WEBVTT - How a Professional Sports Bettor Really Makes Money 0:00:03.120 --> 0:00:16.360 Bloomberg Audio Studios, Podcasts, radio News. 0:00:20.200 --> 0:00:23.759 Hello and welcome to another episode of the Odd Lots podcast. 0:00:23.840 --> 0:00:26.200 I'm Joe Wisenthal and I'm Tracy Alloway. 0:00:26.520 --> 0:00:30.040 Tracy, guess what what. I'm going to Vegas tomorrow. 0:00:30.120 --> 0:00:34.199 I know you are. I'm trying to I'm trying to 0:00:34.200 --> 0:00:37.160 restrain myself. The irony is that you left me high 0:00:37.159 --> 0:00:39.360 and dry in Vegas last time. But now for the 0:00:39.400 --> 0:00:41.720 next week, I'm going to hear how much you love Vegas. 0:00:41.800 --> 0:00:43.680 Come out. It's not too late to get a ticket. 0:00:43.800 --> 0:00:44.880 I would love to come out. 0:00:44.960 --> 0:00:45.559 You're welcome. 0:00:45.880 --> 0:00:48.440 But I'm doing the opposite of Vegas. I'm going to Vermont. 0:00:48.560 --> 0:00:49.720 Oh yeah, you're going antiquing. 0:00:50.080 --> 0:00:50.479 That's right. 0:00:51.040 --> 0:00:52.520 I'm not sure if I was supposed to say that. 0:00:52.400 --> 0:00:54.319 The pinnacle of middle age. Thank you, Joe. 0:00:54.440 --> 0:00:55.600 It's the well, it's both. 0:00:55.840 --> 0:00:59.280 It's it's two expressions of middle aged news, right, like 0:00:59.320 --> 0:01:02.120 I'm going out with or friends. We're I'm gonna go 0:01:02.160 --> 0:01:04.520 see a dead end Coo show at the Sphere. 0:01:04.720 --> 0:01:06.360 That's something other than middle aged. 0:01:06.440 --> 0:01:10.360 I think like post middle age. I'm going to take 0:01:10.400 --> 0:01:12.440 a road trip to the Hoover Dam. Maybe I'll get 0:01:12.480 --> 0:01:15.319 some good infrastructure photos. And you have some good gamble. 0:01:15.840 --> 0:01:17.480 I like to play poker, and you're gonna be in 0:01:17.560 --> 0:01:20.680 Vermont antiquing. But you know what's something I find really interesting, Tracy, 0:01:20.720 --> 0:01:24.560 and Vegas is booming despite the fact that for years 0:01:24.640 --> 0:01:28.920 Vegas had this monopoly on gambling, and you would think, Okay, 0:01:28.920 --> 0:01:32.520 now gambling is everywhere, it's on your phone, many more 0:01:32.600 --> 0:01:35.920 jurisdictions have opened up casinos, and yet that doesn't really 0:01:35.959 --> 0:01:37.840 seem to have slowed it down. Well. 0:01:37.920 --> 0:01:39.959 I will say the last time I was in Vegas, 0:01:40.000 --> 0:01:42.400 which was I guess October of last year, I did 0:01:42.480 --> 0:01:47.320 notice some differences. So I was wandering around the big casinos, 0:01:47.319 --> 0:01:49.640 as one does, and I was going past you know 0:01:49.680 --> 0:01:53.080 those big sports spading areas where they have like the 0:01:53.240 --> 0:01:55.840 armchairs and all recline in them and stare at this. 0:01:55.840 --> 0:01:57.320 Big theater of like fifty. 0:01:57.360 --> 0:02:02.200 Yeah exactly, and those looked pretty empty. So I kind 0:02:02.200 --> 0:02:05.040 of wonder if, like, okay, people still like gambling at 0:02:05.080 --> 0:02:08.720 table games or whatever, but maybe you're getting less interest 0:02:08.960 --> 0:02:11.400 in the sports aspect of it, because why go all 0:02:11.440 --> 0:02:13.880 the way to Vegas to watch a basketball game and 0:02:13.919 --> 0:02:16.079 bet on it if you can do it from your 0:02:16.080 --> 0:02:16.919 couch at home. 0:02:17.160 --> 0:02:19.400 No, that is a good question. It would be interesting. 0:02:19.400 --> 0:02:20.960 I mean, I feel like the last time I was 0:02:20.960 --> 0:02:23.519 in Vegas, I don't remember exactly when, Like I think 0:02:23.520 --> 0:02:25.840 there was like a big game going on, so like 0:02:25.960 --> 0:02:29.359 that environment of the casino can get like super raucous 0:02:29.360 --> 0:02:33.000 and exciting, but it still does raise questions. 0:02:33.040 --> 0:02:35.800 I mean about the rise of being able to. 0:02:35.800 --> 0:02:38.600 Bet literally on your phone everywhere and basically every state 0:02:38.639 --> 0:02:40.000 I think, or close to it. 0:02:40.120 --> 0:02:43.240 I have a random collection of thoughts on this topic, 0:02:43.320 --> 0:02:46.000 which is kind of ironic because I know absolutely nothing 0:02:46.360 --> 0:02:48.680 about sports better and now you're going to rattle off 0:02:48.720 --> 0:02:50.320 a p now I'm gonna rat it. Here. Here are 0:02:50.360 --> 0:02:53.160 all my thoughts on it. Well, one, I remember when 0:02:53.160 --> 0:02:55.520 I used to come to the US from other places, 0:02:55.600 --> 0:02:58.120 a big culture shock was when you would watch TV 0:02:58.240 --> 0:03:00.920 and there would be all those ads from metas and 0:03:00.919 --> 0:03:02.760 it would be like talk to your doctor and request 0:03:02.800 --> 0:03:05.480 the specific medicine, which doesn't happen as far as I know, 0:03:05.560 --> 0:03:08.359 in any other country in the world. Now, I think 0:03:08.360 --> 0:03:11.640 the big culture shock is all the gambling ads. Like 0:03:11.800 --> 0:03:13.840 you watch TV and there are all these ads going, oh, 0:03:13.960 --> 0:03:16.360 you know, we'll pay you an initial lump sum to 0:03:16.400 --> 0:03:18.680 get on our platform. And make a few bets and 0:03:18.720 --> 0:03:20.560 you're gonna win all this money and it's gonna be 0:03:20.560 --> 0:03:22.760 loads of fun. Blah blah blah blah blah. And then 0:03:22.919 --> 0:03:26.720 the other thing I was thinking is I feel like 0:03:26.840 --> 0:03:29.919 a lot of the gambling operators, and this isn't exclusive 0:03:30.080 --> 0:03:33.320 to the sports betters, but maybe to the casinos in 0:03:33.400 --> 0:03:35.840 Vegas as well, I think like, I feel like they're 0:03:35.880 --> 0:03:38.920 getting smarter with a lot of the way they're operating. 0:03:39.000 --> 0:03:41.760 So again, the last time I was in Vegas, I noticed, 0:03:42.000 --> 0:03:45.680 for instance, this isn't necessarily new, but it was kind 0:03:45.680 --> 0:03:49.840 of more extreme. The minimum bets on tables change a 0:03:49.880 --> 0:03:52.920 lot between the weekend and the weekdays, but I feel 0:03:52.920 --> 0:03:55.200 like they change even more than they used to, Like, 0:03:55.240 --> 0:03:57.400 I feel like the pricing is more dynamic. And Joe, 0:03:57.400 --> 0:03:59.200 I know you make fun of me, but it ruined. 0:03:59.320 --> 0:04:00.600 It ruined my cap system. 0:04:01.040 --> 0:04:05.280 Tracy claims to have had a crap system and my 0:04:05.360 --> 0:04:06.560 response says, no, she didn't. 0:04:06.640 --> 0:04:08.440 And if you think you, I never said it was. 0:04:08.440 --> 0:04:11.840 A good system. I just said it was a system. Okay, okay, 0:04:12.120 --> 0:04:14.080 it was a way of betting. And I couldn't do 0:04:14.120 --> 0:04:15.240 it last time because. 0:04:15.040 --> 0:04:18.080 You know, it's getting more sophisticated about pricing strategies. But 0:04:18.080 --> 0:04:20.880 you're right, like sports media, as everyone knows these days, 0:04:20.960 --> 0:04:25.039 is just completely suffused with gambling and it sort of 0:04:25.120 --> 0:04:28.599 funds the whole thing. And gambling has become not just 0:04:28.640 --> 0:04:31.000 more prevalent and more exotic. And of course you can 0:04:31.040 --> 0:04:32.760 bet on the games, and you can always bet on 0:04:33.080 --> 0:04:35.080 the spread, but now you can bet on like who's 0:04:35.080 --> 0:04:37.000 going to be winning at the end of each quarter, 0:04:37.080 --> 0:04:39.080 or you could be betting on how many home runs 0:04:39.160 --> 0:04:41.039 a certain player will hit, or how many three pointers 0:04:41.080 --> 0:04:43.479 a certain hit like, and you know, it's basically just 0:04:43.600 --> 0:04:45.680 like what we've seen in the stock market. Used to 0:04:45.720 --> 0:04:47.719 just be able to buy stocks and now everyone's doing 0:04:47.839 --> 0:04:50.960 like zero day options and stuff and endless sort of 0:04:51.000 --> 0:04:54.440 like exotic number of bets have just become, you know, 0:04:54.960 --> 0:04:57.560 become part of how people talk about sports. 0:04:57.760 --> 0:04:59.800 Yeah, that was the other thing I was going to say. 0:04:59.839 --> 0:05:02.280 So a weird thing now is watching sports some of 0:05:02.320 --> 0:05:05.880 the commentators will like call out these specific plays and 0:05:05.920 --> 0:05:08.599 like mention the odds and the payouts and things, which 0:05:08.640 --> 0:05:10.839 is completely different to the way sports used to be. 0:05:10.960 --> 0:05:11.919 Totally I forget what it was. 0:05:11.960 --> 0:05:14.000 There was some screenshots someone took recently of like a 0:05:14.040 --> 0:05:15.839 baseball game, and you know, it used to be like 0:05:15.880 --> 0:05:17.560 you look at a batter and it was like the 0:05:17.560 --> 0:05:20.520 stats they would show would be like batting average, home 0:05:20.600 --> 0:05:22.560 runs and RBIs and that was kind of it, and 0:05:22.560 --> 0:05:25.040 maybe steals or something like that. And now like there's 0:05:25.080 --> 0:05:27.679 all these other stats that are not really even probably 0:05:27.720 --> 0:05:31.479 that interested interesting to normal fans unless you have a 0:05:31.560 --> 0:05:34.640 bet placed. And so there's been this proliferation. Of course, 0:05:34.680 --> 0:05:38.279 this a lot of like anxiety, tons of articles about 0:05:38.279 --> 0:05:40.640 young men getting addicted to gambling and what does it 0:05:40.680 --> 0:05:43.080 say about this generation and all kinds of stuff, and 0:05:43.160 --> 0:05:45.760 so there's a lot going on in sports better. 0:05:45.880 --> 0:05:47.640 Yeah, we need to dig into it. As I said, 0:05:47.720 --> 0:05:50.200 I know nothing about this particular area. I don't think 0:05:50.200 --> 0:05:53.040 I've ever placed a sports bet in my life. What 0:05:53.680 --> 0:05:57.559 horse racing? Yeah, but does that even I don't know if. Okay, 0:05:57.760 --> 0:06:00.760 but this is something that I feel like it's growing 0:06:01.000 --> 0:06:01.360 a lot. 0:06:01.480 --> 0:06:01.560 Ye. 0:06:01.720 --> 0:06:04.400 Clearly there's a lot of money involved here. So I'm 0:06:04.480 --> 0:06:05.880 very excited about digging into it. 0:06:06.080 --> 0:06:08.640 I'm very excited. Well, I pleased to say. We really 0:06:08.680 --> 0:06:11.279 do have the perfect guest today. We're going to be 0:06:11.279 --> 0:06:15.600 speaking with Isaac rose Berman. He is himself a professional 0:06:15.680 --> 0:06:20.160 sports better. He also writes about the industry on a website, 0:06:20.160 --> 0:06:22.800 how Gambling Works dot com. He also talks about the 0:06:22.839 --> 0:06:27.000 regulatory side and some of the tactics that businesses us to, 0:06:27.160 --> 0:06:29.400 as you say, hook people in for the first time 0:06:29.480 --> 0:06:31.920 and keep them betting, and I guess, from the perspective 0:06:31.960 --> 0:06:34.960 of the businesses, keep them losing money. So, Isaac, thank 0:06:35.000 --> 0:06:36.560 you so much for coming out nod Laws. 0:06:36.600 --> 0:06:37.960 Thank you so much for having me a big fan 0:06:38.000 --> 0:06:38.960 of the show. Happy to be here. 0:06:39.000 --> 0:06:39.680 Thank you so much. 0:06:40.240 --> 0:06:44.080 I introduced you as a professional sports better. Is that 0:06:44.160 --> 0:06:46.400 really true? You can be a professional sports better. I mean, 0:06:46.440 --> 0:06:48.880 I'm aware of it, but what actually do you do? 0:06:49.560 --> 0:06:52.440 That's a great question. So, unlike other casino games, it 0:06:52.520 --> 0:06:55.120 is possible to win on sports betting because the odds 0:06:55.160 --> 0:06:57.800 are dynamic and they're constantly changing. So when you know 0:06:57.839 --> 0:07:00.080 Tracy's going to play craps whenever she sits down at 0:07:00.120 --> 0:07:02.760 the table, that the odds are always stacked against her 0:07:02.760 --> 0:07:05.640 and they're never changing, she cactus in, Yeah, but when 0:07:05.640 --> 0:07:07.839 it comes to sports betting, things are constantly changing. So 0:07:07.880 --> 0:07:10.000 to give you a super simple example, you know, let's 0:07:10.000 --> 0:07:13.600 say the Lakers are playing and Lebron James gets announced injured. 0:07:13.640 --> 0:07:15.560 If you rush to your sports book and you place 0:07:15.560 --> 0:07:18.320 a bet on the opposing team before they've factored in 0:07:18.360 --> 0:07:20.360 the information that Lebron is injured, you're going to lock 0:07:20.440 --> 0:07:22.840 in a really good price before the odds update. And 0:07:22.920 --> 0:07:25.000 so when it comes to being a professional sports better, 0:07:25.000 --> 0:07:28.640 it's all about identifying value. And by value we mean 0:07:28.720 --> 0:07:32.040 bets which have a greater expected return than the amount staked. 0:07:32.120 --> 0:07:35.000 So if someone offers you, you know, bet ten dollars 0:07:35.040 --> 0:07:36.760 to win eleven dollars on a coin flip, and it's 0:07:36.800 --> 0:07:39.200 a fair coin flip, even if you place that and 0:07:39.240 --> 0:07:40.960 you guess the wrong side ten times in a row 0:07:41.000 --> 0:07:42.880 and you keep losing. In the long run, if you 0:07:42.960 --> 0:07:44.560 keep doing that, you're going to make money. And that's 0:07:44.560 --> 0:07:47.440 how professional sports betters make money, by constantly placing bets 0:07:47.600 --> 0:07:49.000 which have a positive expected return. 0:07:49.480 --> 0:07:52.480 So, just so we can better understand this dynamic, walk 0:07:52.560 --> 0:07:54.880 us through your sort of day to day as a 0:07:54.920 --> 0:07:59.080 professional sports gambler. What kind of opportunities are you trying 0:07:59.080 --> 0:08:02.440 to identify? And then how do you decide how much money, 0:08:02.480 --> 0:08:06.080 for instance, to apply to each individual bet. 0:08:06.200 --> 0:08:08.360 Yeah, that's a great question. So it really depends on 0:08:08.480 --> 0:08:10.680 you know, what sports are in season. So right now 0:08:10.720 --> 0:08:12.840 you know end of the NBA, but there's a lot 0:08:12.880 --> 0:08:15.400 of MLB things like tennis or year round, and so 0:08:15.440 --> 0:08:17.800 it does depend on the sports they're in general. Two 0:08:17.880 --> 0:08:21.440 ways of identifying profitable sports bets. The first is you 0:08:21.480 --> 0:08:23.320 can take sort of a market based approach. And by 0:08:23.320 --> 0:08:25.440 a market based approach, what we mean is there are 0:08:25.480 --> 0:08:28.080 tons of sportsbooks out there, and as Joe mentioned, they're 0:08:28.120 --> 0:08:30.040 all offering all of these different kind of bets, and 0:08:30.080 --> 0:08:32.200 you if you constantly scroll through all of the odds, 0:08:32.280 --> 0:08:35.120 you're going to find slight miss pricings. So let's say 0:08:35.240 --> 0:08:37.560 you know everybody has you know that Yankees is two 0:08:37.600 --> 0:08:39.600 to one underdogs, and one sportsbook has them as a 0:08:39.600 --> 0:08:41.760 three to one underdog. You know, you can identify that 0:08:41.800 --> 0:08:44.200 as off market and you can place that bet. So 0:08:44.200 --> 0:08:45.240 so one part is, I. 0:08:45.400 --> 0:08:48.679 See, so you're you're not saying that like the platforms 0:08:48.679 --> 0:08:51.359 have the odds wrong, You're trying to identify like outliers 0:08:51.400 --> 0:08:52.320 among the platforms. 0:08:52.320 --> 0:08:55.080 That's exactly right. Yeah, So that's that's probably the main 0:08:55.160 --> 0:08:58.920 way that the majority of professional or winning sports betters 0:08:58.960 --> 0:09:01.960 make moneies by identa defying markets. Which are simply mispriced. 0:09:01.960 --> 0:09:04.080 And for that you don't need any special sports knowledge. 0:09:04.080 --> 0:09:05.840 You just need to have a screen with all the 0:09:05.840 --> 0:09:08.079 odds and constantly be scrolling through them and looking for 0:09:08.440 --> 0:09:10.440 price changes and looking for, you know, books that are 0:09:10.440 --> 0:09:12.400 slow to update. The other way to do it, which 0:09:12.440 --> 0:09:14.200 is a lot harder and a lot rare, is to 0:09:14.240 --> 0:09:17.160 basically create your own numbers. So you say, Okay, you know, 0:09:17.280 --> 0:09:19.800 I know exactly how much each player is worth. I 0:09:19.840 --> 0:09:21.800 know what the weather is going to be today, I 0:09:21.880 --> 0:09:23.959 know these matchups, and so I'm going to generate kind 0:09:23.960 --> 0:09:26.640 of from scratch, from my own model the odds and 0:09:26.679 --> 0:09:28.400 then apply that to the market. And when it comes 0:09:28.480 --> 0:09:31.600 to major liquid markets like the NFL or the NBA 0:09:31.720 --> 0:09:34.000 or the MLB, that's really really hard to do, and 0:09:34.080 --> 0:09:35.800 there are very very few people who can do that, 0:09:35.840 --> 0:09:37.920 but those are the people who make the most money. 0:09:37.800 --> 0:09:39.440 To zoom out even further. 0:09:39.880 --> 0:09:43.120 So it's like there's some big gang crosstown rivalry Yankees 0:09:43.200 --> 0:09:45.400 versus Mets, there's some odds or something. Where does that 0:09:45.559 --> 0:09:48.160 price initially come from? Well, guess through how that line 0:09:48.160 --> 0:09:48.840 gets established. 0:09:48.840 --> 0:09:50.640 It's a great question. So when you log onto your 0:09:50.720 --> 0:09:52.800 DraftKings or FanDuel account, you're going to see all of 0:09:52.800 --> 0:09:54.320 these different bets, and you're going to see all these 0:09:54.320 --> 0:09:57.760 different prices, and those prices come from one or two places. 0:09:58.160 --> 0:09:59.600 The first type of bet you're going to see is 0:09:59.600 --> 0:10:02.760 the major market odds, like you mentioned. You know who's 0:10:02.800 --> 0:10:04.840 going to win, how much they're going to win by 0:10:04.840 --> 0:10:07.040 the total, and what those those odds come from a 0:10:07.080 --> 0:10:09.920 price discovery process. And what that means is that a 0:10:10.040 --> 0:10:13.320 market maker sports book, not Draft Kings or FanDuel, but 0:10:13.360 --> 0:10:17.600 places like Pinnacle, places like bet Chris. What they do is, well, 0:10:17.640 --> 0:10:19.840 before the game starts, they basically throw out a price 0:10:19.880 --> 0:10:21.800 and they don't really know if that price is good. 0:10:22.040 --> 0:10:23.760 And what they say is, you know, anybody can come 0:10:23.800 --> 0:10:25.720 bet here. You can only bet a very small amount, 0:10:25.720 --> 0:10:28.320 maybe fifty dollars, maybe one hundred dollars, and they keep 0:10:28.360 --> 0:10:30.559 taking bets on both sides. And what happens is all 0:10:30.559 --> 0:10:32.439 of the smart people they go there and they say, 0:10:32.480 --> 0:10:33.800 you know, we're going to bet on this side because 0:10:33.800 --> 0:10:36.040 it's good, and they keep adjusting their price based on 0:10:36.080 --> 0:10:39.439 the action. And then eventually, when sort of that betting 0:10:39.520 --> 0:10:43.559 flurry has has settled, then DraftKings comes in and says Okay, 0:10:43.600 --> 0:10:46.000 you know, now we know that this price is roughly accurate, 0:10:46.200 --> 0:10:48.120 we're going to take it. And then when it comes 0:10:48.120 --> 0:10:50.400 to all of the derivative bets like you mentioned before, 0:10:50.440 --> 0:10:52.559 stuff like how many home runs someone is going to hit, 0:10:52.800 --> 0:10:54.760 you know, whether or not this player is going to 0:10:54.760 --> 0:10:58.240 get seven threes. All that stuff is generated by third 0:10:58.280 --> 0:11:02.040 party content providers who take the input of the odds 0:11:02.040 --> 0:11:04.959 from those liquid markets and generate the odds for all 0:11:04.960 --> 0:11:06.880 these other things. So when you look at a sportsbook, 0:11:07.120 --> 0:11:09.600 you know either the odds are coming from a market 0:11:09.640 --> 0:11:12.120 maker or they're coming from a model based on that 0:11:12.120 --> 0:11:13.000 market maker price. 0:11:13.320 --> 0:11:15.320 Wait, can you talk a little bit more about those 0:11:15.360 --> 0:11:18.679 sort of like single plays or exotic bets or whatever 0:11:18.720 --> 0:11:21.079 you call them, because to me, it seems almost if 0:11:21.080 --> 0:11:23.439 you're watching a baseball game, to me, it seems almost 0:11:23.520 --> 0:11:25.400 random whether or not there's going to be a home 0:11:25.480 --> 0:11:28.600 run or two home runs or whatever. And I take 0:11:28.640 --> 0:11:31.840 the point that they're deriving those odds from maybe the 0:11:31.880 --> 0:11:36.880 more liquid markets, like which team is better overall or whatever, 0:11:37.320 --> 0:11:39.959 but it still seems kind of hard to price. 0:11:40.080 --> 0:11:42.679 No, it's really really hard, and that's why there's you know, 0:11:42.800 --> 0:11:45.280 in general, there are lots of different content providers. So 0:11:45.480 --> 0:11:48.120 the person who's deriving the prices for how many home 0:11:48.200 --> 0:11:49.520 runs there are in a game is not going to 0:11:49.600 --> 0:11:51.839 be the same person who's deriving, you know, how many 0:11:51.840 --> 0:11:54.079 three pointers there are in a game. So a sportsbook 0:11:54.160 --> 0:11:55.880 is going to work with a bunch of different content 0:11:55.920 --> 0:11:58.319 providers to get the odds for all these different markets 0:11:58.480 --> 0:12:00.760 and their jobs. That's all they're trying to do. And 0:12:00.840 --> 0:12:04.720 in general, the sports book knows that these lines aren't perfect, 0:12:04.760 --> 0:12:07.080 which is why. You know, if you want to walk 0:12:07.120 --> 0:12:09.000 into a sport, into a casino or go to a 0:12:09.000 --> 0:12:11.160 sportsbook and bet a million dollars on the Yankees, they're 0:12:11.160 --> 0:12:13.080 going to say, you know, oh sure, come on in. 0:12:13.240 --> 0:12:15.360 You know, he'll give you a free hotel room, we'll 0:12:15.360 --> 0:12:17.880 give you anything. But if you walk in you say 0:12:17.920 --> 0:12:20.240 I want to bet, you know, a million dollars on 0:12:20.320 --> 0:12:22.920 this player to get under one point five three pointers, 0:12:22.960 --> 0:12:24.679 obviously they're not going to accept that bet because they 0:12:24.679 --> 0:12:27.280 know there's inside information. And so that's why in general, 0:12:27.280 --> 0:12:29.800 in these markets there are both lower limits and there's 0:12:29.880 --> 0:12:33.000 higher scrutiny on the sportsbook side, and they also add 0:12:33.040 --> 0:12:35.360 a higher house edge, so you have to win by 0:12:35.360 --> 0:12:38.199 a much higher margin compared to betting on just who's 0:12:38.200 --> 0:12:39.520 going to win or how much they're going to win by. 0:12:39.600 --> 0:12:41.320 That was exactly what I was going to ask. So 0:12:41.400 --> 0:12:44.680 presumably they sort of like pad their own edge in 0:12:44.800 --> 0:12:46.239 order to offset the uncertainty. 0:12:46.360 --> 0:12:48.600 That's exactly the right. So if you're if you're throwing 0:12:48.679 --> 0:12:50.880 darts at a sportsbook and you know you're picking winners 0:12:50.880 --> 0:12:53.400 and losers randomly, you're going to lose four to five percent. 0:12:53.640 --> 0:12:56.120 But if you're throwing darts at you know, this player 0:12:56.160 --> 0:12:57.800 to get X number of home runs, you're going to 0:12:57.880 --> 0:13:00.760 lose ten percent, twenty percent. When we talk about things 0:13:00.760 --> 0:13:03.760 like same game parlays, these bets where you're combining this 0:13:03.800 --> 0:13:05.760 team to win, this guy to get a home run 0:13:05.760 --> 0:13:07.760 in this picture, to get a lot of strikeouts, unless 0:13:07.800 --> 0:13:10.600 you're doing it in a way that really beats the market, 0:13:10.600 --> 0:13:13.040 you're going to be losing thirty to forty percent, really 0:13:13.040 --> 0:13:15.319 really high margins in a way that's really that's very 0:13:15.360 --> 0:13:17.360 new and not seen until quite recently. 0:13:17.880 --> 0:13:19.800 And of course those are the bets that they really 0:13:19.800 --> 0:13:21.960 are like pushing more, and that's why we're flooded with 0:13:22.000 --> 0:13:24.760 all these exotic statistics to encourage this kind of action. 0:13:25.160 --> 0:13:29.920 I have to imagine that with these exotic bets, whether 0:13:30.000 --> 0:13:32.880 it's like, again, how many home runs someone's going to 0:13:32.920 --> 0:13:35.240 win in or you mentioned tennis, how many sets it'll 0:13:35.240 --> 0:13:39.120 take for one player to beat another, that while the 0:13:39.160 --> 0:13:42.560 house does have a structurally higher edge for reasons that 0:13:42.600 --> 0:13:45.840 you've described, I assume these are the markets also which 0:13:45.920 --> 0:13:49.400 because they're less efficiently prized, because the fans just don't 0:13:49.440 --> 0:13:53.320 set the line that one can find actual I don't know, 0:13:53.360 --> 0:13:56.320 maybe alpha is the word, but true mispriced bets. 0:13:56.440 --> 0:13:57.160 Is that correct? 0:13:57.160 --> 0:13:59.600 That's exactly right. So I think, you know, people think 0:13:59.679 --> 0:14:02.600 that the hard part is finding profitable bets or even 0:14:02.640 --> 0:14:05.280 you know, pure arbitrages, but it's really not the case, 0:14:05.400 --> 0:14:07.400 especially when you look at the total number of bets 0:14:07.400 --> 0:14:10.240 these companies are putting out. It's just impossible to price 0:14:10.400 --> 0:14:14.000 everything perfectly all of the time. The issue is, you know, 0:14:14.040 --> 0:14:15.800 once again, if you go into a sports book and 0:14:15.840 --> 0:14:18.160 you say, I want to bet a million dollars on 0:14:18.240 --> 0:14:20.960 this one person to get X number of strikeouts, they're gonna, 0:14:21.000 --> 0:14:23.280 you know, raise their eyebrows at you. And if there's 0:14:23.280 --> 0:14:25.480 a systemic error, they might fix it, or if you're 0:14:25.600 --> 0:14:27.800 you keep winning, they're gonna shut you down. And so 0:14:28.000 --> 0:14:31.000 the problem from a professional standpoint is not just identifying 0:14:31.000 --> 0:14:34.080 those mispricings, but actually being able to bet enough money 0:14:34.120 --> 0:14:35.680 and not get kicked out to make it work. 0:14:35.720 --> 0:14:51.720 Well out, Tracy. 0:14:51.800 --> 0:14:55.040 I had a friend years ago who is a semi 0:14:55.040 --> 0:14:58.760 professional blackjack player. Most of the work that he did 0:14:59.040 --> 0:15:02.440 was not really and the strategy, but just like, how 0:15:02.480 --> 0:15:05.320 can he maximize his time at the table without the 0:15:05.360 --> 0:15:06.880 odds of getting kicked out of the casino? 0:15:07.040 --> 0:15:09.960 I never okay, hot take, I never understood why counting 0:15:10.000 --> 0:15:13.600 cards is like not allowed at casinos. Isn't that just 0:15:13.600 --> 0:15:17.280 playing the game? Well, I don't get it. 0:15:17.680 --> 0:15:19.480 I agree with that, but the answer is that the 0:15:19.480 --> 0:15:20.760 casinos make the rules and they. 0:15:20.640 --> 0:15:24.000 Don't want to lose money. Yeah, okay, well seems like nonsense. 0:15:24.160 --> 0:15:27.800 Yeah, so you mentioned this idea that and Joe kind 0:15:27.840 --> 0:15:29.640 of riffed on it. Just then, this idea that a 0:15:29.680 --> 0:15:33.160 lot of the expertise of being a professional better is 0:15:33.280 --> 0:15:35.680 just figuring out how you can stay at the table 0:15:35.720 --> 0:15:37.640 for as long as possible or stay on the app 0:15:37.720 --> 0:15:40.880 for as long as possible. How do the platforms I 0:15:40.920 --> 0:15:42.840 know how the casinos do it, but how do the 0:15:42.840 --> 0:15:46.840 platforms like identify you and then say, actually, we don't 0:15:46.880 --> 0:15:50.120 want you to bet anymore or in this particular size. 0:15:50.160 --> 0:15:51.680 It's a great question. So we kind of call it 0:15:51.720 --> 0:15:53.800 the science versus the art of sports betting. So the 0:15:53.840 --> 0:15:56.080 science of sports betting is figuring out what bets you 0:15:56.080 --> 0:15:58.080 want to place. The art of sports betting is figuring 0:15:58.080 --> 0:15:59.400 out how to place your bets in a way that 0:15:59.400 --> 0:16:02.560 you don't actually kicked out. And so the problem is 0:16:02.600 --> 0:16:05.600 that the way that sports books identify who's good is 0:16:05.640 --> 0:16:08.840 the same way that professional betters place good bets, and 0:16:08.920 --> 0:16:12.640 it's through something called CLV or closing line value. And 0:16:12.720 --> 0:16:15.360 the idea there is that markets, in general, they get 0:16:15.360 --> 0:16:18.240 more efficient, and so by the time a game has started, 0:16:18.280 --> 0:16:20.360 the market is considered to be very efficient. And so 0:16:20.400 --> 0:16:22.120 what I mean by that is, let's say you place 0:16:22.120 --> 0:16:25.000 a bet on the Celtics, and when you place a bet, 0:16:25.040 --> 0:16:27.280 they're big underdog, so you risk one dollar to win 0:16:27.360 --> 0:16:29.760 five dollars. By the time the game starts, it's now 0:16:29.800 --> 0:16:31.600 fifty to fifty, so it's one dollar to win one 0:16:31.680 --> 0:16:34.640 dollar no matter what happens in that game. Even if 0:16:34.640 --> 0:16:37.760 the Celtics lose, you placed a good bet. The odds 0:16:37.800 --> 0:16:40.560 moved in your favor, and so from a professional standpoint, 0:16:40.640 --> 0:16:42.280 that's how you know you placed a good bet. But 0:16:42.360 --> 0:16:44.920 of course from the sportsbook side, they can also track 0:16:44.960 --> 0:16:47.080 that on there end and say, Okay, this guy is 0:16:47.160 --> 0:16:50.200 constantly getting the better of us. It doesn't matter if 0:16:50.200 --> 0:16:52.480 he lost this specific bet, we're still going to kick 0:16:52.520 --> 0:16:53.800 him out. And that's why, you know, I know many 0:16:53.840 --> 0:16:55.880 people who have lost many thousands of dollars in sports 0:16:55.880 --> 0:16:58.120 betting apps and they've still been limited or kicked out 0:16:58.120 --> 0:17:01.040 of sports books because it's not that hard to tell 0:17:01.200 --> 0:17:03.440 when someone is placing really good bets. It's pretty difficult 0:17:03.440 --> 0:17:05.000 to be able to disguise the bets that you're placing. 0:17:05.160 --> 0:17:07.359 Wait, and then what is the actual message? They just 0:17:07.359 --> 0:17:08.560 say like you've been cut off. 0:17:08.800 --> 0:17:11.680 So it really varies in general. When it comes to legal, 0:17:11.720 --> 0:17:13.920 regulated sports books, they don't kick you out, but they'll 0:17:13.960 --> 0:17:15.639 just limit the bet. They'll limit the bets that you 0:17:15.680 --> 0:17:17.879 can place to a very very small amount. So you know, 0:17:17.920 --> 0:17:20.320 if you might open up an account and at first 0:17:20.400 --> 0:17:22.440 you can bet let's say a thousand dollars in this game, 0:17:22.640 --> 0:17:24.479 once you place a few bets and they identified as 0:17:24.520 --> 0:17:26.720 you you as good, maybe you can only bet fifty 0:17:26.760 --> 0:17:28.560 dollars or sometimes you know, even as little as a 0:17:28.600 --> 0:17:31.800 couple of dollars, or I've seen people limited to literal cents. 0:17:32.000 --> 0:17:33.920 And that's because in general, the laws and a lot 0:17:33.920 --> 0:17:35.800