How to Beat Vig, Variance and Volatility

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Baseball fans will surely remember Killer B. The Astros had Biggio, Bagwell, and a rotating cast of other guys like Derek Bell, Sean Berry, and even Lance Berkman. Older football fans will remember the Miami Dolphins’ Killer Bs in 1982 with six starters on the defense whose last names began with B.

Well, sports betting has what I would call the Killer V – Vig, Variance, and Volatility. To be a successful bettor, you need to overcome all three of these things at a fairly high rate.

Vig

Let’s start with vig, which effectively means “house edge”. The industry standard is -110, which results in a break-even percentage of 52.38 percent. This means that you have to win 52.38 percent of your bets on -110 just to avoid losing any money. The higher the Vig, the higher the break-even rate. The lower the Vig, the lower the break-even rate.

Betting kiosks at the new sports betting company MGM National Harbor, Thursday, December 9, 2021, in Oxon Hill, Maryland.
AP

At the very top you basically have to win three more bets than you lose out of 100 to make a profit. Doesn’t sound like a lot, but it can be.

deviation

For me that’s the biggest killer V. You can have the most perfect handicap in the world and still lose a game because something doesn’t work. A team can reduce a lead of 20 points in 16 minutes. A team can go 3:23 of the last 3:24 without goals. A team wins in yards per game but ends up with -3 or -4 in sales margin. A bad weather game has special team turnovers or touchdowns. A guy you pick in a player prop is injured.

Sports betting has an inherent element of luck. Sometimes it gets in your way and sometimes it doesn’t. In some cases one might have been disabled differently, but in other cases there was simply nothing that could be done about it.

volatility

The sports betting markets are living organisms. Things happen and things change. You might get a good number earlier in the week and then a quarterback or star wide receiver will test positive for COVID. A trainer is fired or on leave. A player is injured in training.

Television screens at MGM National Harbor on December 9, 2021 in Oxon Hill, Maryland.
Getty Images for MGM National Ha

Or, quite simply, you didn’t read the market right and the line moved against you. You caught the worst and now you must hope that you are on the right side of the variance. Think of the sports betting market like the stock market. There are so many external factors that create a volatile atmosphere in terms of price changes and forecasts. It can turn your head.

So what are we doing to counteract these things? Without going too long, I’ll share two suggestions. The first is to accept that there are many things in this business that are beyond your control and come to terms with that fact. Poor running can be a drain on your mental and physical health. Invest as much of yourself and your money as necessary, but not so much that it negatively affects your everyday life.

The second is to do whatever you can to minimize all three things. Strike if a line is -105 instead of -110. Buy -110 instead of -115. Look for a live betting position to get out of a bad number or protect yourself in case a game fluctuates wildly. Pay close attention to the markets and try to get an idea when large syndicates and influential groups are releasing games to customers or placing their bets.

Don’t open yourself up too much. Short-term deviations are inevitable.


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