Is Betting On Sports Considered Gambling?
You might have heard the myth that it’s possible to make money betting on sports. The illusion that sports betting is a skill-based activity has duped millions of people over recent years, with 76% of sports bettors aged 21-34 believing gambling to be a form of entrepreneurship.
In reality, sports betting has much in common with other casino games like blackjack and roulette. While it may be true that you will lose your money slower betting on sports than playing casino table games, betting is still fundamentally gambling.
This page will help you understand why using a sportsbook is gambling.
Definition of Gambling
Gambling is the act of risking money or something of value on an event with an uncertain outcome in the hopes of winning additional money or material goods.
Gambling typically involves three key elements:
Consideration: The amount wagered or risked.
Chance: The random factor determining the outcome.
Prize: The potential reward for winning.
Gambling can take many forms, including casino games, sports betting, lotteries, poker and online gaming. However, almost any activity that involves chance can be used for gambling.
Why Using a Sportsbook is Gambling
Sports betting is considered a form of gambling. It involves placing a wager on the outcome of a sporting event, with the intention of winning additional money or other prizes based on the outcome of the bet.
Nearly every sport with a regulatory or governing body has been approved for gambling.
Like other forms of gambling, sports betting carries risks and can lead to financial loss, as well as addiction. Around 30-40% of sports bettors experience problems.
Is Sports Betting Skill-Based?
No, sports betting doesn’t involve skill. You have no control over the outcome of your wagers or the events you bet on. Many people suffer from betting problems because of this skill illusion.
Nearly all gamblers lose money in the long run. The only way to be profitable long term with sports betting is by finding very small edges known as “value bets” and placing a large number of them over an extended period of time. Over time, you could win slightly more than you lose and turn a profit. However, sportsbooks usually ban winners, and it’s legal for them to do so.
Creating a model to help you locate these so-called value bets is also nearly impossible and not worth pursuing. Furthermore, do not make wagers based on the advice of people who give out picks and so-called “best bets.” These betting industry influencers are losing bettors.
Any person who develops a system to start winning their bets slightly more than they lose them almost always tries to fly under the radar because sportsbooks are quick to ban savvier customers. Nearly all of the sports betting industry revenue is generated by problem gamblers.
Is Sports Betting Like the Stock Market?
Sports betting and stock market trading share some similarities and can cause immense harm to individuals, but they also have significant differences. Below is a brief comparison.
Similarities
Risk: Both involve risking money with the potential for financial gain or loss.
Research & Analysis: Performance in both can be influenced by the amount of research and analysis an individual conducts. However, research quality can be poor.
Market Influences: Both are influenced by external and unpredictable factors (e.g., injuries in sports, interest rates, macroeconomic conditions, and so on.).
Speculation: Both activities involve speculation about future outcomes based on available or public information, often leading to the illusion of skill or expertise.
Differences
Long-term vs. Short-term: Sports betting typically involves short-term events and immediate outcomes, leading many people to addiction. Meanwhile, the stock market can involve both short-term trading and long-term investments. Stock trading on platforms such as Robinhood can be highly addictive for many people.
Expected Value: Sports betting has a negative expected value for the bettor due to the "house edge" or bookmaker's margin. Historically, stocks have provided positive returns over the long term, though they carry enormous potential for loss, especially for traders.
Parlays Are The Riskiest Form of Sports Betting
A parlay bet combines multiple individual bets into a single wager. It’s essentially a lottery-style form of sports betting and one of the worst bets for players.
To win a parlay, all the individual bets (legs) must be successful. If even one bet fails, the entire parlay is lost. That said, some sportsbooks have started to offer parlays where some legs can lose and the potential payout is significantly reduced. These are also bad wagers.
Why Parlays are Risky
Increased Complexity: Each additional leg in a parlay increases the complexity and decreases the probability of winning. The more bets you include, the more outcomes must go your way. The potential payout doesn’t increase in proportion to the risk.
Exponential Risk: The risk multiplies with each additional leg because the bettor is reliant on all selected outcomes occurring as predicted.
Payout Temptation: While parlays offer higher payouts compared to individual bets, this is because the likelihood of winning is significantly lower. The high potential reward can tempt bettors to make riskier bets and lead to chasing losses.
Sportsbook Edge: Sportsbooks have a higher margin on parlays. The compounded probability of multiple outcomes makes it even less likely for bettors to win.
Bottom Line: Betting Counts as Gambling
Regardless of how you bet, sports betting is gambling because you risk money on uncertain outcomes and lose money in the long run.
In the current era of sports betting, it’s impossible to win in the long run. Even if you developed a system with a very small but significant edge to exploit betting on a sport, online betting sites will ban or restrict your account. Sportsbooks only accept customers who lose in the long run.
Because you can’t make money on sports in the long run, we recommend caution when using a betting app.
Image by Manuel Schmitt from Pixabay.