In one of my recent posts, I mentioned how I had opened up an account at NoVig, a sports betting exchange. I've been betting on there just about every single day for about two months now, so I thought I would talk about how I use it, some small tips and tricks, and also what I think about exchanges in general.
First off, let me remind everyone that I am in no way affiliated with NoVig or any other sports book or any other THING. You'll see no referral links from me, ever, and everything and anything I say on here is 100% because I think it's true and I feel like telling people. That is it.
(Also, one more thing before I dive in, my next post will be about my big boy BTC purchase(s)/strategy that I talked about last post).
So like I said, I opened an account at NoVig and have been using it quite a lot. First off, a quick review of NoVig specifically: Overall, I really like it. It's easy to use, super quick and light feeling, user friendly. It's app only though which does suck. I've read that they're working on a regular web page but we'll see. It's commission free which is awesome and one of the best things about it. They have far and away the best odds available for nearly everything when compared to normal sports books. Even against exchanges they're usually the best number on the board, sometimes on both sides. Think about that.
The better prices alone are worth signing up for, but they offer promos too. They aren't anything compared to regular sports books but they've amounted to something like $100 a month for me with small free bets and deposit matches.
I know this probably sounds like an ad almost but honestly, I can't quite recommend them enough. Not even NoVig specifically but just an exchange in general. The differences in the prices you can get are absurd.
Negatives: the only real negative to an exchange is the liquidity. However, if you're the kind of bettor that worries at all about 'liquidity', you're almost for sure a professional. So if you are anything other than a full time professional sports bettor, you can definitely make use of an exchange.
Now, here is the way I use it. I just look at different lines and look for anything with a roughly 7 cent or better spread. So something lined at -120, +127 for example. Then I make even offers on both sides, usually at slightly better prices. As one side gets filled, I'll offer the other side plus an additional unit. So I basically have one unit at risk, flip flopping between sides as the orders get matched and my number gets better and better. I almost always end up with a bet of roughly one unit on one side at a price much better than the closing line. It's honestly pretty easy. A bit time consuming I suppose, especially with it all being on the phone, but nothing like making and using models. Not even close.
When I first signed up, you could make an offer at any price you wanted to. After being on there a couple weeks, they changed it so that you have to offer prices at better than one cent increments. For example, if someone is offering +120, I can't offer +121, it would have to be +122. The further from zero you get, the bigger the difference is. For instance, after +260 you have to offer +264.
And I swear to god, I think they made that change because of me. I was undercutting everyone and everything by one cent, lol. When I first saw the change I was pissed but I'm actually in favor of it now. I was honestly using it too much and spending way too much time building one cent arbs. Even if you get a decent amount down, it really isn't worth it. I try to get at least 3 cent arbs now.
A really good tip to using an exchange is to look at the order book. That will show you how much money is being offered at each price. Sometimes you'll see a a razor sharp line but the two best prices on the board are for less than 50 bucks. I generally treat any offer under 200 bucks as non-existent.
Another good tip is finding the right balance between patience and aggression. Sometimes you get one side filled and you want the other side to get filled as well, so you might make something of a panic offer. I have found that you usually want to err on the side of patience but not all the time. Sometimes you really do have to pounce. Finding that line is important.
Also, I almost never take. Over 90% of my action on there is through make orders. Except for live betting, I'm surprised that anyone takes anything. Why not do a make order and get yourself at least 3 cents better?
The way I use it is that I essentially become a bookie, except I don't have to interact with anyone or worry about getting paid - the two worst, by far, things about taking action. I can also limit what, when and how much I take action on.
The only real downside of this approach is when you have offers up on both sides of a line and the market moves hard one way. Then you get one side filled and are stuck with a losing bet. This does happen from time to time and is the reason I always start small and build as they get filled. Early on, I had the idea of just offering a big amount on both sides and letting them sit there and get filled throughout the day. But that's exactly how you can can get stuck holding one side of a bad bet. So now I always start small, usually 100-200 bucks on both sides, and increase as they get filled. It is more work but I think it's worth it.
An interesting thing I have discovered in the past couple months of doing this is that the path towards market efficiency isn't always a straight line. In fact, it usually isn't. For instance, say a money-line opens at -110. It might drift around all day, going to -105, then -111, then -117, then -122, then back to -117 and maybe closes at -115. It's not like it simply goes from -110 to -115. I believe that's called a 'random walk'. It's more similar to the stock market than I think I realized. Numbers get bought up and then the buyers lose steam and it starts going the other way. I've been so conditioned to 'follow steam' but sometimes that just means buying a number at the top. So if you do only get one side filled and have the market move against you, don't panic and go for a 0 arb, especially if there's plenty of time before the game starts. Of course, this isn't always the case but being this on top of so many market moves this season, I must admit I have learned more about markets in general and chasing steam is not the end all be all.
Another tip is to consider how far out the game is. I used to make offers on next day games but those got crushed. I never do that now. I generally wait for a few hours before game time before offering anything.
Also good to know is that liquidity comes in exponentially. In other words, way more money gets bet on a game the closer it gets. You'll be shocked at first at the flurry of orders that can get matched in the last 5 minutes before a game starts.
Overall, my ROI on there after about two months is just under 2% with a lot of volume. And that's with a good chunk of run bad in there, too. After my first weeks and nearly 400 bets, I was actually down a small amount. I honestly couldn't believe it considering how much I was beating the close, or at least how much it felt like I was. So I spent some time and looked back on a bunch of my bets and looked up the Pinnacle closing line. Sure enough, I was beating it on nearly all of my bets. It was just running bad and ever since then it's been a steady climb up. It goes to show the variance that can happen. If I didn't know better, I could have easily gotten discouraged and given up right before it turned around. So you do need to have a little bit of balls to grind away at it, day after day. Especially with baseball. What a grind baseball is, huh?
Since starting with NoVig, I have had one overall losing week out of 8, and that losing week was less than one unit. The wins aren't massive by any means, but with so many bets every day, the variance does tend to smooth itself out a bit. It's way less lumpy than NFL betting. Between the promo's I still get and NoVig, I'm honestly surprised when I have a losing week at all.
As for exchanges in general, I am starting to come around to the idea that they are the future. It would certainly be on brand as the world gets more and more decentralized. If we can decentralize taxi cabs and hotels, we certainly can with sports books. The only action that I now give DraftKings or FanDuel or BetMGM are on their promos/odds boost and off market numbers. (Speaking of which, I could not believe how many arbs I was able to hit during the World Cup. Big, juicy 10+ cent arbs on stuff I was able to get over $2k down on the soft side of.)
To be honest, I'm actually a little bit worried about my DK stock now. I'm just about break even with it now sitting at 25ish a share. Next time it pumps I think I will trim some. I know sports books offer something slightly different than exchanges and exchanges can be a bit intimidating to a n00b, I suppose. But that's the case with anything new. I think that long-term, like 50 years, sports books will mostly be a thing of the past. I think they'll always exist in the same way that taxi's still exist, but the writing is on the wall. The future is decentralization.
That's about it for me today. I had an amazing World Cup, I must say. The amount of arbs and half-scalps I was able to get were incredible. (Here's an example off the top of my head: BetMGM had 'both teams to score' on the final game at -105. At the same time, I was able to get 'both teams not to score' matched at NoVig at +120. And I was able to get a little over $2k down at BetMGM. That's just one example of many). I couldn't believe how many live arbs there were, too. Live arbing is nerve wracking but I love it. I gotta admit, I was into soccer this year. The tourney was great entertainment. The diving and acting are so hard to watch and it is such a non-American sport, but it was fun to follow along and again like I said, the betting opportunities were excellent.
Up next I will dive into Bitcoin and my big boy plan/purchase. Until then, thanks for reading and bye for now!
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