• About
  • Mortgage Basics
  • $40K Challenge
  • Aunt Doris
  • Grandfather Says
  • Privacy
  • Archives
  • 100 Words

Len Penzo dot Com

The offbeat personal finance blog for responsible people.

How to Use Line Shopping as a Financial Tool When Betting on Sports

By Tex Freitag

Line shopping is quite possibly a bettor’s greatest tool to mitigate their risks and increase their bankroll. It is something you should know before you join one of the best sportsbooks available online and start wagering on sports.

To help you grasp the concept of line shopping, we are going to explain what it is and the two scenarios where successful bettors use it to either guarantee returns on either or increase the chance of winning when betting on both sides.

Line Shopping is a Strategy Every Bettor Should Use

If you do not know the term line shopping, a simple definition is this: Line shopping is when a sports bettor uses two or more sportsbooks to track the movement of odds and point spreads. Doing this makes it possible to find scenarios where a bettor can a) bet against their original position and eliminate any chance at losing any of their bankroll or b) find a scenario where betting against their original position can potentially win the punter double.

Example for Scenario A

A huge heavyweight fight is announced. The odds open, and Fighter A (1.53) is the favorite over Fighter B (2.50). Your opening bet on the fight is on one unit (for the sake of simplicity, let’s say one unit equals $100) on Fighter A to win the fight. As the fight approaches, both public and sharp bettors are hammering the favorite, causing sportsbooks to move the line.

As betting with the public has no proven track record for guaranteed success, you opt to shop for odds on the underdog. You find on one sportsbook you use, the odds on Fighter B have moved from 2.53 to 3.25. On odds of 3.25, you can bet between $45 and $52 on Fighter B to guarantee yourself a 1% to 5% return — no matter the outcome of the fight.

Why Follow Scenario A

The reason you may follow scenario a is because you are more risk-averse on your original position than at the time you were when you placed the bet. As this approach to line shopping is most common on events with weeks or months of buildup, new information may arise that changes how you feel about one side or the other. You may also want to slowly build your bankroll and view a guaranteed return of 1% to 5% as the best option.

We should note that there is no guarantee the line will move enough to take a position on both sides and return a profit.

Example for Scenario B

No example in the sporting world better describes scenario B better than Super Bowl XIII — also dubbed Black Sunday by the sportsbooks in Las Vegas. The game opened with the Pittsburgh Steelers as a 3.5 point favorite over the Dallas Cowboy. As the bets poured in on Pittsburgh, the sportsbooks adjusted the line from 3.5 to 4.5 points. After moving the spread, many bettors switched their position from Pittsburgh to Dallas. The line eventually settled at Pittsburgh -4.

Pittsburgh won the game 35-31 — meaning bettors who took Pittsburgh early and bet on Dallas later won both of their bets.

Why Follow Scenario B

While scenario A is about eradicating the risk of loss with a guaranteed small return, scenario B is about the chance to win twice with the risk of a slight loss. Assuming that odds on the point spreads are a standard 1.91 and you are wagering $20 on each bet, you stand to make $36.40 if both wagers hit or lose $1.80 if only one wager wins.

Since the loss is less than 5% of the amount you stand to win if both wagers hit, you only need a success rate of 5% (that is: 1 out of every 20 bets) to net a profit and increase your bankroll. Of course, the higher your success, the faster your bankroll will increase.

This betting strategy is becoming increasingly popular when betting on NFL over/unders — as lines are typically driven up by the public and may settle two to three points higher than they opened on Sunday.

Photo Credits: stock photos

April 15, 2021

The Question of the Week:

Do you think credit unions are safer than traditional banks?

View Results

Loading ... Loading ...

Recent Posts

  • The Big Advantages of Natural Gas Appliances
  • Is a Master’s Degree in Education Worth It? 7 Key Questions to Ask
  • Comparing the Flat Tax, Fair Tax, and Progressive Tax Systems
  • Are Energy Efficient CFL Bulbs Worth Paying More For?
  • Black Coffee: Pushing the Panic Button
  • The Continuing Chronicles of Elaine, Part 10
  • 3 Ways That Make Credit Cards Vulnerable to Fraud
  • Common Financial Mistakes in Manufacturing (and How to Avoid Them)
  • Blind Taste Test: Does Bottled Water Really Taste Better Than Filtered Tap?
  • Black Coffee: Banking on the Future

Disclaimer

This site is for informational and entertainment purposes only, and the content herein should not be mistaken for professional financial advice. In fact, making investment decisions based on information published here, or any other website for that matter, is more than unwise; it is folly. This website accepts advertising in the form of monetary and other compensation; as such, topics of discussion are occasionally influenced by these advertisers. Sometimes, an article may also include affiliate links, meaning, at no additional cost to you, this blog earns a commission if you click through and make a purchase (for example, as an Amazon Associate I earn from qualifying purchases). Remember, you and you alone are responsible for the decisions you make in life, so please contact an independent financial professional for advice regarding your unique personal situation.

Sign up for the weekly Len Penzo dot Com newsletter
Len Penzo dot Com Delivered Weekly
Join more than 40,000 readers and fans who enjoy personal finance and macroeconomics with an offbeat twist!
Invalid email address
Thanks for subscribing!

Popular Now:

  1. 1. 18 Personal Finance Facts About US Presidents
  2. 2. Credit or Debit: Which One Is Actually Better?
  3. 3. Why Buying Gasoline in the Morning Can Save You Money
  4. 4. Why Paying Off the Mortgage Early May Be a Big Mistake
  5. 5. What Defines True Financial Success?
  6. 6. A Georgia Teacher Shows Why It Always Pays to Read the Fine Print
  7. 7. Debt Elimination: The Pros and Cons of Dave Ramsey’s Baby Steps
  8. 8. Home Repair Scams: Here Are the 9 Biggest
  9. 9. Historical Gold & Silver Benchmarks for Wages and Commodities
  10. 10. 4 Good Reasons Why Some Quarters Are Painted Red

All-Time Most Popular:

  1. 1. 19 Things Your Millionaire Neighbor Won’t Tell You
  2. 2. Dear Friend: Here Are 41 Reasons Why I’m NOT Lending the Money
  3. 3. Why Your Expensive Luxury Car Doesn’t Impress Smart People
  4. 4. If You Can’t Live on $40,000 Annually It’s Your Own Fault
  5. 5. 21 Reasons Why Corner Lots Are for Suckers
  6. 6. 4 Smart Reasons Why College Isn’t for Everyone
  7. 7. 18 Fast Facts About Social Security Numbers
  8. 8. My Ketchup Taste Test: Upset! Guess Which Brand Topped Heinz
  9. 9. Why I Prefer a Spreadsheet to Track Expenses and Manage My Finances
  10. 10. Here’s a Simple Trick for Getting Credit Card Interest Charges Waived

Copyright © 2023 Len Penzo dot Com · All Rights Reserved · Designed by Nuts and Bolts Media

© Len Penzo dot Com 2008–2023