Comment by wavemode
20 hours ago
> I would also guess that sports betting sites like DraftKings or FanDuel would be even less efficient
Your strategy doesn't work on sportbooks to begin with, because bookmakers don't move the odds with the action.
That is, there is no such phenomenon as "the over is exciting therefore overpriced". Bookmakers price purely based on facts and statistics. Their pricing isn't affected by excitement nor by how many people are betting a certain way.
> Bookmakers price purely based on facts and statistics. Their pricing isn't affected by excitement nor by how many people are betting a certain way.
A bookmaker is a market maker, and they ideally want to end up with no net interest in a position. They then take guaranteed profit in the bid-ask spread, which in sportsbooks is the 'vig'. Bookmakers who adjust their odds in real-time don't have to be particularly clever about the fundamentals, just responsive to the competing demands on either side.
A bookmaker who intentionally takes a position on a game is the equivalent of a proprietary trader or hedge fund. It's potentially more profitable, but it's also adversarial against 'sharp' traders.
Bookmakers who set odds at the beginning and don't move with the action must set larger bid-ask spreads to compensate.
>Bookmakers price purely based on facts and statistics. Their pricing isn't affected by excitement nor by how many people are betting a certain way.
If this were true, lines would never move unless there was breaking news, but we see lines move all the time without there being any material change to those "facts and statistics".
> without there being any material change
Without there being any material change you can see. If you had access to all the tips and data and insider information that sportbooks operate with, you could be a bookmaker too.
>If you had access to all the tips and data and insider information that sportbooks operate with
Can you give an example of what you're talking about here? Because it sounds like you're accusing these large publicly trade companies of participating in organized crime. There is regulation when it comes to sports betting that doesn't exist with general prediction markets. An athlete can't just feed a sportsbook "insider information" in the way you're suggesting. The only private info that they are supposed to have is better behavior details that you claim doesn't factor into their decisions.
2 replies →
I think the distinction is that sports betting companies are basically casinos, need to guard their edge, and although they will tolerate some moving of lines, they will kick out players who consistently eat their edge, and will rig the lines at a place where they can still profit.
Different from a prediction market like Polymarket or Kalshi whose income probably comes mostly from transaction fees rather than house edge. Otherwise these platforms wouldn't welcome bots so much. Bots => efficient pricing + transaction volume => profit for them
The sustainability of prediction markets depends heavily on continuous liquidity provision - without bots and market makers, spreads would widen and user experience would degrade quickly
These are all reasons supporting my point as they would make sports betting platforms less efficient meaning it would be easier to find arbitrage in their prices (at least temporarily, until you're booted for being too successful).