Poker and sports betting
It’s undeniable that luck has a play in nearly all aspects of life.
As Woody Allen said in the famous intro to Match Point:
“People are afraid to acknowledge that a big part of our lives relies on luck. It’s scary to think just how many matters are out of our grasp”
However, there’s a question that’s always buzzed in my mind… Why are the best poker players always the same?
If it was all luck, why don’t you sign up to the World Series and take the prize? Are they just very lucky people?
Sports betting is a skillful game. Just like poker.
A game about having partial information and making decisions as you fight your way through uncertainty. Just like in poker.
In short, there’s a luck factor played in the end result that can make you win after an atrocious decision, as well as making you lose after an insightful one. Rough, but that’s how it is.
A good kind of player is the one who will make so many insightful plays that, over time, they’ll give them an edge over the others. Unfortunately, by just looking at the results, distinguishing between luck and skill isn’t always simple.
And this isn’t just related to poker or betting. We can experience it in our daily lives, where a good decision won’t always guarantee your success, but a long string of them should provide more assurance.
Once established, I wonder…
What’s the most accurate outlook? Talent and luck? Majorly just luck? A matter of chance? Daily work?
Well, I’m not aiming to break down the topic in depth. I’ve got obligations to take care of, and your time is limited 😉
But I’d like to touch on how luck relates to sports betting and how it can influence your short and long-term results.
A personal story about luck
Making good decisions is, along with work and happenstance, one of the founding pillars of success.
Regretful as it is, the moment we’re finally ready to make proper decisions is when we become adults. And honestly, that’s a problem because it means that a big part of our important life decisions must be taken when we’re young, inexperienced, and lacking information.
The way I see it, the one who manages to make decisions through uncertainty, accepting that a good one won’t always be synonymous with success, is the one who has come to understand what this is about.
I have a theory about this.
In the game of life, unlike in poker and sports betting, our lives are short of bank.
We make just a few crucial decisions, and we can’t make them enough times until we’re trained to always make the best call. In other words, we won’t reach the long term in those decisions.
Let me tell you a brief story.
In 2015 or so, WinnerOdds didn’t exist yet.
I only had an Excel sheet and a PDF document entailing what I thought could end up becoming WinnerOdds. I had an idea in mind regarding how to develop it, but a few pieces were missing.
I don’t know if fate, luck, or mere serendipity made it so that going to a party would get me introduced to Marc. And that, at the same time, he knew Juanan, Jose, and Manu.
They are the original team that turned the Excel sheet into a website and the PDF document into a successful business operation. Without them, none of this would’ve come to fruition.
It’s inevitable for me to wonder whether luck played a significant role in our lives or if all of it was already set in stone. I’ll never be able to know.
If you bet on Value Bets, winning is inevitable
In this Roman circus comprising the sports betting world, it’s common to come across dogmatic sayings, such as that sports betting is an uncertain, hazardous practice, and that making a profit is but a strike of fortune.
Some say so due to ignorance, whereas others base the claim on an unlawful and shady strategy. There’s a bit of everything.
Part of it is true; we desire, via multiple biases, to have control over everything we do, but the truth reveals that sports betting, just like stock market values, is inherently uncertain.
Basically, nobody knows what the price of Google will be tomorrow or what team will win La Liga next year.
As for Football, for example, matches develop in a complex and chaotic way, on top of being non-deterministic, considering that match results, at least in the short term, can be entirely swayed by chance. Whether it be because VAR is applied differently every round or due to player injuries.
Most bettors are aware that both good and bad luck can play a crucial role in individual bets. However, the subsequent question is how much luck affects long-term results.
The way I see it, making money in sports betting isn’t about picking winners.
The secret lies in estimating the real probabilities of a match better than the bookies and casual bettors.
In short, when stats play in your favor, winning is inevitable. It’s not cheating or relying on strokes of luck, no matter what some may try to convince you about. Be positive about that.
Some factors that dilute luck in sports betting
To be able to understand this, we can’t ignore a term you’ve surely seen and heard from time to time. The infamous “variance”.
It just refers to the dispersal of the obtained result relative to the average expected value. Or, simply put, how much YOUR results differ from the average.
We observe daily that some users aim to always make the same winnings, month after month, as if this was a fixed-term deposit, but ignore the most important part—luck and dispersion—which in the short term can feel like daggers falling from the sky.
Not only that, but by just comparing results from WinnerOdds users, we see that they can vary wildly, as not everyone will always place the same bets.
So variance, or luck, is too substantial of a variable to be shrugged off.
One of the best antidotes to make luck less vital in your investment returns is to place as many bets as possible.
In the last article, “why people fail to use WinnerOdds properly”, we laid out several real cases from our users.
One of the most remarkable ones is what we call “the stoic user”.
Take a good look at this graph. What do you draw from it? Would you think it illustrates a successful tipster?
While on the journey, luck can wreak havoc and cause stagnation, regressions, and heart-wrenching nosedives, all of which will truly test your resilience.
But this image leaves us with a valuable teaching, which is that the one who perseveres through an EV+ method is far more likely to win over the one who quits midway.
It also shows that good things don’t tend to be quick or easy and that shortcuts rarely steer you toward the right path.
So, if you’re not the type of person to cut around every corner, and you know that ending up a winner in sports betting isn’t a matter of luck, what I’m about to tell you will be of your interest.
Our calculator blog
Some time ago, we published a calculator that, amongst other things, helps you understand the efficiency of your betting system after filling in a few simple parameters.
Probabilities are often counterintuitive, and you must think things through to fully understand every number.
What we can draw from the calculator is that if you have a method that outputs a long-term positive yield, the higher the number of bets, the less likely to face negative results.
So, over the months, years, and thousands of bets, “luck” becomes less relevant in your results.
As we’ve also seen in the stoic user example, the one who follows an EV+ method ends up winning sooner or later.
The problem in all of this is that not everyone is able to get there, oftentimes abandoning part-way, taken aback by negative results.
You’ll be able to understand with this example that follows two imaginary tipsters.
- Bad but lucky tipster
- Good but jinxed tipster
Let’s get on with the first one.
Imagine a startup tipster who chooses their picks by eye and doesn’t have a verified method that’s undergone significant backtesting. They tend to bet on 2.0 odds, to wager 1 unit, and have obtained a 10% of yield after 100 bets.
-“Outstanding, I’m the boss”
All right, but… What’s the likelihood that luck was merely on their side?
Let’s take a look.
If they’re betting on a single bookie that imposes a 5% commission, with no skill as a tipster, their long-term yield will be -5%.
Knowing this…
After 100 bets, they’ll have a 5.46% chance to end up with a yield above 10%. Only by chance.
Basically, we could say that if a blindfolded chimp was choosing picks on 2.0 odds, 1 out of 20 tipsters would be able to boast about a 10% yield.
Now, let me ask… How many tipsters are there out there? Hundreds? Thousands?
These values are scarily telling, and it’s not unreasonable to think that many of the ones who are at the top with very few picks have gotten successful by chance.
In order to demonstrate this example, I had to press the calculate button over 20 times until a positive case came up, but I ended up obtaining this graph in which a lousy tipster is a winner after 100 bets.
However, if we increase the number of bets from 100 to 1000, the chances of obtaining a 10% yield are virtually zero.
This evidences that, in the short term, luck can have a major influence in a good and bad way. A bad tipster can have incredible results in the short term without the need for a winning method.
The crux of the matter is determining whether your results are mere happenstance or consequence of your expertise.
The second example is the good but jinxed tipster.
They’re a real brainiac and follow a proven method to a T. Long-term yield of 10% on 2.0 odds… A certified goldmine.
What are the chances they’ll lose more than 10 units after 100 bets?
After whacking the arithmetic machine, we get this: 100 – 97.6 = 2.84%
So, only a 2.84% chance.
After pressing the calculate button over 50 times, I obtained this graph:
What we see is that a good tipster capable of obtaining a 10% yield has nearly a 3% chance of finishing up a full month with -10 units, even reaching as far as -20.
Does that mean they’re unqualified? No.
But they may be seen as a clueless tipster. A total dead loss. Maybe even quitting before it gets too bad.
Impossible to be a winner with those results…
Well…
If, instead, you look at the 10.000 bets picture, you’ll abandon the luck’s realm and view things with a much broader scope.
The one who reaches this level alive has a robust, tight, and adequately thought-out system.
Here we see what truly matters. The long-term yield. This is what sets you apart from the rest.
These are two crystal-clear graphs. There’s no questioning who’s the best.
What I want you to establish from this is that, long-term-wide, luck is inconsequential. The good tipster’s path is a near-constant incline, straight to the moon. If you zoom in, you’ll see a sawtooth with bumps and significant declines, including a 25-unit drawdown, but that’s irrelevant in the long term as the graph escalates higher and higher despite everything.
On the other hand, the bad tipster’s long term is an apparent calamity that you couldn’t have seen coming after the initial 100 bets.
Conclusion
Be sure that, although luck plays a hand in sports betting, the long term isn’t governed by good fortune alone.
The moral of the story is evident.
Deep down, no matter how much we rack our brains, the short term has components that are simply out of our grasp. No matter how much we study and prepare ourselves, there are variables that can’t be tamed.
But, as we’ve concluded, the luck factor diminishes in the long term, and as long as your approach is backed up by probability estimation and the hunt for positive expected value bets, winning is inevitable.
That’s why poker winners are always the same and why WinnerOdds has been outplaying the bookies for the past 7 years.
What about you? Are you shortsighted or farsighted?
Saludos
Miguel Figueres
