One of the most popular terms in professional sports betting markets is ROI, which stands for Return On Investment. This term represents the amount of money you could potentially gain from any investment and it applies to all types of different areas of finance in addition to betting on sports. Here is a look at ROI and the importance of sports betting money management.
Handicapping sports betting markets can be similar to investing in the stock market in that you are looking for the best value available and then investing in the bet that you think will provide the greatest return on your investment. The first step is picking a winner but after that you have to make sure that you are getting a good return based on the amount of money that you are investing. For example, if you are risking $400 on a -200 favorite then you can only win $200 if the bet is successful. If you lose the bet, then you are down $400. That simply isn’t a good return on investment number since the amount you are risking is so much more than your potential winnings. The key to ROI is finding the best value on your wagers and it’s important to take the time to break down the numbers and determine where the best numbers are.
How To Calculate ROI
If you have ever sat through a college finance or university math class you have probably heard about ROI and calculating it when it comes to stock markets or any other types of financial investments. It isn’t difficult to calculate ROI as you are simply looking at the amount of money you are risking in comparison to the amount of money you can possibly win. For example, if you place $100 on 100 different bets at a normal 10/11 rate of juice then you will already be down $500 in juice based on a 50/50 split of your bets. That is simply not a good ROI. However, if you are betting that same $100 on 100 different underdogs at 11/10 odds then a 50/50 split will result in a positive difference of $500 in ROI, which is obviously a much better number. By doing the necessary research and calculating the ROI ahead of time you can increase your chances of making a profit and build up your bottom line.
One of the most important elements of successful sports betting is money management and yet far too often the casual fans don’t realize how much of a difference it can make. The smart handicappers will do their due diligence and put the necessary time in to figure out where their best ROI lies and how to turn it in to profits while the casual handicapper might bet without consideration to ROI and hope that they can pick enough winners to outweigh the potential risk involved. Take the time to understand the impact of ROI and try to work them in to your projections in order to gain a greater edge. It will help you in both the short term and in the long term while helping your build your bankroll.