Football betting

How do bookies charge for betting on football?

The odds are set in such a way that no matter the outcome of the game, the payouts are less than the receipts.

They take 10% of winning bets. If you bet $50 and win, instead of getting back $100, you get $90.

A bookie’s job is similar to an accountant. They don’t care about who wins or loses. They don’t even need to care about the realistic odds of one team winning over another. They set the odds and move them over time so that the money bet on one side is about equal to that of the other. Done correctly, they always win since they just take their service percentage and redistribute the rest among the pool of bettors. The specific fee they charge for the organization of the bets in the first place depends on the bookie and the laws (if it is legal) where they are placed. 10% is as good a number as any.

To amplify the correct answers above: this is the purpose of the “point spread” you hear about. The Carson City Mashers are well acknowledged as a much better team than the Boise Milquetoasts, so instead of offering a straight win/loss bet when those teams meet, the bookie only offers a bet that says the Mashers have to win by 11. If they win by 10 points, then the bookie pays off as if the Milquetoasts had won.

So instead of everybody betting on the far superior Mashers, half of them think the Mashers are better, but not 11 points better, and the other half figures even that handicap will fall to the Mashers’ vaunted running game and aggressive defense. This insulates the bookie from a longshot coming in, because the same action is sitting on both sides of the ball. He takes his profits in what is essentially a service fee.

That’s the ideal scenario; as Shagnasty says, the better the bookie is at placing the line (and at adjusting it over time as public opinion changes), the closer to even he comes and the safer he is from going bust (and getting his legs broken).

In stuff like horse racing, the same effect is achieved by paying off more for a winning bet on a longshot, driving action towards them and away from the more likely winners.

–Cliffy

I really don’t understand what you’re saying here.

  1. Bookies don’t “take 10% of winning bets”. In most countries the bettor will have to pay a percentage in tax to the government, either as a percentage of the stake or a percentage of the winnings.

  2. You’re assuming that the odds are 2/1 against each outcome (home win, away win, draw), which of course they won’t be, depending on the relative merits of the team.

In answer to the OP, bookies don’t charge to take bets. They don’t need to offer “point spreads” or anything fancy, either. They just adjust the prices they offer on each team so that they will make money whoever wins.

E.g. if Team A is big favourite to win over Team B, the odds might be:

Team A: 1/2 , or 1.50 in decimal odds. Implied probability = 1/1.50 = 66.7%

Team B: 5/1, or 6.0 in decimal odds. Implied probability = 1/6.0 = 16.7%

Draw: 5/2, or 3.50 in decimal odds. Implied probability = 1/3.5 = 28.6%

Therefore the book adds up to 66.7+16.7+28.6 = 112%, meaning the bookie has a 12% advantage over “fair prices”. Assuming he takes bets in the right proportions (which is an art in itself and can require adjustment of the prices to draw in punters on less favoured outcomes), he will make money.

Those are two different kinds of bets, though. You might as well bring parleys and into it. Neither style is more legitimate than the other; it’s up to the customer which game they want to play.

You’re wrong Colophon; with regards to betting American Football, which is what I’m going to assume is what the OP was asking about. The bookie’s job, if done correctly is to simply transfer money from the loser to the winner, and taking his ‘vig’ in the process. Wikipedia actually has a pretty good explanation of spread betting: http://en.wikipedia.org/wiki/Spread_betting. *** “The spread is intended to create an equal number of wagers on either side, the implied probability is 50% for both sides of the wager. In order to profit, the bookmaker must pay one side (or both sides) less than this notional amount. In practice, spreads may be perceived as slightly favoring one side, and bookmakers will often revise their odds in order to manage their event risk.”***

Well, he didn’t specify *American *football. In that case, all bets are off. :stuck_out_tongue:

As others have pointed out, there are a variety of correct ways of doing it. For example, the local parlay cards pay 5 to 1 odds on correctly predicting 3 football games (with point spreads added). There is no service fee! However, assuming the point spreads are correct, a bettor would have a 1 out of 8 change of hitting 3 games, but the bookie pays out 5 to 1 instead of 8 to 1. There is the profit and no need for a “service fee.”

Of course (American) bookies charge for bets.

On a straight-up bet, if I plop down $100 in Vegas and lose, I lose $100. If I win, I win $90 on most bets, although some have a larger or smaller vig.

It’s opposite with my phone bookie, however. With him, if I bet $100 and lose, I owe him $110. If I win, I win the full $100.

haha, I didn’t want to get caught on a technicality; so that’s why I made sure I specified American Football.

“all bets are off” I see what you did there!

That seems odd from a British persepctive. Here, the odds are set to give the bookie a profit, and the odds you take are the odds you get.

If I back a team for £10 at 3/1 and they win, I get £40 back (£30 winnings plus my £10 stake). If they lose, I simply lose £10. In the past you had to pay tax (9% IIRC) which you could choose to pay on your stake OR on your winnings. So I could either pay £10.90 as my stake, and then get a full £40 back if I won, or I could pay £10 but then only get £37.30 back if I won. Betting tax was scrapped in 2001, though.

Of course, on a true even-money bet, e.g. betting on a coin toss, the odds the bookie gives are likely to be only about 10/11 or thereabouts, to give him an edge. So yes, he is charging for the bet, but that is built into the odds rather than being an “extra” charge.

Moving to the Game Room from GQ.

Colibri
General Questions Moderator

I’m guessing that point-spread based betting doesn’t work so well in (what’s known in the US as) soccer due to its relatively low scores.

There are essentially two ways for a bookie to run things if he wants equal money on both sides, and both have been described here:[ol]
[li]Offer asymmetrical odds on straight-up victory; or[/li][li]Offer symmetrical* odds on the result biased by point spread.[/li][li](I suppose there’s nothing stopping someone from offering a hybrid, but in my admittedly limited experience I’ve never heard of it. I suspect that most would find it adds excessive complexity for little gain.)[/li][/ol]The point-spread method is by far the most popular here for American football and basketball, in particular. Margin of victory is a very rough measure of the winner’s dominance, but the bookie has a fair amount of range over which to turn his point spread knob and a reasonable granularity within that range. Spreads of in excess of 10 points aren’t unheard of in football, and half-point increments can be used (non-integer spreads exclude the possibility of a “push”), so he’s got at least twenty or so places to set the spread.

For soccer, a three-goal victory is usually the result of utter domination, so I would imagine the bookie has much less practical range to fine-tune his proposition; a half-goal movement of the point spread may result in the betting swinging farther than the bookie can live with (meaning he can’t practically achieve equal money on both sides). Instead asymmetrical odds appear to be the technique of choice, where the resolution is limited by just how big you allow your integers to get. (Chelsea over Liverpool at 371:378! :wink: )

Irrational odds would be amusing, but very impractical…

    • The bookie’s profit in this comes from the “symmetrical odds” being slightly less than 1:1. 0.9:1 is apparently pretty common, although you often have to read the fine print to glean that - something the bookies may find convenient. The bookie gets his profit from asymmetrical odds just as you describe.