Bookmakers, or bookies, are figureheads in the gambling world. They are the people who take bets on sports events like football and horse racing, as well as other high-profile event with undermined outcomes like the Oscars and other awards ceremonies, and political elections.
Much like brokers in the stock market realm, bookmakers try to predict the outcome of a particular event, take bettors’ “investments,” and then pay out the profits based on the results. Of course, they are also in the business to make a profit for themselves, so they receive a portion of the winnings, known as the margin.
In order to ensure their profit, bookies consider all the possible outcomes of a particular event. Online booking companies typically employ a team to set the odds. This team of individuals look at all of the statistical probabilities, public opinion, recent matches, player stats and more, all with the goal of making a profit and increasing their margin.
Bookmakers also make a profit by setting the odds so that they do not equal 100%. The simplest analogy is a coin toss.
If you were betting with a friend, you might wager $10 on the outcome. Heads you win the $10, tails you give them $10. If this is the case, there’s no advantage to either of your so the decimal odds are 2.0. This in turn means a 100% market with zero margin – as in zero profit for the bookie. As bookies have to make a profit, they set margins to give them the edge, ensuring the market comes in above 100%. They add on usually between 2% and 10% and reflect this in the odds offered. The lower the edge, the better for the punter.
Betting companies hope to get bets on all conceivable outcomes, which means they “win,” no matter who the winners of a particular match are. If all bettors placed stakes on the same team or horse, for example, and another team or horse won, that wouldn’t be a desired outcome for anyone involved.
If particular odds receive so many bets that a profit becomes a loss, the odds will be adjusted so that the bookmakers always make a profit. Roughly translated, if the odds of a Manchester United win of 10/1 (11.00) attract a massive flurry of bets while the 3/2 (2.5) odds behind Chelsea attract nothing, there’s a strong chance the bookie will reduce the 10/1 (11.00) and increase the 3/2 (2.5). When this kind of movement happens, punters get a good idea where the smart money is being wagered and can do likewise – aka arbitrage/sure betting.
It’s not only companies that can act as a bookie, however. Individuals can participate in a betting exchange, and use the odds to their advantage to make their own profits, which can be substantial. For example, in exchange betting, if one person chooses to back a team with 9/1 (10.00) odds, they can place a “back bet” and wait for someone else to take the bet. A “layer,” the person who takes that bet, works similarly to a bookmaker in this situation. In this instance, the layer is in fact acting as a bookmaker, and both the layer and bettor will make a profit if the outcome is in their favor.
Choosing a bookmaker might be crucial to your betting success and there are quite a few factors. To help you make that decision, Blogabet has created a bookmaker review section with detailed reviews and rankings, but also free bets and other promos. Many bookmaking companies offer special bonuses and promotions and working with those will be discussed in detail in a later article.