This thought may have come to your mind while growing up to an adult – what is sports betting? how is it done? How can you make money through it? and possibly the thought of how betting websites earn money through it? You may have also asked your friends about it and may have received an inappropriate answer that has not satisfied your curiosity?
Let us understand with a basic example: what is sports betting? and how it is the source of income for various online applications/websites?
It is an action of predicting the sports results and placing a bet on the outcome. It can be performed on various famous sports like –
Tennis in various local and international events.
Now the question yet to be answered is how do these websites earn money with sports betting?
Let’s understand it with an example:
If you are just starting with betting then you may have an assumption that if you will bet Rs. 100 you can win Rs. 100 on a team but this is not betting in the sports world. If the person who is betting wants to win Rs. 100, then he has to risk an amount of Rs. 110 or more.
While placing a bet online you are required to pay Rs. 110 on your selected team on a betting website. Let us suppose if your team wins, then you will get Rs. 210 cash and unfortunately if your team loses, you will have to bear the loss on your initial Rs. 110 investment.
How Sports Betting is a business for the websites:
Let us assume that 60 people bet online on a tennis game and 30 of them take the home team and the other 30 take the away team. Suppose that the average bet amount on each side is Rs. 110 which means the bookie will collect Rs. 110 x 60 (people) = Rs. 6600.
If the home team wins, the winners will get their invested amount i.e. Rs. 110 back + Rs. 100 which is equal to Rs. 210
But wait a second, the payouts by bookies are just Rs. 210 x 30 = Rs. 6300 and they collected an amount of Rs. 6600 which means they are making a good profit of Rs. 300 from a single tennis game no matter which team wins or loses.
Also the extra Rs. 10 that the bettor is risking on his bet is what the bookies earns in addition to Rs. 300. This small amount of Rs. 10 is called “the vig” in betting which is to be taken from each bettor.
I have read and find out from my analysis that 99% of the people lose their money in bets and those 1% who actually make money are the sports geniuses who invest their mind and time in understanding the various aspects of betting. I personally do not support betting in any form.
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