If you trade cryptocurrencies or stocks, you will love trading sports markets.
Like crypto, sports markets are volatile and inefficient. However, sports markets also have high liquidity and a near-infinite amount of data to make logicial decisions with.
If you’re interested in understanding why crypto traders love sports betting exchanges, read this.
Sports Trading 101
Learning how to trade sports is surprisingly easy. Sports are a huge part of day-to-day life and most people already understand and follow multiple different teams and leagues.
By definition, traders profit by buying and selling things at different prices.
When it comes to sports, you still want to buy low and sell high…only instead of stocks or cryptocurrencies, you’re buying and selling different sport outcomes. Will team A or team B win? Will the total score of the game be over or under? Will player A score more or less than X points?
Sports markets are volatile, which makes them easy to trade. Odds change quickly and sports betting sites offer many different odds. On top of that, the amount of sports data available is staggering, with advanced statistics for every imaginable situation. Being able to look at accurate probabilities of who will win makes it easy to find profitable opportunities.
Before we get into specific sports trading strategies, let’s take a look at some basic principles.
General Sports Trading Tips
Start Small. Like anything, it takes time to learn a new skill. And you definitely won’t be an expert the first time you try something. The same idea applies here. Start by learning how to trade a single sport, ideally one that you already follow or know a lot about. After you’ve picked your sport, start with a small amount of money in your account. Once you get the hang of things, you can always deposit more and expand to other sports.
Bankroll Management. The total amount of money in your sports trading account is called your bankroll. Managing your bankroll means setting specific rules for how much you will trade on a single bet. You can pick a fixed or variable bankroll strategy, but the amount you choose will depend on the sport you’re trading and your overall trading strategies. Fixed bankrolls mean betting the same amount on every game ($50). Variable bankrolls mean betting the same portion of your account on every game (4% of your total account).
Use Predictive Models. It’s difficult to determine which odds you should take if you don’t have anything to compare the odds to. This is what you should use a model for. Fivethirtyeight.com produces detailed predictive models for NFL, NBA, soccer, and more. There are a number of other websites that do the same. Once you choose a market to bet on, compare the odds being offered with each team’s predicted chance to win to see if the team is over or undervalued. After you learn the basics, you can start making your own models!
Hunt for the best odds. After you’ve chosen how much to bet, and have used models to figure out how likely different sports outcomes are, it’s time to look for the best odds. Websites like oddschecker or odds portal show all the different odds offered by major sportsbooks. However, you’ll have to create accounts at each one..so we suggest sticking to 2-3 at the beginning. Knowing the difference between sportsbooks and betting exchanges is important, but you’re more likely to get better odds on betting exchanges like Betfair or SportX.
There you go, now you understand the basic tips that every sports trader should know and follow. These strategies are designed to keep you focused on profitable opportunities, and help you avoid making emotional impulse trades.
4 Profitable Sports Trading Strategies
Value Betting is based on the idea that there are bets where the actual chance of a bet winning is greater than the odds you take. This is similar to a trader discovering that a company’s stock is undervalued by the market and smart traders can profit when the stock price increases in the future.
Value betting requires starting with a strong predictive model that can accurately predict the sports you are looking to bet on. The risk with this strategy is that your bet still loses, despite the value you got. However, if you consistently pick undervalued bets, you will make money in the long run.
Market Making involves offering odds on both sides of the same market to guarantee a profit, regardless of which team wins. You can only market make on sports betting exchanges, like Betfair or SportX.
Since betting exchanges match bettors peer-to-peer, you can offer odds for other bettors to take. By offering odds on both teams to win, you can generate risk-free profit if both of your bets are taken.
The risk here is that you won’t be equally hit on both sides. If both of your odds aren’t equally filled, you will have to decide if the exposure you have is acceptable, or hedge out.
Trading Odds Movements means correctly predicting how odds will change over time. While generally harder than value betting or market making, it can be more profitable if done correctly.
Odds can change for many reasons. As traders identify undervalued odds and snatch them up, the odds will change to reflect this shift in demand. If the weather changes or injury reports are released, odds can change as well.
This strategy starts by following the same steps as value betting. At first, you want to compare predictive models with available odds to find undervalued bets. As the odds change over time, you can decide to trade the odds movement (for risk-free profit), or keep your original value bet.
The risk here is that the odds will not move in your favor. You can mitigate this risk by only placing value bets that you would be happy taking even if the odds don’t move in your favor.
Arbitrage Strategies generate profit by scanning multiple sports betting sites for different odds on the same game. These types of strategies require automatic betting bots, which can be time-intensive to set up. As a result, this strategy is recommended for advanced, technically knowledgeable bettors only.
However, it does represent a risk-free way to profit instantly.
Generate 10% Monthly Returns with Sports Trading
Applying these four trading strategies to sports betting markets means that traders have low-risk methods for consistently generating profit.
The goal of any good trader is to maximize return while minimizing risk. With well executed sports betting strategies, traders can generate monthly returns up to 10%!
10% per month may not seem like a lot, but that’s double the average amount that stocks increase in value over the course of an entire year (adjusted for inflation).
Sports betting is an inefficient market, with multiple opportunities for profit for disciplined, smart, sports traders.
Alright, enough with the theory talk. Strategies and models are cool, but it’s time to roll our sleeves up and learn how to actually use a sports betting exchange.
Keep Reading: How Does SportX Work? Crypto Sports Betting Explained