Market Inefficiency in sports betting is where the real money is made. These inefficiencies occur when the odds provided by bookmakers do not accurately reflect the true probabilities of an event. Understanding and exploiting these opportunities can create a profitable sports betting expert out of a casual. Here we will explore the different types of market inefficiencies, how to find and exploit said market inefficiency and how tools like Portfolio EV can help you gain an edge.
Sports Betting Market Inefficiency: How to Take Advantage
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Types of Market Inefficiency
Line Movement Inefficiency: Odds shift based on how money is wagered. However, not all line movements are accurate reflections of the actual probability of outcomes. Sometimes, lines move due to public sentiment or large wagers from uninformed bettors (also called “squares”). These are opportunities to identify when the market is overreacting and bet against the movement.
Market Overreaction: The sports betting market can overreact to recent events, like a star player’s injury or a team’s poor performance in the previous game. This often leads to odds that are skewed in favor of the opposing side. Savvy bettors (aka “sharps”) can capitalize on these overreactions by betting on the other team or taking advantage of inflated odds.
Market Timing and News: Odds may change as new information becomes available, so the best way to exploit this is by staying on top of the most up-to-date news possible — or better yet, try to understand what information may already be baked into lines. For example, sportsbooks will factor a key player being questionable into their odds (if they are keeping it on the board) by treating them as playing, sitting or hedging to be somewhere in the middle. Knowing exactly where the sportsbook is falling in these situations is not easy, but better understanding these movements can be a huge help to bettors.
Arbitrage Opportunities: When different sportsbooks offer different odds on the same event, there’s an opportunity for arbitrage — placing bets on all possible outcomes to guarantee a profit. While these opportunities can be rare and often disappear quickly, they represent a clear market inefficiency.
Luckily for you, OddsShopper has an Arbitrage Tool that finds these inefficiencies and explains exactly how you can bet them to make guaranteed money. Check our guide to arbitrage betting for more information.
How to Exploit Market Inefficiency
Betting models like Portfolio EV can help identify inefficiencies by comparing predicted outcomes with the odds offered by bookmakers. Our model evaluates what odds should be (called true odds) based on how likely the bet is to win and cross references that with the actual sportsbook odds.
If the sportsbook odds are longer than what the true odds are, then the bet is considered to have “positive expected value” (+EV) because we have found a market inefficiency.
Timing is everything in exploiting market inefficiencies. Placing a bet as soon as new information becomes available, or waiting until just before the game when the market has overreacted, can make the difference between a winning and losing wager. Also, don’t put all your eggs in one basket. Spread your bets across different sports, leagues and markets to increase your chances of finding inefficiencies. This strategy also helps manage risk and smooth out the variance in your betting results.
Real Examples of Market Inefficiency
During the 2023-24 NBA season, there were quite a few instances where the market overreacted to a star player’s injury. In one case — a Mavericks-Timberwolves game — Luka Doncic was ruled out for a game, and the line moved heavily in favor of the Minnesota. However, the Mavericks were respectable without Doncic, and savvy bettors who took advantage of the overreaction found value in betting on Dallas.
Weather conditions can also cause market inefficiencies in the NFL and MLB. For example, when a game is forecasted to have heavy rain, the market often overreacts by lowering the total. However, not all teams are equally affected by weather, and bettors who understand the nuances of how weather impacts play can find value in betting the over or the under based on the specific teams involved.
When it comes to arbitrage betting, tennis matches often are a good source, especially in live betting, since this is an area where books can differ pretty widely on odds. For example, if one sportsbook offers odds on a player winning a set at +150 and another offers -140 on the opposing player, you can bet on both sides and guarantee profit regardless of the outcome.
How Portfolio EV Can Help
Portfolio EV are designed fully with the goal of helping you identify and exploit market inefficiencies with precision. Here’s how:
Real-Time Odds Comparison: OddsShopper provides real-time comparisons across multiple sportsbooks, allowing you to spot discrepancies and potential arbitrage opportunities.
+EV Betting Models: Our tools integrate sophisticated betting models that highlight bets with positive expected value. These models use market data, statistical analysis and real-time information to identify where the odds are in your favor.
Bet Tracking and Alerts: OddsShopper’s tools also offer bet tracking and alerts, so you can stay on top of line movements and market changes. This makes sure you’re always in the best position to exploit inefficiencies, whether you’re exploiting them early in the day or right as the games start.
Conclusion
Exploiting market inefficiency is the key to long-term profitability in sports betting. By understanding the different types of inefficiencies and how to take advantage of them, you can gain a significant edge over the market. Tools like Portfolio EV make it easier than ever to identify and capitalize on these opportunities, helping you develop profitable sports betting habits.
