What Are Sports Betting Markets?
UNIT 3.1 – SPORTS BETTING MARKETS EXPLAINED
Introduction: Betting Markets Explained
Have you heard the term “market” used to refer to sports betting odds? Betting markets define what you can bet on within a sporting event, and offer a large range of possibilities beyond simply predicting a winner. Within a sportsbook, betting markets revolve around specific events or situations which will have odds attached to them. For example, the final score of a soccer match, the winner of a fight, or the NFL most valuable player of the year are all things, or “events”, you can bet on – ie. betting markets. In all, this article covers the following:
What Are Sports Betting Markets?
A betting market is simply an event that you can bet on offered by a sportsbook. While odds describe the cost of betting, a betting market describes what you are betting on. Betting markets usually refer to the type, or category, of a bet available for a given sport. For example, some common betting markets for the NFL include:
- Who will win outright?
- Who will make the playoffs?
- Who will be named rookie of the year?
The three most common categories of betting markets deal with the overall outcome of a game: the moneyline, spread betting, and totals. These three betting categories can be thought of as the overarching markets; they’re the three types of outcomes that are most common and simple to bet on. Additional markets you will often see include futures, props, and parlays – though in some ways, these are just modified versions of the three categories already mentioned.
To help you better understand what we mean by the “types of outcomes”, here is a quick overview:
- Moneyline: Betting on which team will win a game or match. Usually there are only two outcomes here, but in some sports, such as mixed martial arts, there can also be a draw.
- Spread (also sometimes called a handicap): Betting on how many points the winner will win by. The sportsbook will list a number of points, and bettors can wager on whether the result will be more or less than that amount.
- Totals: Betting on what the total combined score will be at the end of a game. Totals are usually broken down by scores over or under the amount listed.
Aside from each of these three betting markets, or categories of outcomes, there will be hundreds of bets (i.e. markets) you can wager on. For example, you can also bet on whether a player will score or not, when in the game they’ll score, whether a team will advance to the next round of a tournament, and so many more options. As we said at the beginning of this article, a betting market is simply what you are betting on.
About The Sports Betting Market
So why do we call them betting markets? Odds exist within betting markets to set the price of betting. When odds are set, they are not set in stone, but will fluctuate up or down as bettors lay down money. In this way, sports betting markets can be thought of as the marketplace for odds. Similar to the stock market, the betting market is simply a “gathering of people for the purchase and sale of goods”. In this case, the gathering of people tends to be online, for the purchase and sale of odds to win.
Within each betting market, there are thousands of bettors putting down wagers. When oddsmakers create odds, they do so in a way that hopefully feels fair to bettors, and encourages players to wager on both sides of the potential outcome. This careful selection of odds allows the sportsbook to make money on both sides of the action, while keeping customers coming back. Like any market, if the odds or “goods” being sold are too good of a deal, the price will go up to slow down people making purchases.
For the sportsbook, this is necessary as they ideally want an even amount of bettors on each side of the possible outcomes. So, like any market, the cost (or odds) are largely driven by supply and demand. In this case, the sportsbook changes the odds to help mitigate their risk and encourage even amounts of bets on either side of the possible outcomes. This change of the odds, also called line movement, is a strategy the sportsbook employs to ensure they always make a profit. The term for this is called the vigorish.