Now this is where things get very complicated because many more variables and options come into play. Now remember we are assuming lines of -110 and that you are equally confident in all teams and thus disperse your money equally among them. First lets list all of the options you have:
Bets on all 4 teams separately
Bet on two teams individually and 2 game parlay the other two
Bet on 2 two team parlays
Bet on one team separately and have a 3 game parlay
Or put all of the teams into a 4 game parlay
Now the question becomes, which should you do? We've already calculated the break even point for some of these options which included:
Separate bets: 52.4%
Two-game parlay: 52.7%
A 4-game parlay: 54.91%
So when do the other options break even?
2-game + 2 Separate Side Bets
Well in a two-team parlay with two separate side bets there are a couple more possibilities. Now since we are assuming equal dispersion of funds, you would have $50 in your 2-game parlay and $25 on each side bet. The possibilities include:
Winning all bets= 2.6(50)+(.91)(25)+(.91)(25)= $175.4
Win the 2-game parlay, win one side bet, lose the other= 2.6(50)+(.91)(25)-25= $127.7
Win the 2-game parlay, lose both side bets= (2.6)(50)-50= $80
Lose 2-game parlay, win both side bets= (.91)(25)(2)-50= -$4.5
Lose the 2-game parlay, lose one side bet, win one side bet= (.91)(25)-75= -$52.3
Lose all bets= -$100
Now from, that payment scale it looks pretty favorable, but in actuality it isn't. There are a lot more possibilities of loss than of winning.
Odds of winning all: 1/16
Odds of winning two-game and splitting other: 2/16
Odds of winning two-game and losing separates: 1/16
Odds of losing two-game and winning side bets: 3/16
Odds of losing two-game and splitting other: 6/16
Odds of losing all: 3/16
On an average $100 bet you are losing $7.25.
After all of the calculations you find that you break even at 52.59% roughly.
Next up is the 3-game parlay with a side bet.
3-Game Parlay + 1 Separate Side Bet
The possible outcomes of this bet include:
Winning all bets= 75(6)+25(.91)= $472.75
Winning the 3-game parlay and losing side bet= 75(6)-25= $425
Losing the 3-game parlay and winning side bet= 25(.91)-75= -$52.3
Losing all bets= -$100
The odds of each occuring:
Winning all bets= 1/16
Winning 3-game and losing side= 1/16
Losing 3-game and winning side bet= 7/16
Losing all bets= 7/16
On the average $100 bet you would be losing $10.50 per bet.
After all of the calculations you break even at 52.285% roughly.
Interestingly enough, this is the lowest break even point of all betting strategies that we have gone over.
So for reference:
Break Even on 4 separate bets: 52.38%
Break Even on 4-game parlay: 54.91%
Break Even on 2-game parlay with two separate side bets: 52.59%
Break Even on 3-game parlay with one separate side bet: 52.285%
Break Even on two 2-game parlays: 52.7%
In the next article we'll evaluate when each betting strategy becomes advantageous over the others.
Thursday, January 27, 2011
Monday, January 17, 2011
Three Team Betting Strategies
Now, you would think this is where things become much more complicated because there is another option to use to bet (a 2-team parlay with a side bet on a single team), but in actuality it is just as simple as our prior example. Why? Because it is NEVER advantageous to the gambler to do a 2-game parlay and one side team bet on 3 teams that they are equally confident on. Just use this as a rule to live by in gambling, because mathematically speaking there is no reason to bet on a 2-team parlay and a one game side bet (assuming equal dispersion of funds and equal confidence).
So this only leaves two options, parlaying the 3 teams or betting on each separately. So when does one become advantageous over the other? Well reference my first article that drives a little deeper into this issue. For a little summary of everything:
Straight bet:
Win all 3: $91
Win 2, Lose 1: $27
Win 1, Lose 2: -$36
Lose all 3: -$100
Parlay:
Win: $600
Lose -$100
Times each can occur on a single bet:
Win all 3= 1
Win 2, Lose 1= 3
Win 1, Lose 2= 3
Lose all 3= 1
Times each can occur on a parlay:
Win= 1
Lose= 7
After all of the calcuations it was concluded that both bets would earn you the same amount at 52.23% where you are losing about $0.25 per bet.
It is interesting to note that 3-game parlays actually pay off better even before the break even point of both bets.
So in conclusion:
If you're winning percentage is below 52.23% then bet on each team individually
If you're winning percentage is above 52.23% then parlay the bet
Never do a 2-team parlay with a side bet of one team (you are better off either parlaying them all or betting on each separately)
So this only leaves two options, parlaying the 3 teams or betting on each separately. So when does one become advantageous over the other? Well reference my first article that drives a little deeper into this issue. For a little summary of everything:
Straight bet:
Win all 3: $91
Win 2, Lose 1: $27
Win 1, Lose 2: -$36
Lose all 3: -$100
Parlay:
Win: $600
Lose -$100
Times each can occur on a single bet:
Win all 3= 1
Win 2, Lose 1= 3
Win 1, Lose 2= 3
Lose all 3= 1
Times each can occur on a parlay:
Win= 1
Lose= 7
After all of the calcuations it was concluded that both bets would earn you the same amount at 52.23% where you are losing about $0.25 per bet.
It is interesting to note that 3-game parlays actually pay off better even before the break even point of both bets.
So in conclusion:
If you're winning percentage is below 52.23% then bet on each team individually
If you're winning percentage is above 52.23% then parlay the bet
Never do a 2-team parlay with a side bet of one team (you are better off either parlaying them all or betting on each separately)
Sunday, January 16, 2011
Two Team Betting Strategies
This will probably be my shortest and most simple post because with two teams you really only have two options, a 2-team parlay or bet on each. Now lets assume in all of these strategies that you are equally confident in all teams, therefore you should dispense your money equally on all of them. For example, if you had 3 teams you liked equally and wanted to bet on one individually and two in a parlay then you should put $33.33 on the single team and $66.67 in the parlay. So in a two team betting strategy you should always have $50 on each team (assuming our $100 standard). Now the question becomes when do you parlay the two and when do you bet on them separately? The answer, as always, comes down to winning percentage.
From our reference in the post before, 2-game parlays have a break even point of 52.7%. Since it is a parlay if you are below the break even point then you are losing worse than if you bet individually. Therefore, if you are below 52.7% you shouldn't parlay the two.
However there is a point where the 2-game parlay does become more profitable. Now like the 3-game parlay example in my first post, there are a certain amount of outcomes that can happen. One outcome of winning both, two outcomes of splitting, and one outcome of losing both.
Straight bet:
Win both= $91
Lose both= -$100
Win one, lose one= -$4.5
Parlay:
Win= $260
Lose= -$100
Approximately 53.06% is the point where you would be making the same on both bets (about an average of $1.33 or $1.34 per bet)
So in conclusion:
If you're winning percentage is below 53.06% make the bets separately
If you're winning percentage is above 53.06% parlay (if you meet all the criteria I mentioned in the first article)
From our reference in the post before, 2-game parlays have a break even point of 52.7%. Since it is a parlay if you are below the break even point then you are losing worse than if you bet individually. Therefore, if you are below 52.7% you shouldn't parlay the two.
However there is a point where the 2-game parlay does become more profitable. Now like the 3-game parlay example in my first post, there are a certain amount of outcomes that can happen. One outcome of winning both, two outcomes of splitting, and one outcome of losing both.
Straight bet:
Win both= $91
Lose both= -$100
Win one, lose one= -$4.5
Parlay:
Win= $260
Lose= -$100
Approximately 53.06% is the point where you would be making the same on both bets (about an average of $1.33 or $1.34 per bet)
So in conclusion:
If you're winning percentage is below 53.06% make the bets separately
If you're winning percentage is above 53.06% parlay (if you meet all the criteria I mentioned in the first article)
The Break Even Points
For gambling, there is a certain winning percentage needed to be profitable in the long run.
For straight bets its 11/21 which equals 52.4% (assuming a line of -110)
For a 3-game parlay a gambler would break even by winning 16.7% of the time (1/6) since the payoff is 6 to 1. In terms of individual games a gambler would have to be above a 52.275% to start making money.
So this shows that you actually break even on a 3-game parlay with a lower winning percentage than with straight bets. However, this doesn't hold true with the more games you add to the parlay.
The standard payout is as follows assuming a $100 bet:
Straight bets= -110 (win $91)
2-game parlay= +260 (win $260)
3-game parlay= +600 (win $600)
4-game parlay= +1000 (win $1000)
5-game parlay= +2000 (win $2000)
As a reference here are the break even points in terms of winning percentage on individual games on straight bets and 2-,3-,4-, and 5-game parlays.
Straight bets= 52.38%
2-game parlay= 52.7%
3-game parlay= 52.28%
4-game parlay= 54.91%
5-game parlay= 54.39%
Its an interesting note that 3-game parlays versus 2-game parlays and 4-game parlays vs. 5 game parlays. Now the question becomes, since 5-game parlays require such a high winning percentage, why bother with them? The reason is the higher you winning percentage goes beyond that benchmark, the more you win with a parlay with more teams. So really sucker bets are 2-game parlays and 4-game parlays which both require a higher winning to break even and don't pay out as well as 3-game parlays and 5-game parlays, respectively, as your winning percentage climbs.
So in conclusion avoid 2-game parlays and 4-game parlays, in terms of long term payoffs they falter when compared to 3-game and 5-game.
In the next part I'll show what would be most profitable (or less damaging) at every winning percentage.
For straight bets its 11/21 which equals 52.4% (assuming a line of -110)
For a 3-game parlay a gambler would break even by winning 16.7% of the time (1/6) since the payoff is 6 to 1. In terms of individual games a gambler would have to be above a 52.275% to start making money.
So this shows that you actually break even on a 3-game parlay with a lower winning percentage than with straight bets. However, this doesn't hold true with the more games you add to the parlay.
The standard payout is as follows assuming a $100 bet:
Straight bets= -110 (win $91)
2-game parlay= +260 (win $260)
3-game parlay= +600 (win $600)
4-game parlay= +1000 (win $1000)
5-game parlay= +2000 (win $2000)
As a reference here are the break even points in terms of winning percentage on individual games on straight bets and 2-,3-,4-, and 5-game parlays.
Straight bets= 52.38%
2-game parlay= 52.7%
3-game parlay= 52.28%
4-game parlay= 54.91%
5-game parlay= 54.39%
Its an interesting note that 3-game parlays versus 2-game parlays and 4-game parlays vs. 5 game parlays. Now the question becomes, since 5-game parlays require such a high winning percentage, why bother with them? The reason is the higher you winning percentage goes beyond that benchmark, the more you win with a parlay with more teams. So really sucker bets are 2-game parlays and 4-game parlays which both require a higher winning to break even and don't pay out as well as 3-game parlays and 5-game parlays, respectively, as your winning percentage climbs.
So in conclusion avoid 2-game parlays and 4-game parlays, in terms of long term payoffs they falter when compared to 3-game and 5-game.
In the next part I'll show what would be most profitable (or less damaging) at every winning percentage.
Friday, January 14, 2011
The Parlay Myth
I know there are a lot of people out there like me who are obsessively addicted to sports betting. One of the more intriguing options on a sports bet is to do a parlay. Parlay are often viewed as the "lottery ticket" of sports betting. The get-rich-quick scheme of the gambler. However, do they actually work? Is this a good means earning that little extra side cash in the long run? The answer really comes down to simply mathematics.
Most Vegas spread odd parlays are at payouts of a -110 line (which means for every $100 you bet you have an opportunity to win approximately $91). Since spread odds are seen as 50/50, the -110 line gives the house an edge. With these same odds in mind the typical 3 game parlay card will pay out at 6/1.
For those that may be new to sports betting I'll digress a bit into what a straight odds parlay is. You place a bet on 3 teams to all win. If you lose one or push (hit the exact number on the spread) on any game you lose the full amount. However if you win all 3 the payout is significantly larger than if you were to simply bet on each team individual (in the case of this example you would be $600 for a $100 bet).
Now the question becomes: When does it become advantageous to the gambler to use a parlay rather than making 3 separate bets? The answer lies in a gambler's winning percentage in the long run (this is assuming prior betting statistics would hold for the future).
WARNING: If algebra makes your head hurt just look at the totals I came up with and assume I know what I am talking about.
Now lets assume you want to bet on 3 teams (A, B, C) and you have $100 dollars to spend. You are equally confident in them so if you bet on them separately you will equally dispense the money.
Dartboard Strategy:
First lets assume you use the dartboard strategy and pick the three games that the darts land on first. By doing so you've given yourself a 50% shot of winning each game.
.5*.5*.5= .125
This is the likelihood you will either win all of your games or lose all of your games. You will either win $91 or lose $100.
3*.125= .375
Their are three possibilities each for making 1/3 or 2/3 correct. A could win, but B and C lose. A and C could win, but B loses. And I think you get the point. If you go 1-2, you will lose roughly $37. If you go 2-1 you will win roughly $26.
(.125)(-100)+(.375)(-37)+(.375)(26)+(.125)(91)= -7.125
So on an average $100 bet you would lose $7.13 (the house advantage rears its ugly head).
Now if you chose to parlay your dartboard picks:
(.125)(600)+(.875)(-100)= -12.5
You are losing $12.50 on your average parlay.
Well gee willickers I guess I ain't too shabby at sports betting (52% WP)
Now lets say you are better than the average joe schmoe at sports betting and your winning percentage is actually at 52%. Using the same math as our prior example:
.52*.52*.52=.1406
The odds that you win all of your games
.48*.48*.48=.1106
The odds you lose all of your games
.48*.52*.52*3=.3894
The odds you win 2 and lose 1.
.48*.48*.52*3=.3594
The odds you win 1 and lose 2.
Average payout on 3 bets:
.1406(91)+(.1106)(-100)+(.3894)(26)+(.3594)(-37)= -1.4388
Still losing money at $1.44 per bet which sucks but hey, at least we have our health (maybe?). And at least our knowledge has helped close the gap.
Parlay:
(.1406)(600)+(.8594)(-100)= -1.58
Wowzers, that winning percentage really closed the gap. Now we are only losing $1.58 per parlay, however it is still advantageous to do separate betting in terms of average return.
Broesph, I am so much better at sports betting than you.
Now lets say you are quite the above average sports better. You win 54% of the games that you pick consistently. Lets go through the math again (ugh):
.54*.54*.54= .1575
Odds you win them all
.46*.46*.46= .0973
Odds you get skunked
.46*.54*.54*3= .4024
Win 2, Lose 1
.46*.46*.54*3= .3428
Win 1, Lose 2
Straight Bets:
(.1575)(91)+(.0973)(-100)+(.4024)(26)+(.3428)(-37)= 2.3813
Hey, look at you, you finally made something. You are making $2.38 per series of bets.
Parlay:
(.1575)(600)+(.8425)(-100)= 10.25
Holy raveoli, that certainly jumped up. You are now making $10.25 per parlay. It was become advantageous to you to actually bet using a parlay rather than 3 separate games
So the conclusion would be if you can consistently win at sports betting 52.2ish% of the time, 3 game parlays would actually be a good bet in the long run. Because this article is running a little long I'll create a Part II showing my calculations for that and also the winning percentages required to win a 4-and 5-game parlay (be aware the percentages climb with the more games added).
Now the task is on you to keep track of your winning percentage and use this as a general to see if parlays are advantageous.
I apologize for the algebra lesson, I'm sure we all took enough math classes in our lives but lets move onto other criteria to consider if you choose a parlay.
First of all you must be as confident in all of your picks as you have been for your past picks. If you are simply "throwing" games into a parlay than you draw your winning percentage back down towards 50% (also a note, if you are below 50% winning percentage the less advantageous parlays become. So if you are below 50% DO NOT PARLAY and I repeat DO NOT PARLAY). Finding an amount of games within a single day can be difficult to do.
Also, parlays are much more risky and you can easily lose your money a lot quicker. You need to have a good base of money to work this strategy with, you will go through parlay droughts which will lower your account a lot quicker.
All those people that tell you parlay are sucker bets are wrong if you can meet the following criteria.
1. Is your betting winning percentage above 52.3%?
2. Can you expect to maintain this in the future in the long run?
3. Can you survive parlay droughts?
4. Are you willing to assume higher risk for a higher payout? (The higher your winning percentage, the higher the average payout, and thus the less risk you are taking on)
5. Are you as confident in all of your picks as you would be betting on them separately (remember avoid "throw in" games, they only hurt you)?
If you can answer yes to all of those then you might want to consider switching to parlays, mathematically it would help you.
This is a really simplified way of looking at everything and assumes the past will hold true in the future but a friend thought it was interesting so I thought I'd share it. Its a good measure if you expect to win as much as you are today.
In part 2 I'll show my calculation for when parlays become advantageous over odds betting for 3,4, and 5 game parlays. I will also show at what winning percentage you start making money with straight betting and with parlays.
I still would not recommend doing parlays but at least now you get to see the payouts in a mathematical format.
Most Vegas spread odd parlays are at payouts of a -110 line (which means for every $100 you bet you have an opportunity to win approximately $91). Since spread odds are seen as 50/50, the -110 line gives the house an edge. With these same odds in mind the typical 3 game parlay card will pay out at 6/1.
For those that may be new to sports betting I'll digress a bit into what a straight odds parlay is. You place a bet on 3 teams to all win. If you lose one or push (hit the exact number on the spread) on any game you lose the full amount. However if you win all 3 the payout is significantly larger than if you were to simply bet on each team individual (in the case of this example you would be $600 for a $100 bet).
Now the question becomes: When does it become advantageous to the gambler to use a parlay rather than making 3 separate bets? The answer lies in a gambler's winning percentage in the long run (this is assuming prior betting statistics would hold for the future).
WARNING: If algebra makes your head hurt just look at the totals I came up with and assume I know what I am talking about.
Now lets assume you want to bet on 3 teams (A, B, C) and you have $100 dollars to spend. You are equally confident in them so if you bet on them separately you will equally dispense the money.
Dartboard Strategy:
First lets assume you use the dartboard strategy and pick the three games that the darts land on first. By doing so you've given yourself a 50% shot of winning each game.
.5*.5*.5= .125
This is the likelihood you will either win all of your games or lose all of your games. You will either win $91 or lose $100.
3*.125= .375
Their are three possibilities each for making 1/3 or 2/3 correct. A could win, but B and C lose. A and C could win, but B loses. And I think you get the point. If you go 1-2, you will lose roughly $37. If you go 2-1 you will win roughly $26.
(.125)(-100)+(.375)(-37)+(.375)(26)+(.125)(91)= -7.125
So on an average $100 bet you would lose $7.13 (the house advantage rears its ugly head).
Now if you chose to parlay your dartboard picks:
(.125)(600)+(.875)(-100)= -12.5
You are losing $12.50 on your average parlay.
Well gee willickers I guess I ain't too shabby at sports betting (52% WP)
Now lets say you are better than the average joe schmoe at sports betting and your winning percentage is actually at 52%. Using the same math as our prior example:
.52*.52*.52=.1406
The odds that you win all of your games
.48*.48*.48=.1106
The odds you lose all of your games
.48*.52*.52*3=.3894
The odds you win 2 and lose 1.
.48*.48*.52*3=.3594
The odds you win 1 and lose 2.
Average payout on 3 bets:
.1406(91)+(.1106)(-100)+(.3894)(26)+(.3594)(-37)= -1.4388
Still losing money at $1.44 per bet which sucks but hey, at least we have our health (maybe?). And at least our knowledge has helped close the gap.
Parlay:
(.1406)(600)+(.8594)(-100)= -1.58
Wowzers, that winning percentage really closed the gap. Now we are only losing $1.58 per parlay, however it is still advantageous to do separate betting in terms of average return.
Broesph, I am so much better at sports betting than you.
Now lets say you are quite the above average sports better. You win 54% of the games that you pick consistently. Lets go through the math again (ugh):
.54*.54*.54= .1575
Odds you win them all
.46*.46*.46= .0973
Odds you get skunked
.46*.54*.54*3= .4024
Win 2, Lose 1
.46*.46*.54*3= .3428
Win 1, Lose 2
Straight Bets:
(.1575)(91)+(.0973)(-100)+(.4024)(26)+(.3428)(-37)= 2.3813
Hey, look at you, you finally made something. You are making $2.38 per series of bets.
Parlay:
(.1575)(600)+(.8425)(-100)= 10.25
Holy raveoli, that certainly jumped up. You are now making $10.25 per parlay. It was become advantageous to you to actually bet using a parlay rather than 3 separate games
So the conclusion would be if you can consistently win at sports betting 52.2ish% of the time, 3 game parlays would actually be a good bet in the long run. Because this article is running a little long I'll create a Part II showing my calculations for that and also the winning percentages required to win a 4-and 5-game parlay (be aware the percentages climb with the more games added).
Now the task is on you to keep track of your winning percentage and use this as a general to see if parlays are advantageous.
I apologize for the algebra lesson, I'm sure we all took enough math classes in our lives but lets move onto other criteria to consider if you choose a parlay.
First of all you must be as confident in all of your picks as you have been for your past picks. If you are simply "throwing" games into a parlay than you draw your winning percentage back down towards 50% (also a note, if you are below 50% winning percentage the less advantageous parlays become. So if you are below 50% DO NOT PARLAY and I repeat DO NOT PARLAY). Finding an amount of games within a single day can be difficult to do.
Also, parlays are much more risky and you can easily lose your money a lot quicker. You need to have a good base of money to work this strategy with, you will go through parlay droughts which will lower your account a lot quicker.
All those people that tell you parlay are sucker bets are wrong if you can meet the following criteria.
1. Is your betting winning percentage above 52.3%?
2. Can you expect to maintain this in the future in the long run?
3. Can you survive parlay droughts?
4. Are you willing to assume higher risk for a higher payout? (The higher your winning percentage, the higher the average payout, and thus the less risk you are taking on)
5. Are you as confident in all of your picks as you would be betting on them separately (remember avoid "throw in" games, they only hurt you)?
If you can answer yes to all of those then you might want to consider switching to parlays, mathematically it would help you.
This is a really simplified way of looking at everything and assumes the past will hold true in the future but a friend thought it was interesting so I thought I'd share it. Its a good measure if you expect to win as much as you are today.
In part 2 I'll show my calculation for when parlays become advantageous over odds betting for 3,4, and 5 game parlays. I will also show at what winning percentage you start making money with straight betting and with parlays.
I still would not recommend doing parlays but at least now you get to see the payouts in a mathematical format.
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