Introduction to Sports Betting
by Mike Carey, @MCintheDMV32
On Monday, May 14, 2018, the Supreme Court, in a majority 6-3 decision, overturned the 1992 law known as PASPA, or the Professional and Amateur Sports Protection Act. PASPA prevented states other than Nevada, Oregon, Delaware, and Montana from legalizing sports betting and collecting taxes from it. With this decision, the United States has now become the Wild West again as domestic and foreign sports books have descended upon the new market, trying to occupy both territory and bet share. Now that PASPA has been dissolved, let’s answer a few questions about what that means for you, the bettor.
First of all, let’s ask the question: Is sports betting legal? The answer is: kind of. PASPA was a federal law which prevented states not grandfathered in from taking bets. Now that it's gone, each individual state is left to enact their own legislation to allow licensed books to accept wagers. So, if you currently live in or are visiting New Jersey, West Virginia, Delaware, Mississippi, and Nevada, you can bet at sportsbooks run by casinos or race tracks, and likely through online apps supplied by Caesars, FanDuel, Draft Kings, and William Hill among others. For residents and visitors to Pennsylvania, New York, and Rhode Island, your time is coming soon.
In theory, we should have a lot more people placing wagers in the future. According to a LendEDU survey, 60% of residents in states with now-legal sports wagering had never placed a wager with an offshore sportsbook or local bookie.
For everyone else, we are still only left with offshore books like BetOnline and 5dimes (occupying a legal gray area) or your local bookie (definitely illegal as they are unsanctioned by their respective state). However, you should feel comfortable betting with your offshore book or with someone that you’ve met and trust. It doesn’t appear that anything is going to be done to shut down, for example, the 5.3 billion dollars wagered illegally on the Super Bowl last year – the goal appears to be to turn that money legitimate. Whatever your weapon of choice may be for sports betting, let’s discuss a few underlying principles and some do’s and don’ts.
If you’re brand new to sports betting, as in you’ve never been in a book before and never read any lines, I would highly recommend you checking out this link: https://www.vegas.com/gaming/gaming-tips/sports-betting/. This provides a pretty decent overview of the types of bets, how much you can expect to win based on how much money you put up, and the small differences in terminology between sports. Our weekly content will use many of the terms from that article as if you already know them.
One thing that Occupy Fantasy stresses is bankroll management – the idea that if you risk your money wisely, you’ll never have to deposit into your account again. This is especially important for sports betting as well, since over exposure can lead to zeroing out in your account. In comparison to DFS, sports betting requires a much more significant bank roll. With $100 in DFS, you could play a high number of $1 contests using Occupy’s guidance and very easily never be in danger of hitting rock bottom. However, with sports betting, a bank roll of about $1,000 is a good entry level position. Why so much more? Often times your offshore book or local bookie will place a minimum win/risk threshold meaning that either you have to put up $25 on an underdog (+125 for example) or put up enough money to win $25 on a favorite ($100 on a -400 favorite).
Next, with your $1,000 bank roll squared away, let’s talk about how much you should be wagering on each bet. Bettors often refer to this amount of money as a “unit”. Your unit size should be between 1 - 2.5% of your initial bank roll, depending on the level of risk with which you are comfortable. This cap on the amount you’ll be betting will prevent you from being as vulnerable to a cold streak given the natural ebb and flow of wins and losses. With this in mind, you shouldn’t ever change your unit size based on a period of wins, or even worse, a period of losses. Once your bankroll has grown significantly to a position where you can remain comfortable with losing, you might consider raising your unit size, but for now, let’s not worry about that. As a preference, you can choose to either risk 1 unit (1u) on each wager or bet to win 1u. For the purposes of this introduction and our future NFL Betting Plugs, we will recommend betting to win 1u.