In the last blog post, we discussed the differences between sports betting and investing. I hope it helped ease your concerns on both topics. Of course, as when you try to invest on your own, it’s important that we learn some basics on sports betting.
I won’t even use someone’s Netflix password because it feels like stealing, so I could never play with the illegal sports books. As an avid sports fan, I was excited about sports betting finally becoming legal in North Carolina. I signed up on day one for research, but also to play a little.
We have a variety of companies, called SportsBooks, where can choose to place our bets.
From what I understand, they’re all basically the same, so just go with what feels comfortable for you. I chose DraftKings mainly because the other companies’ commercials were just too annoying.
To understand the industry better, I read Interception: The Secrets of Modern Sports Betting, by Ed Miller and Matthew Davidow. I’ve always found gambling and casinos interesting, but I never
studied it because it was illegal here. Those gangster movies also scared me enough to avoid the industry.
The book went over the rules and how everything works in sports betting. I think the most interesting point was that the app should be treated like a brick-and-mortar casino. As you know, “The house always wins.”
Basically, if you think you have a sports betting system to beat the house, just stop.
Yes, there are many rules designed to protect the consumer because gambling is so addictive. The house rules, however, are designed to protect the casino.
We have all seen in the movies where security throws someone out of the casino for counting cards. They can do the same thing in the app. If the company sees you winning too often, or making them look bad in general, they can stop taking your bets. No questions asked, you’re just cut off!
They can even blackball you for the entire industry. In this age of instant communication your only choice is to play nicely or not play at all. As with investing, don’t bring fantasies of instant fame and fortune on this journey. Bring your discipline and your patience.
Sports betting became legal in North Carolina just in time for the ACC Men’s Basketball Tournament.
My NC State Wolfpack won the event and then both the Men’s and Women’s teams advanced to the Final Four. I started thinking sports betting was easy. Of course, I only bet about $15 a game, so I wasn’t getting rich by any means.
However, I did see how people can become addicted to sports betting. We experience joy when our team wins. Investing can also be addictive because it is thrilling to see your stock picks rise.
If the winning feelings are similar in gambling and investing, then the other side is similar as well. Both the stock market and casinos can humble you quickly, so leave your ego out of it. Accepting failure is hard, but necessary.
After my first 100 bets, I won 49 and lost 51. I’m still ahead in money because some bets pay differently from others, but it was interesting to see I had a losing record. It felt like I was doing well.
Sports betting and other online social communities should never completely replace our real community.
Sports betting experienced high growth during the pandemic because the apps gave betters a community. Sports betting wasn’t legal in North Carolina at the time, but now I can see how it can be a crutch for loneliness. However, as with most things, we must be careful not to indulge.
When you’re in a physical casino the staff treats you like royalty as long as you’re playing. Everyone is your best friend and you’re having the time of your life. It’s hard to explain, but the app treats you nicely as well.
For example, they give you $200 when you open the account. There are deadlines where you must bet the money before it disappears, though.
It’s the typical “drug dealer” business model. The first taste is free to get you hooked. They want you to play as soon as possible.
There are two rules I have for anyone trying sports betting or investing on their own.
First, only invest money you’re willing to lose. Second, only invest in what you know. I think these rules are important for sports betting as well.
Prior to doing anything, understand there are always risks when money is involved. Obviously, the risk of losing money comes with investing and gambling. When inflation is higher than the interest you receive in a “safe” savings account, your money faces the risk of losing value.
Even when we go to work, we face risks traveling to the office. The promise of a paycheck makes these risks acceptable. Gambling or investing make no such promises, so you must be willing to lose.
Investing has proven throughout history that it can provide the highest returns over time. Gambling promotes similar ideas of wealth and glamour. Both are too dangerous for you to risk the money earmarked for your mortgage or car payment.
DraftKings has many ways for you to bet, so it’s important to stick with what you know.
I know nothing about UFC or golf, so I avoid those. I also think only betting on teams you follow is smart even if you are an expert on a sport. It just makes sense!
Only an NC State fan could honestly believe their team would win their first ACC Tournament Championship since 1987. I will happily put $5 on that bet every year. That bet won’t make me rich, nor will it make me homeless.
If you decide to try sports betting, understanding the numbers is helpful. While there are many bets on DraftKings, the basics seem to be bets on spreads, over/under totals, and money line. The odds for each are set by the Sportsbook.
DraftKings uses American odds, which is what you see sometimes before a game on television. This system bases the odds on a $100 bet, but it’s easy to adjust it for smaller or larger bets. Not to mention the DraftKings app calculates the expected payout for you, so don’t be afraid of the math.
For example, for a Carolina Hurricanes playoff game, the app will show you something like this:
Game Date Puck Line Total Money Line
CAR -1.5 O 5.5 -162
+164 -102
NYI +1.5 U 5.5 +136
-198 -118
First, the “money line” bet is probably the easiest because you are just picking the winner. In our example, the Hurricanes are the favorite because of the negative sign before the odds (-162). The underdog would pay higher if you picked them to win.
The “puck line” bet is a little more complicated because it involves a spread. Choosing the Hurricanes to win here will pay more (+164), but only if the Hurricanes win by at least 1.5 goals (-1.5). On the other hand, the opponent wins (-198) if they win or even if they lose by less than 1.5 goals (+1.5).
Personally, I enjoy the “total” bets because I can still win if my team loses. These bets are just the total points scored in a game. In our example, you can bet whether there will be more or less than
5.5 goals scored.
All of these bets are separate bets, so you can diversify like in a stock portfolio. By betting $5 on the money line and $5 on the total, I can usually break even as long as one bet wins. Again, I won’t get rich quickly, but it can add up eventually.
I realize it seems strange for me to post so much about sports betting.
As a fiduciary, I cannot encourage dangerous or reckless behavior with your money. I don’t take that duty lightly, which is why I spent the past few months trying to educate all of us on the subject. I see sports betting as an opportunity to help someone build a better life. Obviously, I feel the same way about investing considering my career choice.
Life is hard, but we still make daily choices that could impact our future. We must maximize our opportunities when our resources are limited. If you only have an extra $10, I prefer to see you try to win at sports betting than see you buy a drink at the bar. Feeling sorry for ourselves is not productive.
We cannot rely on someone to just bring more money to us, but we can maximize our resources. It will take some discipline and we’ll have to take some risks. I truly believe an American dream is available to all people. We must figure out what that dream is for ourselves and have the courage to pursue it. Email me!
