakers would not change lines frequently when there is no new relevant information coming in, this is, they would not move their lines with the pressure of punters betting unevenly in one selection. What you see today is bookmakers subscribing to odds API that continuously check their prices against the competition, they are in an effort not to model the game properly but to move rapidly with the market. This is a global world where information flows continuously, and it's more comfortable to make a book and go with the flow than it is to win money by betting against punters (on a head to head of who knows more). I give you this, there are in fact a few bookies that when odds move a lot from the initial published prices that suspend the market (they stop offering odds). This could signal that they are not willing to make a book on those odds but what is more probable is that they don't want to participate in a market where volatility is high. The bookies final goal is to make money by making a market, not by betting against clients. If they have a superior way of modeling the game they don't need to be a bookie, spend a lot of money on marketing, have a crew of employees on a payroll to model the odds, give costumer assistant, share revenues with money wallets, have the entire liability of running a business. (They need some skill in modelling the odds of course if they want to publish their prices early). You can find parallel in financial markets where when you sell something (make an IPO, you are trading stocks) you usually don't ask yourself how much is this worth but how much are people willing to give to me for this.

[negapo]

Re: 3 categories of punters AlanJenkins2, I was answering zbrochu in my post (i cant edit posts :( )

[zbrochu]

Re: 3 categories of punters

Why unfortunately ? If the bookmakers bet to a certain margin,but they choose to take more on one selection,then they must be taking less on another.So that makes them easier to beat on the selection they are taking the smaller percentage on.

Unfortunately because it would be easier for punters to beat bookmakers if bookmakers' goal was to divide action instead of making accurate odds. Then sophisticated players would just blindy bet against "public" teams and bets to make profits. It was possible in the past, sharp players mostly bet unders and dogs, because bookmakers shaded few points knowing people will always take favs and overs anyway.

If that was true then bookmakers would not change lines frequently when there is no new relevant information coming in, this is, they would not move their lines with the pressure of punters betting unevenly in one selection. What you see today is bookmakers subscribing to odds API that continuously check their prices against the competition, they are in an effort not to model the game properly but to move rapidly with the market. This is a global world where information flows continuously, and it's more comfortable to make a book and go with the flow than it is to win money by betting against punters (on a head to head of who knows more). I give you this, there are in fact a few bookies that when odds move a lot from the initial published prices that suspend the market (they stop offering odds). This could signal that they are not willing to make a book on those odds but what is more probable is that they don't want to participate in a market where volatility is high. The bookies final goal is to make money by making a market, not by betting against clients. If they have a superior way of modeling the game they don't need to be a bookie, spend a lot of money on marketing, have a crew of employees on a payroll to model the odds, give costumer assistant, share revenues with money wallets, have the entire liability of running a business. (They need some skill in modelling the odds of course if they want to publish their prices early). You can find parallel in financial markets where when you sell something (make an IPO, you are trading stocks) you usually don't ask yourself how much is this worth but how much are people willing to give to me for this.

Yes, this is obvious bookmakers change odds as a result of money wagered. If they get more action on one team, they lower odds to balance the action to secure margin-profit regardless of the result. This is some obvious stuff. But we discussed about starting odds before. You suggested bookmakers set odds to divide action evenly and I disagreed claiming that they set starting odds very accurately, to refelect true probabilites. For example if there is Manchester United - Cardiff game and their estimations show that Manchester is -1.25 favourite then they set starting handicap as -1.25. If they were to divide action, they would set the line -1.5 or -1.75 because they know most bets will be on hot favourite - Manchester so they would shade some quarters of AH to make an easy profit. It is how it worked in the past. Now, if they were to set -1.75 handicap for this game (-0.5 jandicap difference from their true predictions), big syndicates and intelligent players would jump in to take Cardiff +1.75 and this be very risky and exposing for bookmakers. They would be out of business in few months.

[negapo]

Re: 3 categories of punters zbrochu Let me try to clear some of my earlier thoughts: If there is no new relevant information coming to the market (like an injury, or something similar) and the odds are volatile to the point that the Highest historical odd on every selection made a "sure bet" (the highest odds summed more than 100%) then there was a moment where a selection presented value (this is by definition). This happens many times. Another thought is that a Bookie prefers to make a perfect book knowing that it will win money no matter the outcome than to leave a selection open even if he thinks it has value. With this two thoughts (and the other arguments on the previous post) i think someone has to conclude that the Bookie will aim to publish the odds in a way that he expects to be inline with the demand and not with the fair odds. He can, if he thinks the balanced odds are to far from the fair odds, not publish the odds, increase the margins or wait to see some action in the market before he publishes. And i think you are saying the same:

Unfortunately because it would be easier for punters to beat bookmakers if bookmakers' goal was to divide action instead of making accurate odds. Then sophisticated players would just blindy bet against "public" teams and bets to make profits. It was possible in the past, sharp players mostly bet unders and dogs, because bookmakers shaded few points knowing people will always take favs and overs anyway.

If punters will hit one of the selection then that's not dividing the action. What i think you are saying is that punters are now more sophisticated and there is a bigger alignment between what the bookies/experts think are the fair odds and the equilibrium odds.

Yes, this is obvious bookmakers change odds as a result of money wagered. If they get more action on one team, they lower odds to balance the action to secure margin-profit regardless of the result. This is some obvious stuff.

That idea of changing odds is part of what i think supports my argument. The discussion went off topic (Three Styles of Punters).

[christos83]

Re: 3 categories of punters Such kind of discussions are needed for everyone and in my opinion should be done more often here....Unfurunatelly I am still a number 3 punter...so why not try to think in a different way..Great topic. Thanks

[MPLouis]

Re: 3 categories of punters

There are 3 categories of punters:

zbrochu, Out of interest, which category of punter are you?

[Jase82]

For example if there is Manchester United - Cardiff game and their estimations show that Manchester is -1.25 favourite then they set starting handicap as -1.25. If they were to divide action, they would set the line -1.5 or -1.75 because they know most bets will be on hot favourite - Manchester so they would shade some quarters of AH to make an easy profit. It is how it worked in the past. Now, if they were to set -1.75 handicap for this game (-0.5 jandicap difference from their true predictions), big syndicates and intelligent players would jump in to take Cardiff +1.75 .

I don't understand when people say bookmakers set the line at something because with the alternative handicaps market you can bet pretty much any line you want. Surely it's the odds rather than the line. Bookmakers don't "set" a line.

[infinity]

Re: 3 categories of punters Good thread! I remember a professional gambler saying that only one in 200 punters is expected to make profits in the long run.

[AlanJenkins2]

Re: 3 categories of punters The bookies initially 'set a line' on the asian handicap where they think the odds will be closest.For example,if a team is 1.4 to win,it might be 1.92 minus 1.25 on the asian,and its opponents might be 2.00 plus 1.25.So that would be the opening 'line'. Of course,other lines would be available later,closer to the start of the game.