I just finished a post in my series of “what is gambling” posts about gambling systems. The most natural follow-up in the world to a post about betting systems is a post titled “what is advantage gambling.”
Betting systems are ways of trying to win at casino games that don’t work. They involve raising and lowering the sizes of your bets based on previous results. They do nothing to change the conditions of the game or the probability behind the game.
Not every gambling activity is susceptible to advantage gambling strategies. For example, no amount of strategy will help you overcome the house edge on most slot machines.
The purpose of this post is to explain what an advantage is in a gambling activity—from a mathematical and a practical perspective. Once you understand that, you can start to explore the various techniques and methods of making the math work for you.
I should warn you ahead of time, though, that most people don’t have the temperament to be advantage gamblers. It takes a specific mindset and a lot of work.
The Concept of Expected Value
When you place a bet, you have 4 factors that affect what the bet is “worth:”
- How much money you’re risking
- How much money you stand to win
- What your probability of losing is
- What your probability of winning is
The formula for < a href="https://www.gamblingsites.net/blog/why-expected-value-is-every-gamblers-best-friend/">expected value is simple enough. You multiply the probability of winning by the amount you stand to win. You also multiply the probability of losing by the amount you stand to lose. Subtract one from the other, and you have the bet’s expected value.
Here’s an example:
You’re betting $100 on black in a roulette game. You’re risking $100 if you lose, but you win $100 if you win. (That’s called an even-money bet.)
Your probability of winning is 47.37%, and your probability of losing is 52.63%.
$100 multiplied by 47.37% is $47.37 in positive expected value. (It’s positive because it’s how much you stand to win.)
$100 multiplied by 52.63% is $52.63 in negative expected value. (It’s negative because it’s how much you stand to win.)
Add those together, and you get -$5.26.
That’s how much you stand to lose, and if you expressed it as a percentage, you’d express it as 5.26%.
That’s also what they call the house edge for that game. It’s the theoretically average amount you’ll lose every time you make that bet.
The details differ from one game to another, but the principle behind it remains the same. It’s all about how likely you are to win, how much you stand to win, how likely you are to lose, and how much you stand to lose.
How to Buck the House Edge and Get an Advantage
You obviously know that some gamblers can and do get an advantage over the casino or in other gambling activities. Professional gamblers who aren’t cheaters do this all the time. They’re called advantage gamblers.
Let’s take a look at a roulette example first, since we’ve already talked about it:
At one time, casinos used roulette wheels for a long time without replacing them. They also bought these wheels from companies which might not have had the strictest standards in place for how well they worked.
If you could identify a roulette wheel with an imperfection that caused some numbers to come up more often than they should, you could gain an advantage over the casino. To do that, you’d need to track a large number of spins on a wheel to find that discrepancy.
Here’s how the math on that might work:
On a standard roulette wheel, you might have a 1/38 probability of hitting a single number that you bet on. The payoff is 35 to 1 on that bet, so it’s obvious how the house has an edge.
But suppose you identify a set of numbers that come up more often. Let’s suppose you find a roulette wheel where a specific number comes up 1/34 of the time instead of 1/38 of the time.
What would that do to the expected value of your bet?
Let’s assume a $100 bet size again for simplicity’s sake.
You have a 1/34 probability of winning $3500, which equates to $102.94 in positive expected value.
You also have a 33/34 probability of losing $3400, which equates to $97.06 in negative expected value.
That’s $5.88 per spin on average in expected positive value, which is a huge edge to have over the casino.
Even if you clocked a wheel long enough that you were statistically confident that you had an edge, you might not be playing against the same wheel a day later.
What about Counting Cards in Blackjack?
I wrote an extensive “what is card counting” post earlier in this series, so I won’t get into too much detail about it here. I’ll just explain briefly why and how it works.
In most blackjack games, a hand with a 10 and an ace in it is a natural, or “blackjack.” It’s a 2-card hand worth 21 points. Such a hand pays off at 3 to 2 odds.
In a full, shuffled deck, this doesn’t give you an advantage over the casino. The dealer will get as many blackjacks as you do, and the game has lots of other factors that come into play.
But when a deck gets shuffled and some of the cards are removed during the course of play, the probability of getting a 21 can change. As that probability changes, so does the probability of the dealer going bust.
This happens when the deck has a higher proportion of high cards to low cards than normal. (The 10s and aces are high card;, 2s through 6s are low cards.)
Card counting is how you do that.
In the most common system for counting cards, you just subtract 1 from the count every time you see a high card dealt and add 1 to the count every time you see a low card dealt.
This is called the hi-lo system, and it works fine for all kinds of counters—recreational and professional.
How do you get your edge, though?
When you get more money into action when you have a better probability of getting a 3 to 2 payout, you tilt the odds in your favor.
You can, in fact, get an edge over the casino using this technique only—just raising the size of your bets.
But you can also make changes to how you play your hands based on the count.
This is where 20% of the edge that a card counter gets comes from—changing strategy decisions based on the composition of the deck.
Other Ways of Getting an Edge at Blackjack
That’s not the only advantage gambling technique you can use in blackjack, though. Shuffle tracking is another popular means for getting an edge. And some blackjack players use edge sorting to good effect, too.
Shuffle tracking is a way to keep up with a rough approximation of where the high cards in the deck are. When you shuffle the cards, they’re randomized, sure, but some of them tend to stay together.
A skilled shuffle tracker can get a general idea of where the 10s and aces are, so that he can raise his bets when those cards are about to be dealt.
Edge sorting is harder. The first thing you have to do is convince the dealer to change the direction the cards are facing based on whether they’re high or low.
Most edge sorters do this by convincing the dealer that they’re superstitious. Innocent dealers are happy to comply.
But the edges of the decks of cards aren’t all the same. If you can spot the differences, and if you can get all the aces and 10s facing one direction instead of another, you can easily raise the size of your bets when you’re more likely to get a blackjack.
It’s not hard to understand how you get an edge knowing exactly which both of the cards a dealer has can be.
95% of the blackjack players who think they’re advantage players probably make less than minimum wage at it, though. Part of this is because casinos actively try to thwart card counters every chance they get.
Luckily, blackjack isn’t the only gambling activity where you can get an edge.
Professional Poker Players
Poker, of course, isn’t a casino game at all. It’s a gambling game where you compete with the other gamblers at the table for the money in the pot. Most people know now that while luck is a factor, skill is the determining factor over who wins at poker in the long run.
If you’re playing poker at a table with 9 other players, and they’re all exactly as skilled as you are, over a long period of time, you’ll all get the same number of good hands and bad hands. You’ll all eventually break even.
But that’s rarely the case.
For another, most serious poker players are playing in a casino setting. At a poker table in a casino, the casino takes 5% of every pot to pay for the poker room. This 5% is called the rake.
If you and all the other players are exactly the same skill level, you’ll all eventually go broke at about the same time, because the rake will eat up all your money and theirs, too.
If you’re only slightly better than the other players, you probably won’t see a profit. You might do better than the other players, but not well enough to make up for that 5% rake. Think of it as a tax on your winnings.
You need to not only be better than the other players, but you need to be so much better that the 5% rake doesn’t destroy your bankroll.
Most poker players just don’t play well enough to be profitable in the long run. This doesn’t mean you can’t be the exception, but it does mean that it’s tough.
Becoming a Sharp Sports Bettor
I’ve talked about the house edge in casino games and the rake in poker and how they make it hard to make a profit when gambling.
Now it’s time to talk about the vigorish (or “vig”) in sports betting.
If you know nothing about betting on sports, you probably think that all you must do to make a profit at sports betting is pick winners more often than not.
If only it were that easy.
The most common kind of sports bet made in the United States is a spread bet. This is a bet on a team to cover a point spread. It prevents you from making an almost sure thing bet on the favorite in a contest.
And most people who are serious about betting on sports bet with a bookmaker—someone whose business it is to take sports bets.
If 80% of the people won their bets, the bookmaker would go out of business fast, wouldn’t he?
So what he does is set a point spread that accounts for the teams’ differing skill levels. They would normally give points to the Browns, which means the number of points they set would get added to the Browns’ score for determining who wins the bet.
If the Browns are a 14 point underdog, this means you get to add 14 to their score before determining whether you won the bet on them or not.
A bet on the Patriots would also have to take into account that point spread.
The oddsmakers at the books are good enough at setting these point spreads that you have a roughly 50% probability of winning regardless of which team you bet on.
This would mean you’d break even in the long run if it weren’t for one thing—the vigorish.
Bookmakers don’t make straight bets of $100 or $1000 with you. They require you to wager $110 or $1100 to win $100 or $1000.
To get an edge at betting on sports, you can’t just be good enough to win 51% or 52% of the time. The increased amount you lose because of the vig would eat up all your profits.
You have to win 53% of the time or more, which is harder than it sounds. To pull that off, you need to find profitable betting opportunities where the odds set by the books are a little skewed.
Recognizing those opportunities is what sharp sports betting is all about.
Even the best sports bettors in the world probably only win their bets 55% or 56% of the time.
But that’s enough.
When you account for the compounding effect that a positive ROI has when you apply it repeatedly, you can become rich faster than you ever thought possible by being a winning sports bettor.
The trick then becomes finding bookmakers who are willing to accept your action.
These are just some examples of how gamblers get advantages when betting to become advantage gamblers. Others exist, and other techniques will surely be devised.
I’m a smart guy. Heck, I qualify for Mensa. And I love poker. I even write about it for a living.
Could I become a pro poker player, though?
I probably couldn’t. I’m just not that good a player, for a variety of reasons. Mostly, I just lack the dedication to the game that’s required to win at it.
Are you or anyone you know a successful advantage gambler? If so, which advantage gambling techniques are you using, and how successful are you at it?