The Reason Why I Choose Sports Betting Over Traditional Investing

Quite a few people ask why I choose to use sports betting as the active investment vehicle rather than looking into day trading, swing trading or more longer-term focused investing.

The answers are below.

1.) Speed of Feedback

The first reason is how quick you get feedback from your bets/trades.

They either win or lose.

Black and white.

Obviously there’s good luck, bad luck, lucky wins and unlucky losses.

But, in short, you either won a bet or lost it, there’s no perception or opinions or biases.

Vs the market, where the mantra of longer term investing is; “time in the market” vs “timing the market”.

Here, you don’t get feedback for literal years, longer if black swan type events happen early on.

Even in day trading, where you might reach a statistically valid sample size very quickly.

You may have a lot of volume but usually a lower edge %, a lower ROI per trade on AVG.

So here it’s more about how you fair over the course of 6-12 months as you cannot know WHY the market did a specific thing, whereas in sports, well it’s obvious.

Sports betting can have thousands of games a month across different sports.

As a result you can get a lot quicker feedback on what is working or not, what’s winning (and importantly why) vs what may be working in other financial or traditional markets.

Even if you are focusing on just one sport, which I recommend, this can still give you 1,000+ games over the course of a season, and sometimes 100’s+ every month, depending on the sport you are targeting.

This is enough data for you to see if you realistically have an edge or not.

The key is you will start to get an idea very quickly about whether you have something profitable and real or whether it’s just randomness.

How you lose games is important as well.

If the bets you win are by small margins and the ones you lose by large ones, even on a smaller sample size, you can get the idea that you might not be approaching this in the right way. Similar to the concepts I talked about in the matrix on;

But in short, you get your feedback really quickly vs waiting for the market.

There’s also no biases that impact results.

You can still get lucky or unlucky but the luck or variance is “pure variance” not impacted by what other people do. Where the market participants actually impact the output of the market result.

Reflectivity essentially.

2.) Early(ish) Up-Side

Another reason was simply down to the amount of time I thought it would take to get to a “smaller” return.

By smaller returns, I simply mean how long it would take to get to £1/2/3k/month in each avenue.

Based on the soft-ness of the market of smaller sports, it’s very easy for someone who has a lot of knowledge of 1-2 sports that have a niche following, to earn from.

This was evident massively in 2020 when covid killed sports and there was only E sports and a couple of other very random ones to bet.

The individuals who were making 2-3-4k/month from e sports (due to the liquidity issues), suddenly were making £30-50k/month just because the liquidity increased massively to match the market.

If the goal from the start was to reach £50k/month, then this might change the overall approach and goal.

As due to the liquidity issues, it’s tough to get large amounts down on bets in smaller markets that I would be starting on, so instead looking at this as a side hustle initially (about 5 years ago). Made it easier to think about how to get to a smaller monthly profit quicker.

It still took years to do, so whether that was the right decision or not, who knows, but that was my thought process at least.

3.) Ease of Earnings in mid-range

Similar to the above, another reason was the mid-range earnings of £3-10k/month.

You see a lot of BS courses that never pass the common sense test, about how “this forex course makes you £10k/month” or this “system gets 100% a month”.

The issue is always the same.

If this were true, why not scale this anyway and earn crazy returns…

Financial markets don’t have liquidity issues for anyone risking less than a few hundred thousand per trade.

So selling a course for $997 is just nonsense.

There are exceptions to this rule, some courses are just good educational content and don’t market themselves as this “earn XYZ” and don’t make guarantees, but generally these are the exception not the rule.

But I digress.

In this £3-10k/month range is where I think sports betting is going to grow in the next few years.

Building betting models or when smart solopreneurs come in and look to earn through sports betting.

The approach isn’t getting talked about enough in my opinion.

Anyway.

Someone who understands a sport inside out, or someone who has great coding abilities, or even just has great data analysis skills has a lot of opportunities in this niche in the future.

You’ll need to learn everything about the sports betting markets, but that’s a lot easier than learning everything about the financial markets! - And takes about 1/20th of the time as well.

Sports markets are pretty basic.

You also don’t need to have a crazy bankroll.

It’s possible to make £5k/month betting with a bankroll of about £15,000 (at least in the way we bet).

This is without taking extremely high unit % risks on account.

To do that in financial markets (even if you are using leverage) you’d need at least 5 times that bankroll, probably closer to 10X.

So the ease at which it takes to make this is far easier.

Again, if you were to add a zero to the earning goals, this does change things and structures dramatically.

It’s difficult to get £2,000 down on a cricket game, let alone £20,000.

4.) Goals & EDGE Principals

Trading, the type where you have to be at a computer for those “trading hours”, is not something that passes the edge mentality.

Building a trading system/algo does pass this, but that’s a lot harder to do when getting started, it’s also far more likely to have false positives that can f*ck you up long term.

Our betting operation, at this point, could be 100% outsourced to VA’s or team members, but as it’s still growing I like to keep the friction of it with myself a little bit (intentionally as per the below post).

This still really doesn’t take long, around 20 minutes a day in the morning, that’s about it, everything else that would take longer to do, such as daily tennis numbers or cricket power ratings is done by the VAs.

5.) Personal Timeline

Finally, my personal timeline, both financially and just lifestyle wise, works better when starting with sports betting and moving into markets in the future.

It’s not that I’ll never look into financial markets properly, in 2019 I did a season on forex trading, which would have likely worked, had I continued this, the issue was the returns are very low in-comparison as a % vs sports betting.

30-50% in forex is great, especially if you are starting with millions to leverage trading. 30% of 10k or 20k, not so good. Whereas on the betting side, doing 200-300% a year is possible in the early times.

In the future, the approach is simply to invest the sports betting profits into investing, trading and the bankroll to both fund and fund the research of these things.

Doing this the opposite way around just doesn’t work.

Cheers.

Thomas.