Why Betting Systems Work

Anyone who has ever spent more than a few minutes on a betting forum will no doubt have seen threads with titles along the lines of "Does a football betting system that works exist?".

Remove 'football' or substitute any other sport for 'football' and the question still holds good. 

While the question is somewhat naive the answer, technically at least, is obviously yes - betting systems do work, but the caveat is that they shouldn't work in perpetuity. 

In an efficient market with rational participants, systems will have a limited shelf-life, although as in the case of College Football's Road 'Dogs, this 'limited' shelf-life is 19 years and counting. As I've mentioned before, the good news is that market participants are not rational, but are influenced by biases, often long-held.

SmarterSig had an interesting perspective on the subject of "do betting systems work" concluding a very readable article with:

Systems do work, they work in the sense that there are rule based methodical betting methods that produce consistent profits and they work because they give people a valuable apprenticeship in understanding data.

Probably not the answer most readers looking for easy money want to read, but the writer makes a good point.

The same point applies to making a budget of any kind of plan. However well you try to accurately predict the future, invariably you're wrong, but:

A plan is important because it's the foundation to help you helping you project objectives and achieve your ultimate goals. Having a plan helps you define the full scope of a project but it also helps you stay focused, set goals and objectives, meet deadlines, measure success and debrief the entire project.

Or as Dwight D Eisenhower put it:

"I have always found that plans are useless, but planning is indispensable"

 SmarterSig's article also makes the point that:

There are benefits to system development beyond the uncovering of a successful system, one of which is the journey itself. Analysing data from a system perspective is a great introductory way to get a feel for the terrain you face as a punter. The amount of loss you need to overcome in order to become profitable and more importantly what factors move you closer even if in isolation or combination they do not quite achieve long term profit. The study will give you a greater feel for the biggest hurdle all punters have to overcome, namely variance. In other words the kind of winning and losing periods once can expect to experience even with a decent looking system.

What makes a 'decent looking system' is subjective, but because sports markets have inefficiencies, opportunities are out there for those willing to do the work. Just don't expect them to last for ever, which is why, if you should uncover an edge, you need to act on it. By the time you have statistical proof that a 'system' works, it will likely have stopped working - if you see what I mean.

In a liquid market, as I've written before, simply "picking your selections at random means you should break even over the long term, excluding commission of course", so even if your edge turns out to be an illusion, you shouldn't lose your shirt. Keep an eye on the sleeves though. If they are gone, it might be time to cut your losses.

This "@SmarterSig" chap (aka Mark Littlewood) might be worth following if you are into horse racing.

A quick look at some of his other posts show some quality content, something that is something of a rarity these days. He appears to be of a similar vintage to myself, although we differ in our opinions of Farage. In one recent post on horse racing, he (Mark, not Nigel) writes:

I had begun my betting career with a strong bias against handicaps which I now realise was a mistake. My belief that there was no point arguing with the handicapper who’s full time job was to make all the horse’s theoretically dead heat was incorrect but it took me a few years to realise this.

I recall coming to the exact same conclusion on handicaps myself back in the 1970s, although the direction I ultimately took was away from horses altogether. Mark writes in one post:

My belief that there was no point arguing with the handicapper who’s full time job was to make all the horse’s theoretically dead heat was incorrect but it took me a few years to realise this.

Ignoring the incorrect apostrophes, I remember avoiding handicaps for this exact reason. Larger fields were another reason, and for a few years in the late seventies, backing the favourite in non-handicap Novice Hurdles and Novice Chases with 6 to 10 runners was a system I followed, and I see variations are still in vogue 40 years later! Somewhere, quite possibly in the attic at my childhood home, are some notebooks with the results neatly documented in my 'just left school' handwriting. If my parents ever move, and 64 years after moving in they are still there so don't hold your collective breath, I shall put on my hazmat suit and attempt an extraction.