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For centuries, humankind has been fascinated with the idea of wagering on the outcome of games and displays of physical prowess. Any notion that the modern world of sports gambling is where it all started is simply wrong. If you don’t think the Romans were wagering on the outcome of what was taking place in the great Coliseum, you simply don’t know much about the history of sports betting.
Of course, sports betting has evolved over the centuries. As recent as 85 years ago, major gambling conglomerates like William Hill have been accepting wagers on major sports leagues and events. Today, sports betting is quickly becoming one of the fastest-growing adult entertainment industries in the world.
Brief History of Sports Betting America
In America, legal sports betting started and was confined to the state of Nevada for well over 50 years. If someone wanted to wager legally on NFL or NCAA college basketball games, they had to make their way to Las Vegas, Reno, or Lake Tahoe.
Of course, Americans have always had a fondness for betting on sports. It’s what kept local bookies and offshore sportsbooks in business for so many years. While U.S. sports gamblers were and are seldom prosecuted for illegally betting on sports through offshore online bookmakers, the U.S. Department of Justice and Congress did what they could to discourage U.S. citizens from placing such bets.
The most prominent effort the government took to stop the flow of gambling dollars to offshore bookmakers and casinos came with the passing of The Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA). What this law attempted to do was illegalize the use of credit cards and wire transfers to fund offshore gambling accounts. Unfortunately for the government, enforcement was difficult and U.S. gamblers would not be deterred.
After watching potential online sports betting tax dollars go to other countries, states like New Jersey began making noise about doing away with the federal ban on sports betting America. That noise was finally heard by the U.S. Supreme Court, and they reacted by using the STATES RIGHT clause of the U.S. Constitution to overturn the ban and let state legislatures/citizens decide the sports betting issue for themselves.
Today, half the states in the U.S. have already passed sports betting legislation with residents in approximately 20 of those states already able to place legal sports bets.
Sports Betting Explained – The Basics
Sports betting is a process by which an individual places a wager with something of value, usually money, on the outcome of a game, match, or sports event. Legalized sports betting in America requires that the bettor place their wagers with bookmakers that are licensed to take sports wagers.
Since sports betting is a state issue, bookmakers can only accept wagers from bettors who are in the same states as the bookmakers themselves. For instance, a sports bettor in New Jersey is only allowed to place sports bets with bookmakers that are licensed by the state of New Jersey. Furthermore, the sports bettor must be physically located in the state of New Jersey when they place their wagers. To ensure the location clauses are enforced, each state uses geo-tracking software to identify the URL addresses of its customers.
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Types of Sports Betting Operators or Bookmakers
In the U.S., bookmakers are identified as either retail bookmakers, online bookmakers, or both.
A retail bookmaker occupies a physical sportsbook from which they can transact business with sports bettors. Retail sports books are typically located in:
- Land based casinos
- Retail outlets or kiosks
- Bars and restaurant
- In or around sports facilities or stadiums
The laws in each state will dictate from where retail bookmakers can operate.
As the name infers, online bookmakers provide websites on which registered gamblers can place sports bets. Online bookmakers are required to maintain an operating license in much the same way as retail bookmakers. Again, residents in a particular state must place their online sports bets through an online bookmaker that is located in their state, and they must be in the state when accessing the website.
Based on provisions in the laws, retail bookmakers often will also operate online sports betting websites, a term the industry refers to as operating a “skin.” In some states, a retail bookmaker might be allowed to operate as many as three skins at any time as long as they pay the licensing fees.
How Online Bookmakers Compete
In states where online sports betting is not yet legal, bettors have to visit retail sports betting locations. For retail bookmakers, there is very little need to compete because customers will usually select their retail betting site based on location, the best location being nearest to home. The same is not true for online bookmakers.
With sports bettors able to easily access every online bookmaker in their respective states, online bookmakers are forced to compete for new customers and to keep the existing ones. Since all bookmakers offer pretty much the same betting products and banking options, the only means by which they can compete with one another is by offering bonuses and betting promotions.
While most online bookmakers will put forth a series of intermittent betting promotions to prompt more betting, the bonus that has the most appeal to online sports bettors is the welcome bonus.
Pretty much all online bookmakers will post a welcome bonus offer. Welcome offers can come in the form of matching deposits, free bets, or rebates based on the sports bettor’s first real cash wager if it loses. While these are the most common welcome bonuses, they might vary in amount or have added features if a particular bookmaker believes it might draw more new customers.
To be clear, the competition for new customers can be fierce. Also, a lot of bookmakers will invest time and money to make sure their existing customers also get extra betting value in the form of the aforementioned betting promotions. Most betting promotions target specific games, specific outcomes, or profit boosts on winnings.
It’s worth noting that the online bookmakers in the U.S. and other parts of the world aren’t in the business of giving money away. When they offer a bonus of any kind, they usually tie some type or types of wagering requirements to the bonus amount. A wagering requirement is a condition that the bettor has to meet to convert the bonus amount into real cash. That matters because sports bettors are only permitted to withdraw funds that belong to them.
The most relevant wagering requirement is what the industry calls the PLAYTHROUGH or ROLLOVER requirement. The rollover requirement is the number of times the bettor must wager the bonus amount before the remaining balance becomes theirs to keep.
Example: Bettor A gets a matching bonus of $100 with a rollover requirement of 10x the bonus amount. That means the bettor cannot withdraw any money associated with the bonus until they have placed $1,000 ($100 x 10) in sports wagers.
While other terms and conditions might exist, the rollover requirement is the one that gets the most focus.
The Betting Process
When addressing sports betting explained, the actual betting process is of the utmost importance.
To bet on sports in America, bettors have to meet certain requirements. First and foremost, they must be of legal age. Across the legal states in America, the legal age for sports betting is 21 years old. In the states that have not yet passed sports betting legislation, the betting age is yet to be determined.
Another requirement American sports bettors must meet is the location requirement. As was mentioned above, bettors are only permitted to bet through online bookmakers that are licensed in the state in which the bettor is located when they are placing their wagers.
Before placing bets, sports bettors have to locate a retail sports betting site or register with an online bookmaker in their state. The next step in the process is coming up with the funds with which they can wager. If wagering online, the bettor will have to fund their account before placing bets. Funding options for American sports bettors will usually include retail site cash deposits, credit cards (VISA, MasterCard, Discover), Skrill, paynearme, and bank to bank transfers.
With money in hand, the only things a bettor has left to do is handicap their games, place their bets, and watch their games for final results. If fortunate enough, the last step in the process is collecting winnings.
Understanding Money Line Odds and Point Spreads
Two teams or players are rarely absolutely equal in talent and success. In almost every case, a game or match will have a favorite to win and an underdog.
Bookmakers would go broke if they allowed bettors to make bets on games or matches straight up at even money (+100). The big money would roll in on the favorite, and the bookmaker would lose big. To prevent this from happening, bookmakers can use money line odds or point spreads to equal things out a bit.
Money Line Odds: Money line odds are stated in multiples of $100. However, smaller wagers can be made. If the money line odds have a minus sign (-) in front of it, it indicates that the team or player is the favorite. Conversely, the odds for an underdog would be stated with a plus sign (+) in front.
Example: Boxer A is favored to beat Boxer B. The odds on Boxer A might be -200, which means the odds on Boxer B would be +180.
The minus number indicates the amount a bettor must wager if they want to win $100. The plus number indicates the amount a bettor will win if they wager $100. From the above example, a bettor would have to wager $200 on Boxer A to win a net return of $100 if Boxer A wins the bout. Conversely, a Bettor would win a net return of $180 if they wagered $100 on Boxer B and Boxer B won the bout. If the bout ended in a draw, all bettors would get refunds. If by chance a bettor wagered on the bout to end in a draw, they would win their bet at the stated odds.
If a game or match were equal in every way, bookmakers would set the money line odds for both sides at -110. That means each bettor would have to bet $110 to win a net of $100. The extra amount is the bookmaker’s commission for taking the bet. They also call this the vigorish or vig. As odds are set for every game or match, the odds will reflect a mathematical commission in the bookmaker’s favor.
Point Spreads: In some sports, bookmakers will use point spreads to bring teams closer together in value. This is very common with football and basketball. Bookmakers do this because as we stated earlier, teams are very seldom equal in talent and success.
Bookmakers employ oddsmakers or subscribe to services that provide odds for sports games and matches. The job of an oddsmaker is to evaluate each game using statistical information. As it pertains to creating point spreads, the task at hand is to come up with a number that brings opponents as near to equal as possible. By doing this, they can create betting action on a game that might otherwise be unattractive from a betting standpoint.
Example: Notre Dame (ranked #5) is playing unranked Navy at Notre Dame. In all likelihood, Notre Dame would win this game by a large margin. Bookmakers are aware of this and want to set a point spread that indicates just how much better they believe Notre Dame is than Navy. The final point spread result might read as follows:
- Notre Dame -31 (-110)
- Navy +31 (-110)
Note: The money line indicated when using point spreads is usually set at -110 on both sides. With that said, bookmakers might make small adjustments to either the point spread or money line if one side gets too much action. The bookmaker’s goal is to balance the books (equal bets on both sides) on every game or match. If they can do that, they collect the vig with no real risk.
Types of Sports Wagers
Almost all retail and online sports betting operators offer a wide range of betting options. Sports bettors tend to like making certain types of wagers based on their preferences, bankroll, and willingness to take bigger risks for bigger returns.
The following information represents a list of wagering types that are most common among U.S. bookmakers. From time to time, some bookmakers might offer creative betting options, but the most common options are the ones listed here.
- Straight Bet: A straight bet is the most common type of sports bet. It involves a wager on a single team or player in a single event. To win the bet, the bettor must make the correct selection. The only exception is if the game or match ends in a tie, in which case the bettor will get a refund of the amount they wagered.
- Parlay: A parlay is a wager that involves the use of two or more players, teams, or outcomes. Each selection on a parley ticket is referred to as a leg. A parley is only a winner if all legs of the parlay win. The only exception would be if one of the legs ends in a tie, in which case the number of legs on the parlay ticket would be reduced by one with the payout on the ticket also being reduced accordingly.
If using point spreads, winning parlays will usually pay at odds as follows:
- 2 Legs 13 to 5
- 3 Legs 6 to 1
- 4 Legs 11 to 1
- 5 Lets 22 to 1
- 6 Legs 40 to 1
The payouts for more legs will continue getting larger.
Teaser: Sometimes, bettors aren’t real comfortable with the point spreads a bookmaker might list. A teaser will allow bettors to adjust the lines for two legs or more (similar to a parlay) by a prescribed number of points. This helps bettors secure a better point spread on their games of interest, but the payouts are much lower than a parley with the same number of legs. Let’s look at an example.
Example: New England Patriots are favored at -5 points versus the Green Bay Packers. If a bettor uses this game on a 6 pt teaser, they will be permitted to move the line to New England +1 if they like the Patriots or Green Bay +11 if they like the Packers.
Every game on a teaser ticket would be treated in this manner. Each teaser ticket has to have at least two games, which would pay at +100 or even money. More legs on the teaser would result in bigger payouts.
- Proposition or prop bet: To create more betting opportunities on particular games, bookmakers might decide to post proposition betting opportunities. A proposition or prop bet is a wager on an occurrence or non-occurrence during a game. Prop bets don’t usually have anything to do with the outcome or score of the game. Instead, these types of bets allow bettors to wager on player performance, team performance, or unique outcomes that might or might not occur.
- Player Performance Prop Bets: Based on how individual players perform or how two or more players perform in comparison to each other or other players. Examples (using football):
- Will Player A score touchdown, yes or no?
- Will Player A go over or under a prescribed number of yards?
- Which Player A or B will have the most yards rushing?
- Which player will score the games first TD?
This list can go on and on.
- Team Performance Prop Bets: Based on how individual teams perform or how two or more teams perform in comparison to each other or other teams. Examples:
- Will Team A Score over or under 31 points?
- Will Team A or Team B kick the longest field goal?
- Will Team A of Team B have the most penalty yards?
- Which team will score last in the game?
Again, this list can go on and on.
- Unique Outcome Prop Bets: This category would cover unique outcomes, and whether or not certain outcomes will occur. Examples:
- How long will it take to sing the National Anthem?
- Will there be a safety during the games?
- Will there be a scoring play in the last 2 minutes of the first half?
As you can see, the possibilities are endless. That’s why the Super Bowl brings out the prop bettors who love feasting on as many as 500 different prop bets. It’s worth noting that each prop bet comes with stated money line odds and or a point spread when applicable.
- Future Odds Bet: Future odds bets involve betting on something to happen in the future. Most future odds bets revolve around a player or team performance. Since bettors are betting on something to occur in the future, they will usually be rewarded will nice odds. This is fair and necessary because bettors don’t have access to future information that could affect the outcome of whatever they wagered on.
If a bettor was to wager on a certain baseball player to lead MLB in home runs at the end of the season, they are taking a significant risk. Why? The player in question could get injured, causing them to miss the entire season. Once future odds wagers are on the books, they are generally non-refundable.
The most common and popular future odds wager involves which team will win the next Super Bowl. Some bookmakers will post this betting opportunity as much as a year in advance. As stated above, the odds on each team will be nice, especially if the NFL season is not yet underway. The nice odds reflect the risk the bettor has to take, knowing key players could get injured.
- Live Action in-game betting: While future odds betting allows bettors to bet on an occurrence in the future, live-action in-game wagering allows them to wager on occurrences that are happening as the game in question is being played. This is quickly becoming a favorite betting option for sports gamblers all over the world.
Possible Live action bets include updated lines and point spreads on a game as scoring occurs, wagers on the outcome of a single play, and wagers involving player and team performance during the game.
Betting Limits
Each retail and online bookmaker will set the betting limits they are willing to accept from customers. There are no industry standards. If a bettor has a reputation as a high roller, most bookmakers will extend them the courtesy of accepting big wagers from them. Of course, bookmakers will use discretion because they don’t want to accept any more risk than necessary.
Sometimes, bookmakers will restrict the action on a particular game or match if they have concerns about potential news/weather issues that could affect the outcome of a particular game.
It’s perfectly acceptable for bettors to request special considerations in terms of betting limits.
Sports Handicapping
At this point, you should have a general idea about sports betting explained. You now know about the process and how it all works. Now, it’s up to you to figure out how to make winning bets.
As a casual sports bettor, you might simply prefer betting on teams and players that you follow. There is nothing wrong with doing that approach, although it’s not the best way to consistently beat your bookmaker. If you want to optimize your chances of consistently selecting the right teams or players, you will need to invest a little time and money to do some handicapping.
The great thing about sports is each game or match occupies a place in history. All of the outcomes can be used to create a huge database of handicapping information. Even more useful is the fact that statistics are now tracked for almost every major sports league, team, and player in the world. You have access to all of this information right from your PC or mobile device.
Through online news services, you also have access to weather information, injury reports, player and team updates, and handicapping picks from pro handicappers (touts). You can even pay for handicapping information or picks if you don’t have time to do your own handicapping.
The point is you do have access to all the information you will need to make an informed decision on each potential game and wager. You do have the potential of becoming a good sports handicapper, which should improve your chances of winning more bets.
Regardless of how much information you have at your disposal, consistently winning money as a sports bettor is a difficult thing to do. All the handicapping information you gather might paint a picture about what you can expect, but then the unexpected things happen. You cant control it, and that is why they call it gambling.
Conclusion
There are two general rules you should follow when betting on sports games, matches, or events. First, have a good time. Betting on sports should be a fun and exciting endeavor, certainly made more fun when you win a bet or two.
Second, never bet more than you can afford to lose. As a rule of thumb, your sports betting bankroll should consist of the discretionary money you have remaining after you pay all of your bills and put savings in the bank for your future.
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