Question of the Day - 09 February 2020

[Editor's Note: This question is answered by Blair Rodman, co-author of Kill Phil, whose new book Bet Sports is due out some time this year.]

While many people think that sports books simply make profits from their built-in vigorish (and owners of books wish it were that way), the reality is that books are often heavy on one side of a bet and can be forced to accept some risk, although they do what they can to balance the action.

One way they do this is by moving their line on a game getting heavily bet on one side, to attract bets on the other side to help balance the action, although moving a pointspread line opens up the risk of getting middled. For example, if a book moves a line from -3 1/2 to -4 1/2 and the game lands in the middle on -4, the book must pay betters who laid -3 1/2 and those who took +4 1/2, a disaster for the house.  

Another way some books address the issue is to shade their initial lines to anticipate heavy action on one side by local bettors who are fans of and loyally bet on the local team. I addressed this in a previous QoD. 

Unregulated bookies have a lot of advantages over legal books. One is that they aren't prevented from laying off bets, as legal books are. I have a friend who was a bookie back east and regularly laid off bets to a mob lay-off bookie. It was a good business decision for him, both to keep his business balanced and to get the mob's blessing to do business.

Current laws prevent regulated books from having the option to lay off bets. According to long-time sports book manager Robert Walker of USBookmaking, "... partly due to the Wire Act, bookmakers have woefully [few] options to lay off wagers or hedge risk. It is something we are working hard on at USBookmaking."

As Robert says, legal books are striving to level the playing field with non-regulated sports books, and this is one area that would greatly benefit them. However, legalized sports betting in the U.S. is a young industry suffering a lot of growing pains and how quickly these kinds of issues will be addressed and/or resolved is unknown.